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Mobile Advertising Comes Of Age

Source: http://www.businessinsider.com/millennial-media-ipo-2012-1

 

millennial media ad impressionsMillennial Media, a mobile advertising network, filed for an IPO last week. We were waiting for this, as we’d predicted this would happen this year (though we didn’t think it would happen so soon).

How is Millennial Media’s business?

Pretty good, actually.

Here are the highlights:

  • The company generated $70 million in revenue in the first nine months of 2011, from just $6.2 million in 2008;
  • The company has never had a profitable quarter and is still losing money, $4 million for the first nine months of 2011.
  • It’s pretty big and growing pretty fast: it processed 40 billion ad impressions in December 2011, and impressions are growing fast (see chart); Millennial Media has 16.7% marketshare according to IDC.

The Business

millennial media revenues and lossesYou’ll almost certainly see plenty of headlines about Millennial “never turning in a profit” throughout its road show. That’s correct. It’s also irrelevant.

Millennial is growing fast and into an enormous market opportunity–mobile advertising. It should not be profitable. Gartner thinks mobile advertising will be a $20.6 billion market by 2015, which may be conservative. That’s the opportunity Millennial is going after.

What’s more, Millennial Media seems to be gaining both market and operating leverage.

millennial media advertisersMillennial Media’s gross margin, which is roughly the amount it keeps after payments to publishers, improved from 34% to 39% in the first nine months of 2011 compared to the same period in 2010. This is happening as Millennial is growing both advertisers and spending per advertisers, as you can see in the chart at right.

What’s more, Millennial’s losses are narrowing, as you can see in the chart above.

All of this suggests that Millennial is gaining both market leverage–as it gets more established it can keep more of the revenue it generates for publishers–and operating leverage–gaining operational efficiencies as it scales up.

The Market

Mobile Advertising RevenueOne thing people might be worried about is competition from Apple and Google. We’re not. Here’s why:

  • Even though Google is much bigger than Millennial (see chart at right, using data aggregated and estimated by Business Insider Intelligence), most of that is on owned-and-operated properties. Google’s AdMob network is bigger than Millennial’s but it is not dominant.
  • Apple’s online advertising format/network, iAds, has struggled in the marketplace.
  • Ad networks are not a winner take all market. On the web, there are a few giants, and many profitable smaller players. There’s no reason why it couldn’t be the same on mobile, and Millennial, as the biggest independent player, is well positioned.

THE BOTTOM LINE: Millennial Media looks like a strong business scaling up nicely in an exciting, fast-growing market. It’s kind of a boring business–an ad network, but it seems to be executing well. More importantly, don’t trust the media reports that will inevitably bang on about how Millennial has never been profitable. Yes, that’s true, but it doesn’t matter.

 

 

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Tuesday, January 10th, 2012 news No Comments

More and more tools to block ads and other “distractions”

As more and more users adopt tools to de-clutter web pages and remove all distractions (such as ads) the effectiveness of display ads will continue to decline, despite innovations and advancements in targeting technologies.

Source: http://lifehacker.com/5568752/add-safari-reader+like-powers-to-firefox-and-chrome

Add Safari Reader-Like Powers to Firefox and ChromeThe Safari 5 feature that’s caught the web’s attention is the Reader button, which strips down articles and blog posts into an ad-free, highly readable format. Two add-ons for Firefox and Chrome do a good job of recreating that convenience.

Add Safari Reader-Like Powers to Firefox and ChromeIf you missed our round-up of what’s new in Safari 5, the short explanation of Reader is that, while many bookmarklets have come along to offer a simplified, less-cluttered reading experience, Safari is the first major browser to go ahead and offer that kind of feature by default, as an address bar button. If you’re a fan of bookmarklets, and your bookmarks aren’t too cluttered to lose them in, we recommend the tools from arc90’s Readability, the Instapaper Text bookmarklet, and the Readable app for highly customized formatting.

But maybe you want your Firefox or Chrome rig to offer that kind of button-click functionality. You’re in luck. First off, here’s the Top 10 feature we’ll try our reading tools out on—click the image for a larger view:

Add Safari Reader-Like Powers to Firefox and Chrome

Now here are two add-ons for Firefox and Chrome, and a look at how they do at getting all minimalist with the text and pics. Click any of the images below, too, for a larger view

Readability (Firefox)

Add Safari Reader-Like Powers to Firefox and Chrome
Baris Derin rolled the Readability bookmarklet into a full-fledged add-on for Firefox, but also added in a pretty neat auto-scrolling feature for the true lean-back-and-read experience. Readability tends to keep more of the text and formatting in and around the page, but strips out all the marketing and navigation material. It places an “R” button in the lower-right status area of Firefox, which isn’t the most convenient spot for our use, but some may prefer having it hidden away until needed. Notice the transparent icons, too, that provide printing, email, and refresh functions for live-updating posts.

iReader (Chrome)

Add Safari Reader-Like Powers to Firefox and ChromeMhd Hejazi’s iReader is directly inspired by Safari’s Reader function, offering the same kind of pop-out white box that darkens the rest of the page, a button right in the address bar, and very, very minimal decoration—as you can see, it pared down our Top 10 feature quite a bit. There are also keyboard shortcuts for Windows and Mac to activate iReader, and options to change the background opacity, font and formatting, and add a “Send with Gmail” link to your articles. Neat stuff.


Both add-ons are free downloads. Know of another reading/simplifying extension that gets the job done? Tell us about it in the comments. Thanks to emmikkelsen for the inspiration!

Readability [Add-ons for Firefox]
iReader [Google Chrome extension gallery]

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Monday, June 21st, 2010 news No Comments

How Google Crunches All That Data

Source: http://gizmodo.com/5495097/how-google-crunches-all-that-data

If data centers are the brains of an information company, then Google is one of the brainiest there is. Though always evolving, it is, fundamentally, in the business of knowing everything. Here are some of the ways it stays sharp.

For tackling massive amounts of data, the main weapon in Google’s arsenal is MapReduce, a system developed by the company itself. Whereas other frameworks require a thoroughly tagged and rigorously organized database, MapReduce breaks the process down into simple steps, allowing it to deal with any type of data, which it distributes across a legion of machines.

Looking at MapReduce in 2008, Wired imagined the task of determining word frequency in Google Books. As its name would suggest, the MapReduce magic comes from two main steps: mapping and reducing.

The first of these, the mapping, is where MapReduce is unique. A master computer evaluates the request and then divvies it up into smaller, more manageable “sub-problems,” which are assigned to other computers. These sub-problems, in turn, may be divided up even further, depending on the complexity of the data set. In our example, the entirety of Google Books would be split, say, by author (but more likely by the order in which they were scanned, or something like that) and distributed to the worker computers.

Then the data is saved. To maximize efficiency, it remains on the worker computers’ local hard drives, as opposed to being sent, the whole petabyte-scale mess of it, back to some central location. Then comes the second central step: reduction. Other worker machines are assigned specifically to the task of grabbing the data from the computers that crunched it and paring it down to a format suitable for solving the problem at hand. In the Google Books example, this second set of machines would reduce and compile the processed data into lists of individual words and the frequency with which they appeared across Google’s digital library.

The finished product of the MapReduce system is, as Wired says, a “data set about your data,” one that has been crafted specifically to answer the initial question. In this case, the new data set would let you query any word and see how often it appeared in Google Books.

MapReduce is one way in which Google manipulates its massive amounts of data, sorting and resorting it into different sets that reveal new meanings and have unique uses. But another Herculean task Google faces is dealing with data that’s not already on its machines. It’s one of the most daunting data sets of all: the internet.

Last month, Wired got a rare look at the “algorithm that rules the web,” and the gist of it is that there is no single, set algorithm. Rather, Google rules the internet by constantly refining its search technologies, charting new territories like social media and refining the ones in which users tread most often with personalized searches.

But of course it’s not just about matching the terms people search for to the web sites that contain them. Amit Singhal, a Google Search guru, explains, “you are not matching words; you are actually trying to match meaning.”

Words are a finite data set. And you don’t need an entire data center to store them—a dictionary does just fine. But meaning is perhaps the most profound data set humanity has ever produced, and it’s one we’re charged with managing every day. Our own mental MapReduce probes for intent and scans for context, informing how we respond to the world around us.

In a sense, Google’s memory may be better than any one individual’s, and complex frameworks like MapReduce ensure that it will only continue to outpace us in that respect. But in terms of the capacity to process meaning, in all of its nuance, any one person could outperform all the machines in the Googleplex. For now, anyway. [Wired, Wikipedia, and Wired]

Image credit CNET

Memory [Forever] is our week-long consideration of what it really means when our memories, encoded in bits, flow in a million directions, and might truly live forever.

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Wednesday, March 17th, 2010 news No Comments

Dr. Augustine Fou is Digital Consigliere to marketing executives, advising them on digital strategy and Unified Marketing(tm). Dr Fou has over 17 years of in-the-trenches, hands-on experience, which enables him to provide objective, in-depth assessments of their current marketing programs and recommendations for improving business impact and ROI using digital insights.

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