Chancellor insists budget measures will be 'sensible and workmanlike' rather than pre-election giveaway

Alastair Darling will use the proceeds from the state sell-off of the Channel Tunnel rail link to pay for a £2bn green infrastructure fund, in a budget designed to help business and tackle Britain's emerging energy crisis, Treasury sources said tonight.

The chancellor, who insisted today that Wednesday's package of measures would be "sensible and workmanlike" rather than a pre-election giveaway, plans to earmark the first tranche of cash from the privatisation of High Speed 1 for seedcorn capital for low-carbon energy projects.

The projects likely to benefit from the fund will include low-carbon cars, wind energy, green waste projects and a new generation of nuclear power stations. Darling will claim that the fund will create 400,000 low-carbon jobs by 2015.

Without the investment, Britain would struggle to meet its targets for the next decade of cutting CO2 emissions by 34% and producing 15% of its energy from renewable sources.

Darling will also announce that Britain's banks will contribute £250m to a £500m growth capital fund, designed to ease the financial pressures on the small and medium-sized companies most affected by the credit crunch.

"A little bit of government help can unlock a lot of private sector investment, and that is going to be the focus this week," Darling said in a BBC interview.

He picked out the creative industries and the pharmaceutical sector as two industries warranting extra government help.

The overall aim of the budget is to set out a pathway for growth, and to give fresh details on the deficit reduction plans outlined in December.

The chancellor ruled out rises in VAT and indicated he would dedicate any windfall from lower than expected borrowing figures and unemployment to investments in the future, rather than extra departmental spending.

"If a politician offered Christmas trees the voters would roll their eyes and say, 'Oh well, you know you've clearly lost touch'," he argued.

Darling is expected to provide fresh detail on how government departments are meeting efficiency targets, deemed to be essential to plans to halve the deficit by 2013-14.

He also insisted there would not be an emergency budget after the election, and said he hoped the 50p income tax rate on those earning £150,000 or more would be a temporary feature of the tax landscape.

The government is expected to announce fresh measures to reduce youth unemployment, as well as some extra cash for defence.

Overall, the budget will represent a shift to a more European interventionist industrial policy. Darling and Lord Mandelson, the business secretary, believe the case for a more hands-on approach has been made by the success of limited state support for Nissan in Sunderland, which last week announced plans for a new electric car, and for Sheffield Forgemasters, one of only two plants in the world capable of making reactor vessels for the nuclear industry.

The High Speed 1 rail link was taken into public ownership last year, and Darling intends to use £1bn from the sell-off to attract a further £1bn from the private sector for a fund to be set up in 2011.

Other state assets earmarked for sale include the Dartford crossing and the Tote.

Treasury sources said Britain needed to spend £165bn over the next 15 years to replace 40% of its energy infrastructure, and public money had to be found – even in tough financial times – to attract private finance for new and unproven technologies. Mandelson's business department are also looking at using more active industrial policies – such as government procurement policies and small-scale loans – to help business recover from the deepest and longest recession since the second world war.

The budget is likely to set a target for the percentage of government business that should go to SMEs and propose an updated form of 3i, set up after the war to provide venture capital for start-up companies. "The fund is needed to deal with the problem of barriers to entry for private sector investment in technologies perceived to be high risk", a Treasury source said.

• Budget
• Alistair Darling
• Economic policy
• Green politics

In Silicon Valley, every startup fears than an established brand will one day acquire a rival or build a similar offering and instantly become the industry gorilla. When it comes to advertising, Google, which claims not only both the largest ad network and number of relationships with advertisers, but the most automated and profitable system on the Internet, is the most obvious example of this phenomenon. Ditto for Oracle and Cisco in the enterprise software space and eBay and Amazon in e-commerce.

Yet while fear of the 800-pound gorilla rightfully looms, upstart ad ventures can take heart in mounting evidence that suggests online ad categories are not cornered by deep-pocketed brands, but by new market entrants. This has held true across several different categories, including Google in search, DoubleClick in ad serving, Advertising.com in display, NexTag in CPA, RightMedia in exchanges and AdMob in mobile. Each of these companies emerged from humble beginnings to become billion-dollar businesses, and did so in the face of large, incumbent competitors. Additionally, a slew of other firms exited at valuations in the hundreds of millions of dollars, among them Overture (search), Atlas (ad serving), ValueClick (display) and Quattro (mobile), to name just a few.

So, what makes online ad categories so likely to be won by new entrants? History sheds some light:

First, on an economic front, online ad businesses exhibit clear network effects that ultimately preclude incumbents from contending in the category. When Advertising.com began to scale its network in the early 2000s, two trends emerged. As the company generated more leads for advertisers, the advertisers were willing to pay more per lead, and as it bought more inventory from publishers, they become more willing to accept lower per-impression CPMs. Per-impression ad-serving costs for DoubleClick and per-impression publisher onboarding costs for AdMob demonstrate similar network benefits. Each of these examples make clear that in online ad categories, new entrants grow so quickly that they effectively create a market dynamic in which slower-moving and less nimble incumbents simply can’t compete.

Second, on an innovation front, the classic innovator’s dilemma is unusually powerful in new ad categories because incumbents are hampered by legacy business models and technology infrastructure developed during a prior market development phase. When NexTag entered the education and finance lead-generation business, it brought with it a new model for buying traffic and valuing it on a per-impression basis based on advanced algorithms. Within a few years, NexTag’s internal media buying tools were so automated and accurate compared to the company’s predecessors that it was able to far out-pay for good inventory — and avoid paying for bad inventory at all. NexTag’s suite of media technologies put it at an advantage as the category grew and the cost of inventory rose, further enabling it to pull away from the pack and eventually exit for more than $1 billion. Incumbents often underestimate the importance of iterating early in a market, which means that as a category matures and the price of learning goes up, they find themselves falling behind.

Third, relationships with key inventory sources matter. On the Internet, there are millions of inventory sources, but only a few that can change the dynamics of the category. In search, it was the relationship that Google developed to monetize Yahoo search results. In display, it was Advertising.com’s entrenched relationship with the AIM client that enabled it to generate millions of dollars in profit from view-through conversions. And in exchanges it was the Yahoo partnership that solidified RightMedia as the No. 1 ad exchange. Incumbents seem more willing to give huge inventory opportunities to small, up-and-coming companies than they are to building out solutions internally. Such tight-knit relationships ensure the success of new entrants across the board.

The final lesson history has taught us is that focus leads to superior execution. Perhaps the least recognized but most valuable asset new entrants have is focus. In their respective times, Google was the best search engine, RightMedia was the best ad exchange and AdMob was the best mobile ad platform. Yes, incumbents often build a better product down the line (DoubleClick’s Ad Exchange is one example), but by that point the new entrant has already exited, as RightMedia did for $680 million. Incumbents know this fact implicitly, so it’s imperative that startups invest in and preserve their focus as they continue to grow.

The next generation of online ad categories is already repeating history. The key for investors and entrepreneurs is to identify which areas are going to be categories, not features, and get involved with them early.

Tod M. Sacerdoti is the CEO and co-founder of BrightRoll; follow him on Twitter at http://twitter.com/todsacerdoti. Disclosure: Brightroll is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

In the next few weeks, the ReadWriteWeb events guide will take you from New York City, to San Francisco, to Portland, Oregon. Along the way you'll find a conference on search engine strategies, a showcase for startups, an in-depth look at the freemium business model, and a day filled with of social media case studies.

How do you like your events calendar? As a world map? As an iCal (and Google Calendar-importable) file? You can also import individual events using the link beside each entry. Know of something cool taking place that should appear here? Let us know in the comments below or contact us.

Sponsor

Search Engine Strategies New York Conference & Expo

Go beyond search at Search Engine Strategies New York. Learn the newest trends, strategic action plans, and technology that industry leaders are employing today. Our experts will trace the natural evolution of search exploring topics such as: digital asset optimization, mobile application development, transition from search to discovery and more.Book your pass today. Enter RWW15 to save 15% off the registration. Sessions include:

• Digital Asset Optimization
• Deep Dive Into Analytics
• Augmented Reality: It's a Brave New World
• Bringing SEO In-House: The Pros and Cons
• Advanced B2B Search Marketing
• Duplicate Content & Multiple Site Issues

S.F. Beta 4.0

After a long winter's hiatus, S.F. Beta is back, for its forth year straight! Join hundreds of founders, investors, developers, and technologists for a lively evening of demos, drinks, conversation, and new connections. Early bird tickets are available, and they're going fast. Register now for discounted admission. As always, we feature startup demos all night. This time around, the theme is Search & Discovery. If you're building the next Google (or the next Google acquisition), we want you here! Email cperry@sfbeta.com for more info.

Freemium Summit

The first Freemium Summit is a one day event focused on exploring what it takes to succeed under the freemium business model. Across all segments of the media landscape, entrepreneurs and executives are pioneering models that combine a free offering with a premium, paid offering. This hybrid business model is one of the most exciting areas of business model innovation impacting the world of media and the Freemium Summit will explore the most important topics on the minds of leading practitioners.

Confirmed Speakers: Toni Schneider, Automattic (WordPress); Matt Brezina, Xobni; Aaron Levie, Box.net; Phil Libin, Evernote; Tom Conrad, Pandora; Drew Houston, Dropbox; Ranjith Kumaran, YouSendIt; Ben Chestnut, Mailchimp; Lance Walley, Chargify; Isaac Hall, Recurly; and Lincoln Murphy, Sixteen Ventures.

Social Fresh Portland

The social media conference for marketers, Social Fresh is not about concept, but focused purely on case studies from the front lines. Learn what social media can really do for business bottom lines. Over the course of the day, you'll hear from 35 speakers from companies like Intel, Ford, Comcast, Nike and many more, as well as keynote Peter Shankman. Register now and use coupon code RWW15 for 15% off.

ConnectNow

TEDx CMU is an independently organized TEDx event that will be held on April 4th, 2010 at Carnegie Mellon University and will feature a full day of talks by prominent speakers as well as recorded videos from past TEDTalks. Confirmed speakers include Jonathan Fields (author, blogger and entrepreneur), Stacey Monk (founder of Epic Change, a startup nonprofit), Chase Jarvis (photographer, director and social artist) and Nathan Martin (CEO of Deeplocal, an innovation studio in Pittsburgh).

The theme of the event is "Fearless", and we are inviting speakers from cross-disciplinary backgrounds to talk about their experiences, and tell us a little about what inspires them to be fearless in the pursuit of goals. We hope to spark discussions and foster connections between participants, encouraging aspiring individuals to follow their dreams and make a difference. The event is free to attend, and the application deadline is March 21, 2010.

For more information about the event, visit tedxcmu.com or email info@tedxcmu.com. You can also find TEDx CMU on Facebook or follow us on Twitter.

ConnectNow

ConnectNow brings together international specialists and thought leaders in social media, emerging technologies and their intersection with business. Learn how the realtime web, location based services, augmented reality, ubiquitous computing and personalised services are changing marketing and communications. Understand the importance of trust in relationship marketing and what is "social currency". For more info email info@connectnow.net.au.

PubCon South

PubCon, the premier search and social media conference, features the industry's biggest names and key players shaping the future of the Web. PubCon South will include cutting-edge panel sessions exploring tracks dedicated to search, social media and affiliate marketing, an intensive professional search and social media training program, and some of the world's top keynote speakers. PubCon South at Dallas will also hold a one-day, two-track slate of intensive educational training programs led by some of the industry's most respected search professionals. The event takes place at the Richardson Conference and Civic Center. Register here.

Under the Radar: Cloud

Under the Radar: Cloud is must-attend event for dealmakers and heads of IT from large enterprises, SMBs, service providers, carriers and media companies who are responsible for helping their companies leverage new technology and innovation in the fast-evolving IT ecosystem. Join us for the 15th Under the Radar conference, featuring a hand-picked selection of the world's most innovative cloud startups among 350 top tech, media, telcom and finance executives. For ticket and more information, visit http://undertheradarblog.com.

FutureMidwest

FutureMidwest is the region's largest technology and knowledge conference. Founded by Adrian Pittman, Jordan Wolfe and Zach Lipson, FutureMidwest is the fusion of two successful conferences held in Michigan in 2009 - the Module Midwest Digital Conference and TechNow.

Both conferences highlighted how technology and digital tools have dramatically changed the way we do business and the effect this transition has had on companies. FutureMidwest kicks things up a notch with presentations, group breakout sessions, relationship-building opportunities and influencers who are taking action to redefine business in the digital age. Register here.

Social Fresh St. Louis

The social media conference for marketers, Social Fresh is not about concept, but focused purely on case studies from the front lines. Learn what social media can really do for business bottom lines. Over the course of the day you'll hear from 35 speakers from companies like Ford, Best Buy, Scottrade, Hardees, CMT and many more. Register now and use coupon code RWW15 for 15% off.

DrupalCon

DrupalCon is the premier conference focused on Drupal, the award-winning open source content management framework that is galvanizing social publishing and web development today. For a registration fee of $195, attendees get three full days of sessions led by the best and brightest Drupal experts.

Drupal has been downloaded over 2 million times since its inception, and project growth has doubled annually for several years. Drupal is used to deliver a wide variety of application types including blogs, wikis, community networks, digital media portals, and web content publishing and management.

Future of Money and Technology Summit

The Future of Money & Technology Summit will bring together the best and brightest thinkers around money, including visionaries, entrepreneurial business people, developers, press, investors, authors, solution/service providers, and organizations who work where cash and commerce collide. We meet to discuss the evolving ecosystem around money in a proactive, conducive to dealmaking environment. Featured speakers include Jolie O'Dell from ReadWriteWeb, as well as representatives from Wells Fargo Bank, Kiva, SharesPost, Jambool, Founders Fund, Outright.com, SoftTech VC, and many more.

Use discount code "rww" to get 10% off registration.

ReadWriteWeb Mobile Summit 2010

The ReadWriteWeb Mobile Summit 2010 will be an exploration of the latest Mobile development trends - both the technology and the emerging business applications. Get ready to explore, think and create the future of Mobile with the brightest in the industry, your peers! As in our last Summit, The Real-Time Web, the ReadWriteWeb Mobile Summit is an unconference.

An unconference is a participant driven conference where the agenda is created on the day, in real-time and discussions are lead by conference participants. Read about the history of unconferences.

We will have two main tracks at this Summit - Development and Business - so the Summit will be of interest to managers, marketers, developers, innovators, entrepreneurs and thought leaders alike. Here's a sample of some of the topics we'll explore in both of these tracks.

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• Geo-location services - what can you do using location as a platform?
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• Commerce & Marketing - as more and more consumers use smartphones, how can businesses utilize this channel?
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• Content, Publishing & Recommendations - the technologies and best practices.
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• Mobile Social Networking - how to tap into communities on mobile devices.
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• Internet of Things - the emerging opportunities from sensor and RFID data.
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• Augmented Reality - the technology and business applications of AR.
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• Native App vs. Browser Based - Including iPhone, Android, RIM, Palm, Windows Mobile and Symbian.
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Click here to register now, or to become a sponsor, or to help shape the conference.

FinovateSpring

FinovateSpring 2010 will again showcase the most cutting-edge financial and banking technology innovations to Silicon Valley and the world. With Finovate's signature mix of short, fast-paced onstage demos (no slides are allowed) from handpicked companies and intimate networking time with their executives, this conference packs a ton of unique value into a single day.

Come see the cutting edge of banking and financial technology and network with hundreds of the leading financial executives, venture capitalists, press, industry analysts, bloggers and fintech entrepreneurs. Early bird registration rates are available.

SF MusicTech Summit

The SF MusicTech Summit will bring together 700-plus visionaries in the music/technology space - the best and brightest entrepreneurs, developers, investors, service providers, journalists, musicians and organizations who work with them at the convergence of culture and commerce. We meet to discuss the evolving music, business and technology ecosystem in a proactive, conducive-to-dealmaking environment. Enter the discount code "rww" to get 10% off.

25 – 27 May 2010: Denver, Colorado

Glue

Glue is the only conference devoted solely to exploring the problem-sets facing architects, developers and IT professionals in a "post-cloud" world. Glue focuses on the APIs and protocols (Twitter, Facebook, Websockets, PubSubHubBub, XMPP), formats and standards (RDF/Linked Data, JSON, Microformats, HTML5), platforms and providers (Amazon, Rackspace, Google App Engine, Salesforce.com, Eucalyptus), Identity Protocols (OAuth/WRAP, SAML, OpenID, SPML) emerging NoSQL data models (Cassandra, CouchDB, MongoDB, Riak, HBase), and other mechanisms that are building the post-cloud world.

ReadWriteCloud will be blogging live from Gluecon and CloudCamp, and ReadWriteWeb's Alex Williams will be moderating the "Managing Complexity in the Cloud" session. Please join us May 25-27 in Denver, Colorado. ReadWriteWeb readers can receive 10% off of registration by using the code "RWW12".

Corporate Social Media Summit

The Corporate Social Media Summit is a two day conference focused exclusively on how big businesses can take advantage of social media to enhance their marketing/comms strategy. Featuring:

• Practical and relevant insights from peers who have already used social media successfully
• 20-plus corporate speakers (including PepsiCo, Whole Foods, Dell, McDonald's, General Motors, Citi, Johnson & Johnson),
• Best practice, benchmarks and practical next steps you can use to take advantage of social media in your business
• A tightly-focused agenda with 14 in-depth, practical workshops giving you knowledge on only the most critical business issues surrounding corporate use of social media

Cloud Computing World Forum

The 2nd annual Cloud Computing World Forum is the perfect event to learn and discuss the development, integration, adoption and future of cloud computing and SaaS. Building on the success of the 2009 show, this two day conference and free-to-attend exhibition will provide a focused platform for the global cloud and SaaS industry. Show highlights include:

• Co-located with CloudCamp London
• Co-located with Green IT conference
• Free-to-attend exhibition with seminar and scenario theatre
• Free-to-attend evening awards presentation
• Hear from leading case studies on how they have integrated cloud computing and SaaS into their working practices
• Learn from the key players offering cloud and SaaS services
• Evening networking party for all attendees

FinovateFall

FinovateFall will return to Manhattan on Tuesday, October 5 to showcase dozens of the biggest and most innovative new ideas in financial and banking technology from established leaders(...)

Less than two months after talking up the turnaround at Dow Jones-IAC (NSDQ: IACI) personal finance JV FiLife, paidContent has learned the site’s continued existence is no certainty. It survived the multiple trimmings as Barry Diller cut back on IAC’s portfolio of emerging businesses, but the company is now exploring options that range from leaving it open to a sale or a full shut down. When Ezra Kucharz, president and GM for just over a year, left for CBS (NYSE: CBS) in January, both IAC and DJ credited him publicly with turning around the site and building it to 4.4 million unique visitors in December. Now both companies are declining comment about the site’s future.

Less than two months after talking up the turnaround at Dow Jones-IAC (NSDQ: IACI) personal finance JV FiLife, paidContent has learned the site’s continued existence is no certainty. It survived the multiple trimmings as Barry Diller cut back on IAC’s portfolio of emerging businesses, but the company is now exploring options that range from leaving it open to a sale or a full shut down. When Ezra Kucharz, president and GM for just over a year, left for CBS (NYSE: CBS) in January, both IAC and DJ credited him publicly with turning around the site and building it to 4.4 million unique visitors in December. Now both companies are declining comment about the site’s future.