jump to navigation

Serial Entrepreneur on Starting a Company in LA… April 11, 2008

Posted by Bill in exchanges, Right Media.
add a comment

I love Frank Addante because he is one of the only internet ad executives who looks younger than I do… I am not quite sure how old he actually is, but he definitely is NOT 18! We crossed paths briefly when I became CEO of a company he had earlier sold an ad server to.

In any case, I met with Frank a few weeks ago (he is founder and CEO of the Rubicon Project), and he is a great leader. This video is hysterical… enjoy!

Advertisements

Traditional Publishers Need to Become Ad Networks Themselves… March 24, 2008

Posted by Bill in ad networks, Ad Serving, exchanges, Online Advertising, Press Mentions, Right Media, traditional advertising.
1 comment so far

A lot is being written about online media not being sold like “pork bellies”, or as a commodity. Those people are missing the point of the importance of syndication in today’s market. Publishers may not opt to send remnant inventory to ad networks, but rather BECOME ad networks themselves. Martha is doing it. Forbes is doing it. Viacom already does it.

Mike Shields of MediaWeek wrote a decent article summarizing this. While I think he missed my main point, the article is a good read….

ESPN Turns Off Ad Nets to Protect Brand, Content

The site recently cut ties with Specific Media and several other unnamed ad networks, and is taking the bold stand that ad selling that relies heavily on arbitrage and algorithms is not for them.

Mike Shields

Top Web publishers are planning a revolt. Even as more prominent sites experiment with selling remnant inventory through online ad networks, and in some cases ad exchanges, ESPN.com is saying thanks, but no thanks.

The site recently cut ties with Specific Media and several other unnamed ad networks, and is taking the bold stand that ad selling that relies heavily on arbitrage and algorithms is not for them.

“We’re heading down a path where it no longer suits our business needs to work with ad networks,” said Eric Johnson executive vp, multimedia sales, ESPN Customer Marketing and Sales. Sources say that ESPN would like to rally support from other publishers behind this move, and ultimately tamp down ad networks’ growth. Turner’s digital ad sales wing is rumored to be considering a similar move, though officials said no decisions are imminent.

“Turner, like a lot of media companies, is currently reviewing all of its media practices, and ad networks are certainly a part of that process,” said Walker Jacobs, senior vp of Turner Entertainment New Media Ad Sales.

ESPN’s decision crystallizes a philosophical debate in the online ad sales industry that has intensified since the Interactive Advertising Bureau’s annual meeting last month, when during a keynote address Martha Stewart Living Omnimedia media president Wenda Harris Millard gave her now famous warning against selling Web inventory like “pork bellies.”

Two sides have formed—those who want to protect traditional, direct selling of premium content brands, and the math-loving crowd which favors automation and data. The math lovers make the traditional sellers nervous.

“There is a genuine concern about commoditization of brand inventory by some of the networks,” said Millard in an interview. She’s concerned that such a debate is happening so early in the Web’s development as a business. “We haven’t even established the value of our medium, and all of a sudden it’s about price. That is very bothersome to people who are brand stewards.”

Of course, there’s a reason that online ad networks, which rose to prominence in the late ’90s by aggregating inventory across thousands of smaller Web sites, are playing a bigger role in Web publishing. Most large sites are swimming in avails they can’t sell. Insiders estimate that 20 percent to as much as 70 percent of inventory can go unsold at a given time. Thus, ad networks offer a monetization alternative.

And in recent years, to differentiate themselves, more of these companies have been touting themselves as ‘premium” ad networks, talking up their associations with the ESPNs of the world when they meet with ad agencies. “Nobody comes into a meeting and says, ‘I’ve got a bunch of lousy sites,’” said Mike Cassidy, CEO of Undertone Networks.

That doesn’t sit well with some publishers, like ESPN, who see networks as profiting on their brand investments and their user data, while also threatening their own marketer relationships. Many just think using networks devalues the power of content.

Several publishers, in conversations with Mediaweek, privately applauded ESPN, and hoped that others would follow suit. But applause doesn’t necessarily translate to action.

“I don’t see it happening,” said John Battelle founder/chairman/CEO Federated Media, a company that represents numerous blogs. “I suppose certain premium brands could say, ‘I’m above the fray. Our inventory is all very valuable.’ With that there are some problems.”

Central among those problems is that in this accountability-driven quarter-by-quarter business climate, it’s hard for any publisher to walk away from revenue, even if it’s not huge.

“Not all inventory is created equal,” said, Peter Naylor, senior vp, digital media sales, NBC Universal. For example, Naylor said iVillage’s Horoscope section generates a lot of traffic, but doesn’t attract many endemic advertisers. Thus, he turns to networks.

According to Pam Horan, president of the Online Publishers Association, most publishers do just that.

For example, MTV Networks recently inked a deal with Microsoft to let the software giant sell its remnant inventory. Nada Stirratt, executive vp, MTV Networks Digital Media (herself a former top sales exec at ad net giant Advertising.com) said that ad networks “absolutely have a place for high frequency, low value impressions.” Plus, she likes tapping into Microsoft’s tech expertise, and is comfortable with the numerous safeguards the deal offers.

Even Tina Sharkey, chairman, BabyCenter.com (and a former AOL exec) who gave a well-received presentation of the value of branded sites relationships with their readers at the IAB meeting, defended the network model. “Ad networks play a vital role in the online advertising ecosystem.”

So can ESPN change the model? “It won’t have the desired impact,” said Adam Kasper, senior vp, director of digital media Media Contacts—unless the top ten or so Web sites followed suit.

The networks themselves don’t seem worried. Tim Vanderhook, co-founder of Specific Media, said he hopes that his company would end up working with ESPN again in the future, and doesn’t believe that big name publishers can afford to ignore networks. down the road.
“Specific Media’s publishing partners come and go in the network throughout the year as we constantly assess the cost and performance of their ad inventory for our advertisers,” he said.
“If several, or even all, big name publishers stopped working with us, it would hurt the publishers themselves more than us…The online advertising business is all about targeting and publishers can’t do it on their own because they don’t have enough data.”

Kasper, and many others, believe that data will be essential to online advertising’s future.
“They’re [ESPN] essentially fighting technology. That’s a hard thing to do.”

But ESPN and other publishers may opt to invest in their own ad targeting technology. In the meantime, they’ve got the option of trying ad exchanges, which promise more control.
“We think of the exchange as a solution to all of these discussions,” said Bill Wise, general manger, global exchange, Yahoo – which acquired the exchange company Right Media last year.

Wise emphasized that since exchange companies don’t purport to be ad sellers, but rather provide a selling platform, they are safer than ad networks. “You take a big risk in letting other people represent your brand,” he said.

As for commodization fears, Wise quipped, “Well, gold is a commodity.”

Web 3.0– Predictions for 2008 (Part I) January 4, 2008

Posted by Bill in ad networks, Behaviorial Marketing, exchanges, mobile marketing, Online Advertising, online marketing, Right Media, social network, traditional advertising, video.
1 comment so far

1. Ad Networks need to go deep to strive. Ad Networks need to offer true differentiation and add unique value. I predict the untargeted or performance-based ad networks lose ground to the portals who are building their own ad networks, and to vertical ad networks and data/ behavioral ad networks who are building a defensible deep expertise.

2. Local & SMB market get to critical mass for a handful of players and the search engines pay attention to them. Its about time…

3. Video continues to not have a standard ad unit, but continues to take huge mindshare within brand departments, ad agencies, brand publishers and portals… and amongst the press, who loves to talk about the broadcast dollars shifting.

4. Mobile explodes. Similar to the social networks in 2007, huge amounts of venture capital will pour into this market without a material focus on established revenue streams.

5. Ad Exchanges go mainstream…!!!

More to come in Part II…

Yahoo Acquires Right Media April 30, 2007

Posted by Bill in Auction-based media, exchanges, Google, Online Advertising, online marketing, Right Media, Yahoo Search Marketing.
2 comments

Fun days here at Right Media… I have been incredibly impressed with Yahoo!s strategic vision and commitment to the exchange model through the process. I think this will be a great marriage. More importantly, it makes the competition with GoogleClick that much more exciting!

Official Press Release: Yahoo! Announces Agreement to Acquire Right Media, Largest Emerging Online Advertising Exchange

New York Times: Yahoo to Buy Ad Company in Bid to Compete With Google

Some excerpts from the above New York Times article, by MIGUEL HELFT:

– “The acquisition, to us, is a key step toward executing our long-term vision to build the leading advertising and publisher ecosystem both on and off the Yahoo network,” Terry S. Semel, Yahoo’s chief executive, said in an interview. The deal is to be announced today and is expected to close in three months.

– Right Media, a four-year-old company, runs an exchange in which advertisers and publishers buy and sell online ad placements in real time through an auction system. DoubleClick, which specializes in serving ads on Web sites, announced recently that it would develop a similar type of exchange. Online publishers are increasingly turning to exchanges like these to sell ad space on their sites.

– “What we look forward to do as an owner is put more inventory into that pot to help create a more vibrant exchange and create better pricing for everyone,” Mr. Semel said.

– Yahoo said that after the acquisition it would increase its participation in the exchange as both a buyer and seller of ads. The company said it planned eventually to sell all the nonpremium ad space on Yahoo through the exchange, a move executives said would enhance revenue.

– Google and Yahoo each dominate one segment of the online advertising market. Google is best at selling text ads that appear alongside search results and on other Web sites. Yahoo, which has lagged Google in search, is a leader in selling graphical ads, mostly on its own sites.

– By buying Right Media, analysts have said, Yahoo would accelerate its own efforts to sell and broker ads on other sites. Those efforts began taking shape recently, after Yahoo reached agreements to sell ads on eBay and on some 264 newspaper Web sites.

(Note: For the math impaired, $680 million for the remaining 80% that Yahoo! didn’t yet own is equal to an $850 million in total valuation…)