publishers

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.

 

 

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Tuesday, January 10th, 2012 news No Comments

Why Google Is The Grinch Who Stole Your Business

Source: http://www.businessinsider.com/the-grinch-who-stole-your-business-2011-12


Google Sign

It’s that time of year when we all reflect on the past, search our souls and determine what we want for the next year. I’ve been reflecting on what it means to work with a company that controls so much of the market, provides such a broad set of capabilities and delivers such a large percentage of monthly revenues to publishers. Of course, I’m thinking of Google and what their dominance in the ad market means for a publisher’s future and its ability to remain relevant to marketers.

What do we know about Google? They are this great company that gives consumers some of the best digital products available on the Web: search, email, maps, Android, apps and more. This has catapulted Google to the rank of second most valuable brand, behind only Apple, according to Millward Brown. This seems to be great for consumers, but what about the businesses who are now reliant on Google for search and display revenue, advertising technology and various business applications like Google docs, Android OS, Chrome, etc.?

Many of the businesses I meet with hold Google in high regard because of the products they represent and the amount of revenue they provide. However, these businesses are equally concerned about Google’s consumer stranglehold, their influence over the ad ecosystem and their focus on automation, all of which lessens the publishers’ worth in the value chain as a whole. Google’s market dominance stretches well beyond search, which in itself is obviously enormous. This expansive dominance should be alarming for every marketing-related business, including publishers, advertisers and agency and marketing services technologies.  Here are a few stats on Google by category that will likely frighten even the largest of these businesses:

  • 65.38% Share of Search, Oct-11 Hitwise
  • 44.1% Share of Ad revenue, Oct-11 PCMag
  • 43.8% Share for Video, Oct-11 Comsccore
  • 30.03% Share for Travel, Oct-11 Comscore
  • 22.38% Share for Automotive, Oct-11 Comscore
  • 18.69% Share for Shopping, Oct-11 Comscore
  • 16.29% Share for Health, Oct-11 Comscore

If these stats weren’t enough to dampen your holiday spirit, Google now is even prioritizing their own products above the paid search listings on their search engine. This creates a major conflict for the advertisers that have made Google what it is today and may force those clients to pay even more if their advertising is to remain competitive in this new bidding landscape. Google clearly is leveraging its position of power with consumers to launch new products and ensure their own success. The latest example of this is the promotion of their Chrome browser on the Google homepage. As you can see from the chart below, Chrome is rocketing to the position of #1 browser, a rank it is projected to achieve by June 2012.

Google is now a major threat to every business in the publishing and advertising marketplace. In the short term, while they may appear to be a superior partner that provides revenue and marketing innovation, I believe that over the long term they are eroding the value of each and every business in the media sales and publishing value chain. And, worst of all, they are charging heavily for the privilege. I’d estimate that for every dollar spent by an advertiser in the media buying process, Google captures upwards of 25% in tolls (via their various ad services, DFA, Invite, DFP, AdX, Motif, Admeld, etc.), thereby minimizing revenue and profits for publishers and other vendors along the way

So as you reflect on 2011 and consider whom you want to partner with in 2012, give some thought to the short versus the long term. What is your value proposition to clients? And who do you ultimately want to run your business … the Grinch or You?

Have a great holiday and Happy New Year!

The views expressed here reflect the views of the author alone, and do not necessarily reflect the views of 24/7 Real Media, its affiliates, subsidiaries or its parent company, WPP plc

Please follow Advertising on Twitter and Facebook.

Join the conversation about this story »

See Also:




drag2share – drag and drop RSS news items on your email contacts to share (click SEE DEMO)

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Tuesday, December 27th, 2011 news No Comments

How Apple’s Magazine Subscription Plan Helped Sell More Copies Of Popular Science (AAPL)

Source: http://www.businessinsider.com/chart-of-the-day-ipad-subs-2011-12

We’re still in the early days of magazines on tablets, but this chart from Peter Kafka at All Things D showing sales of Popular Science’s iPad app looks pretty decent for publishers.

As you can see sales have been steadily climbing and got a nice boost when Apple introduced the “newsstand,” which makes it easier for users to subscribe to magazines.

chart of the day, cumulative subscription sales through itunes, dec 23 2011

Please follow SAI on Twitter and Facebook.

Join the conversation about this story »

See Also:


drag2share – drag and drop RSS news items on your email contacts to share (click SEE DEMO)

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Sunday, December 25th, 2011 news No Comments

Facebook Owns 95% Of Social Networking Time

Source: http://www.businessinsider.com/chart-of-the-day-facebook-owns-95-of-social-networking-time-2011-12


Facebook accounts for 95% of social networking time on the web in the U.S. according to an analysis of comScore data provided to us by web publisher Ben Elowitz of Wetpaint.

(We would think this holds for mobile, but it’s possible Twitter has more of a hold there than on the desktop.)

Elowitz’s takeaway from the data: “There’s now no question that ‘social’ means ‘Facebook.'” And if you want to be in front of consumers, you have to figure out a way to be in their Facebook news feed.

This is important for Facebook, since it just announced plans to insert ads into users news feeds. If publishers agree with Elowitz, then it could be the big revenue generator Facebook needs to sustain itself for the next ten years.

chart of the day, minutes spent on social newtworking sites, dec 20 2011

Please follow SAI on Twitter and Facebook.

Join the conversation about this story »

See Also:




drag2share – drag and drop RSS news items on your email contacts to share (click SEE DEMO)

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Tuesday, December 20th, 2011 news No Comments

Google Gets Serious About Youtube Royalties with Rightsflow Purchase [Google]

Source: http://gizmodo.com/5867476/google-gets-serious-about-youtube-royalties-with-rightsflow-purchase

Google Gets Serious About Youtube Royalties with Rightsflow PurchaseGoogle announced on Friday that it has purchased the music licensing company RightsFlow for its detailed information about who should get paid when any of over 30 million songs get played.

Neither Google nor Rightsflow would comment on the deal beyond their official statements, but we have pieced together some of the reasons Google would purchase a music licensing company like RightsFlow, which deals with “mechanical” royalties owed to songwriters, publishers, and other copyright holders. They whenever a non-human thing – like a compact disc, website, or music app –plays music.

RightsFlow, pictured here, now belongs to Google, which will use it to simplify royalty accounting on YouTube and possibly other music services.

The big reason Google would do this is that YouTube continues to be such a massive free music destination. It simply made more sense to buy RightsFlow outright to help keep its administrative and legal costs down, than to continue to rely on its services alongside other RightsFlow clients such as Rhapsody.

To be clear, this doesn’t give Google any rights to this music; it just makes those rights easier to deal with.

The acquisition, announced on Friday (when companies typically announce stuff they don’t want people paying attention to) is more evidence that Google is serious about YouTube as a free music destination. It should now be able to add even more music without worrying as much about lawsuits or expensive accounting.

Once Google has identified songs uploaded to YouTube using its Content ID fingerprinting technology, it should be able to figure out more easily which publishers and songwriters to pay. This could also help Google deal with its Google music store or other Google stuff in the future, although for now, Google’s focus for this deal is squarely on YouTube.

RightsFlow, recently named the #8 most desirable place to work in New York by Crain’s New York Business, owns information that is mostly publicly available. What makes it valuable is its ability to search all that data, making it easier to license lots of songs at once.

So, basically, Google just acquired a search engine, sort of like Google itself – except now, it could just have just one (admittedly very busy) user.

Google Gets Serious About Youtube Royalties with Rightsflow Purchase Evolver.fm observes, tracks and analyzes the music apps scene, with the belief that it’s crucial to how humans experience music, and how that experience is evolving.


drag2share – drag and drop RSS news items on your email contacts to share (click SEE DEMO)

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Tuesday, December 13th, 2011 news No Comments

The Reason Why Publishers Started Putting Their Magazines on the iPad

Source: http://gizmodo.com/5801045/the-reason-why-publishers-started-putting-their-magazines-on-the-ipad

When Apple announced their digital subscription rules and locked down the iPad, publishers weren’t exactly rushing to bring their subscriptions over. And then all of a sudden Conde Nast, Hearst, and Time Inc brought their magazines to the iPad. What changed?

According to Forbes, the biggest hurdle for publishers wasn’t the 30% cut that Apple was going to take away from them, but rather the lack of information on the subscribers. They were worried that because users get to ‘opt in’ to giving up their personal information that nobody would do it. They were wrong. In fact, 50% of subscribers have been giving publishers their information.

Having that sort of basic subscriber info is necessary for publishers to do business. Now that they find Apple’s terms workable, it wouldn’t be a surprise to see more and more magazines come over to the iPad with agreeable deals. Which is a very good thing for people like me who prefer to read (and kill my eyes) on a screen. [Forbes]

Tags: , , , , , , , , , , , , , ,

Wednesday, May 11th, 2011 news No Comments

The Half-Life Of A YouTube Video Is 6 Days (GOOG)

Source: http://www.businessinsider.com/chart-of-the-day-the-lifecycle-of-a-youtube-video-2010-5

button more charts
button chart prev button chart next

A video on YouTube gets 50% of its views in the first 6 days it is on the site, according to data from analytics firm TubeMogul. After 20 days, a YouTube video has had 75% of its total views.

That’s a really short life span for YouTube videos, and it’s probably getting shorter. In 2008, it took 14 days for a video to get 50% of its views and 44 days to get 75% of its views.

Why? In the last two years, YouTube has improved its user interface, which helps videos get seen early on. Also, the world has gotten more adept at embedding and sharing videos in real-time via Twitter and Facebook. (And there’s probably more video to choose from.)

What’s this mean for publishers? For one thing, publishers should have advertising/monetization schemes ready to go for their videos right when they’re published, because the hits come early.

It also means companies should be actively uploading videos to YouTube, says David Burch, a rep at TubeMogul. He notes that major companies like the NBA have been good at getting clips on YouTube quickly. If they didn’t act fast, then they could miss an opportunity to get eyeballs.

chart of the day, youtube video lifecycle, may 2010

Follow the Chart Of The Day on Twitter: www.twitter.com/chartoftheday

Join the conversation about this story »

See Also:

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Friday, May 28th, 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.

Augustine Fou portrait
http://twitter.com/acfou
Send Tips: tips@go-digital.net
Digital Strategy Consulting
Dr. Augustine Fou LinkedIn Bio
Digital Marketing Slideshares
The Grand Unified Theory of Marketing