Pennsylvania May Tax Advertising
Filed under: Online Advertising – January 05, 2006
The Pennsylvania House passed legislature December 21st that would expand the current 6 percent sales tax to cover business services, including advertising, assets management, and a number of other management and consulting services in a bid to reduce personal property taxes for homeowners. This Republican sponsored legislation seemingly will pit homeowners against businesses.
Every person wants lower taxes, particularly if they can be shifted away to businesses like advertising, PR, consultants and the like. Advertising is defined broadly to include publishing promotional information through any medium including newspaper, television, or radio, and possibly the internet. I’m sure that they don’t know about affiliate marketing or performance based marketing, or that might have been mentioned as well.
Who do they tax? The advertiser who operates in Pennsylvania and advertises through AdWords? Or do they tax the businesses who accept the advertising dollars, such as Direct Response Technologies? If this were California, I’m sure the answer would be both.
AdAge reports (registration required) that Pennsylvania generates $225 billion each year and 885,000 jobs from advertising. This number seems impossibly huge, but since the “advertising industry study” says so it must be true. This is not the amount spent on advertising, but in reality is likely the full trickle down number taking advertising, sales, salaries, and lots more into the equation.
Not that anyone likes taxes, but to have a sales tax on advertising as well as on the actual sale of the product or service being advertised is going overboard. With a 6 percent tax on advertising, budgets will be the same, but the amount of advertising will be smaller. This will impact the profitability of the media (newspapers are already struggling), and likely sales as well. If advertising drops by 6 percent, it reasons that sales would also drop. If sales drop, then the tax increase may turn into a net loss.
Not surprisingly, Lawyer services are not included in the tax.
Keyword Prices Plummet – Or Not
Filed under: Online Advertising – January 13, 2006
MediaPost reports that Keyword Prices Continue Downward Spiral citing results from a Fathom Online study that shows a 1%-2% drop from November to December, and a 16% drop from December 2004 compared to 2005. Meanwhile, ClickZ reports on a SEMPO survey that says that keyword prices are “up 20% or more.”
The Fathon Online survey is more scientific, actually tracking 500 generic keywords daily across eight categories for the top five ranked positions on various search engines. Because the survey also tracks categories, it shows that automotive and travel actually showed increases of 15% and 2%, respectively for the year. For the month, the categories that showed an increase were wireless (15%), consumer retail (13%), automotive (10%), and travel (2%). The biggest losers were mortgage (down 31%) and consumer services (down 35% from $1.36 in December 2004) for the year. Mortgage keywords peaked in April at $6.49!
The SEMPO numbers are based on their own survey and the responses to the questions.
The survey, the Search Engine Marketing Professional Organization’s (SEMPO) “The State of Search Engine Marketing 2005,” found that most advertisers felt prices for their common keywords rose in 2005, with the most common estimate of how much they rose being “20 percent or more.” That was the response of 32 percent of agencies and 20 percent of advertisers in the survey, followed by “10 percent more” and “30 percent more,” both garnering 25 percent of agency votes and 15 percent of advertisers’.
Differences here are because one method is based on hard numbers, and the other on feelings, but they also are not necessarily from the same categories. I’d pay more attention to the Fathom data if you fit into one of their categories.
Milliondollarhomepage Under Attack
Filed under: Online Advertising – January 18, 2006
In an interesting development, the milliondollarhomepage was under DDoS attack because Alex Tew refused to pay extortion to hackers, possibly linked to the Russian mafia. At first blush, it would seem that this is yet one more clever PR stunt to keep interest up for the site. But since this has been reported to authorities, if it was a stunt he could end up in big trouble with the law himself for a false report, so I am not longer so sure.
The timing is about right, because he just auctioned off the last 1000 pixels on eBay for $38,100 (a premuim of $37,100 more than the normal rate) last Friday, and now that the site is “complete”, there is really no more reason for anyone to write about it or otherwise generate publicity and traffic to the site.
According to the reports, he was first sent an email January 7th (while his auction was still ongoing) demanding $5,000 or else they would take his site down. A week later (after the auction closed), he was sent a second email, this time demanding $50,000:
“hello u website is under us atack to stop the ddos send us 50000$ … if u do not pay -u site NEVER came online … -u have BIG problem with u sponsors … u must answer TODAY.”
Mr. Tew has met with the British National Hi-Tech Crime Unit and the FBI (his servers reside in the USA). As of today (January 18th) his site appears to be back to normal.
The Price of Sex? $14,000,000
Filed under: Online Media – January 19, 2006
The famous Sex.com domain changed hands this week, this time with the owners permission, as it was sold for a record fourteen million dollars. The long embattled owner, Gary Kremen, has been shopping the domain for a year, saying that he wanted to get out of the Adult business.
The new owner is Boston-based Escom LLC, but it also appears as if sales will continue to be made thorugh Kremen’s compant, Grant Media. Kremen famously lost the sex.com domain to Stephen Cohen who obtained the domain name from Network Solutions in 1995 based on a forged letter. This case had some interesting case law, as a judge ruled that a domain name could not be stolen, as it was not property. In 2001, Kremen won the domain back as well as $65 million in damages from Cohen, which remains unpaid to this day.
Sex Got Cheaper
Filed under: Online Media – January 24, 2006
Reports of the sale of Sex.com for $14 million may have been suffering from premature exclamation. Perhaps we all should have been thinking about baseball statistics, because a source “familiar with the deal” is reporting that the deal is closer to $12 million and involved cash and stock, as well as requirements that the business meet certain performance targets.
A group of anonymous buyers, Boston-based Escom LLC, said in a statement it had acquired the Web address Sex.com from Gary Kremen, chief executive of Grant Media LLC and the founder of Match.com. Terms of the transaction were not disclosed.
Gambling Ads Cost Publisher $7.2 Million
Filed under: Affiliate Marketing – January 24, 2006
The Sporting News has agreed to a $7.2 million settlement with the U.S. government to resolve claims that it promoted illegal Internet and telephone gambling in print, on its Web site and on its radio stations. Ads reportedly ran from early 200 through December 2003, six months after the government sent the publisher a letter warning them that these ads were illegal. The Sporting News disagrees, stating that they stopped running the ads after they were “first notified of the government’s position that it is illegal to do so.”
In the settlement, The Sporting News paid a $4.2 million fine with the remaining $3 million being spent in the form of public service ads to tell people that gambling over the Internet or phone is illegal, while The Sporting News neither admitted nor denied its legal liability.
The reason I filed this under Affiliate Marketing is because the Casino Affiliate business is so huge. They are prosecuting larger publishers now, but who knows how long it will be before they start to target affiliates earning large sums from referrals.
Catherine L. Hanaway, the United States attorney for the Eastern District of Missouri, said prosecutors compare accepting gambling ads to advertising on behalf of drug dealers and child pornographers. If they are putting gambling ads on the same level as child porn, then you better be damn careful!
Hanaway said the settlement is among several out of her office since 2000 that have generated more than $40 million. Of note:
–In January 2000, Paradise Casino agreed to forfeit $14 million. In 2003, PayPal Inc., an online payment network, forfeited $10 million to settle allegations it aided in illegal online gambling.
–In 2004, the Discovery Channel forfeited $6 million for accepting money for ads for Internet gambling companies PartyPoker.com and ParadisePoker.com. Also in 2004, St. Louis sports radio stations KFNS-AM, KFNS-FM and KFRT-AM paid $158,000 to settle allegations that they promoted illegal online gambling.
They target the easy prey here in the US because the gaming companies themselves are difficult to prosecute because they’re located in places like the Dominican Republic, Malaysia, South Africa, Cypress, and Costa Rica.
Hanaway wouldn’t say if other sports magazines, radio programs or networks, or Web sites were also under investigation. Time will tell, but I predict we will see the first casino affiliate prosecuted this year.
Is My Blog Really Worthless?
Filed under: Online Publishing – January 25, 2006
I use various methods to keep tabs on what people are saying about my companies and my self, and one of them just found a new “list” that says that my blog is not worth a thing. Luckily, ReveNews comes out better as a whole as others here are wortha decent amount of money.
I have an account with Google Alert that includes a search for all our trademarks, service names, and my own name. Today’s email included the follwing result:
Search 1: “brad waller” – tracking top 20 of about 384 results
Blog Network List :: The Comprehensive Blog Network Rankings
Blog Details – Brad Waller. Blog Name:, Brad Waller [Visit Blog]. Blog Network:,
Revenews. Overall Blog Index:, 1173. Overall Blog Rank:, 1446 …
http://www.blognetworklist.com/sitedetail.php?siteid=1516 – Rank 8 – cached
The Blog Network List is a new list that monitors and ranks 68 networks consisting of 1456 blogs. I guess it could be worse. My rank is 1446, so they think that there are ten others below me…
ReveNews ranks towards the bottom as well, at #56, and they have assigned an aggregate “value” of just under $100K for the ReveNews network. Appropriately, Jim Kukral, Wayne Porter, and Jeff Molander are the top three ReveNews bloggers, each having values over $10K.
You can actually view blogs 12 ways using different ranking criteria, ranging from assessed value to Yahoo! inlinks. Networks can be ranked 23 ways, with most of the additions being averages of the other numbers over all blogs in the network. Since value is the most sexy, I’ll gove you their FAQ for this one:
Where does this value number come from anyways?
The current blog “value” amount is based on work done earlier by the Business Opportunities Weblog and Tristian Louis. The numbers are based on a valuation of the Weblogs, Inc. acquisition by AOL. We don’t put much weight in it, but it’s fun to play with.
Access Blocked: The Nightmare Starts in 2008
Filed under: Internet Strategy – January 31, 2006
Censorship, unfair trade, or just business? As of January 6, 2008 Verizon will no longer be held by the restriction to comply with the “network neutrality” principle that has been a hallmark of the Internet since its inception.
The requirement and the expiration come from the Verizon/MCI merger that was recently completed. Acually, the date could come sooner for some, as the FCC mandated timeline for SBC/AT&T; customers is a few weeks earlier. Without network neutrality, your ISP could block or reduce access speed to any content or service they see fit. Maybe they are against pornography, so they block all of that. No problem you think as you are not into online pornography. But what if they are fundamentalist right wing conservatives? Maybe they will block the “liberal” media and any site that mentions evolution.
What does this really mean for us? If they don’t do anything, it is no big deal. But if they excercise their right to restrict access or limit speed, then it could wipe out millions of customers from your business. Do you use a VOIP service? Maybe the ISP will block it because they want you to pay them for their version. Do you download movies from a legal online service? Maybe they will pinch the pipe to limit you to the equivalent of a 14.4K modem because they want to sell you their Video On Demand. Do you use iTunes? Not if your ISP wants you to buy from their online music store.
But what if they want to tap into the multi-billion dollar online shopping revenue stream of their users. Maybe they would block access to all merchants unless you buy through their online portal, which gets all the affiliate income. Now how do you feel as your program grows, but you now only have a few affiliates and overall sales drop because the smart affiliates went away. These firms will have a huge base of customers. Maybe they will want a license fee from the affiliate network to allow affiliates to refeer buyers, or else they just block all access. Same thing for advertising networks.
If you think this is extreme, consider this quote from SBC Chairman Edward Whitacre:
“For a Google or a Yahoo or a Vonage or anybody to expect to use these pipes for free is nuts!”
Considering that over 60% of households get high speed service from just four service providers (Comcast, Time Warner, Verizon, and AT&T;), and that consolidation is continuing, this is a real and growing threat.
New Model: Charge for Hidden Advertising
Filed under: Online Advertising – February 01, 2006
I have just been notified of a brand new idea in the long line of copycat million pixel pages. This latest entry turns advertising on it’s head and makes the ads invisible until the user mouses over the pixels containing the ad.Hiddenmillioneuro asks the question, “Can I make a million Euro by selling hidden ads?” I was wrong about the original milliondollarhomepage, but I don’t think I’m wrong this time when I answer, “No!”
At least you can have fun with the page if you like pixel art:
I’ll admit that his idea is clever and different, which is what it takes to get talked about (I’m doing it, aren’t I?), but the premise behind the site is that it is a black page until you mouse over the ads or even site navigation. This is a bit loopy to me, as I would at least think that you would want to have your site navigation and maybe explanatory text visible for all to see when they arrive at the site. Also, while ads are persistent after you mouse over them, the text and navigation links are not. At least the owner, Koen Kastermans from The Netherlands, admits that he created this after seeing the milliondollarhomepage.
Then again, maybe Koen is just a copycat Rootkit Artist.
If you want to pay 100 Euro to get your ad not shown, rush on down and get your ad in place before the invisible rush starts!
Auto-surf Ponzi Scheme and a “Storm” of Controversy
Filed under: Online Advertising – February 28, 2006
In yet another blow to the all too reputable area of “get paid to surf” sites, the SEC just shut down 12DailyPro.com for bilking $50 Million from about 300,000 users in less than a year. Since the scheme used online payment processor StormPay, they too have been brought into the ugly mess.
They promised members 44 percent returns for surfing a dozen Web sites for a total of five minutes per day for 12 days. Despite claiming to raise money from “multiple streams” including advertising and off-site investments, at least 95 percent of the money 12dailypro’s returns came from member fees — “almost a pure Ponzi scheme,” the SEC complaint said.
The scheme required users to buy $6 “units”, up to a maximum of 1,000 units, and to view advertisements from what were described as paying advertisers. Charis Johnson and her companies, 12daily Pro and LifeClicks LLC, agreed to settle the charges without admitting or denying guilt. They agreed to stop seeking further investors, to freeze assets and to accept a court appointed receiver over corporate assets.
This is where it gets interesting. To recover the money, they need to find that $50 million, and according to the SEC Ms. Johnson only has $1.9 million. According to Johnson’s attorney, Noell Tin, credit card payment processor StormPay.com “is holding about $50 million of 12dailypro.com’s money” and Johnson has already returned $1.4 million to 12DailyPro.com members.
There is no word from StormPay about this, but this will surely hurt them. Between the financial hit of not getting the fees they would expect on this money and the reputation problems from being associated with this, it’s no wonder they aren’t talking.
According to a February 7 Better Business Bureau of Middle Tennessee statementStormPay.com “generated more complaints to the BBB than any other Middle Tennessee or Southern Kentucky business” during the first six weeks of 2006. The statement adds that the “BBB has received 18,926 inquiries from consumers around the world checking on the reliability of StormPay.com” over the previous week.
StormPay has a statement of their own, acknowledging that they have money in accounts for victims of the scheme, but that they “can confirm that there will not be enough money available to get everybody reimbursed but we are formulating an orderly plan to reimburse victims to the limited extent that may be possible.”
While Johnson’s attorney says that StormPay is holding $50 million, it only makes sense that the early “investors” withdrew the “earnings” paid for by later “investors”, and any money in the system really belongs to the ones who paid 12DailyPro. There are victims with frozen accounts that may include their “earnings”, in which case some of the money they think is already theirs should go back towards restitution. StormPay says that they are “currently undergoing an audit, near completion, and done with our absolute and complete cooperation, which will show that every penny of money we have ever had control of can and has been accounted for.”
Gambling Company’s Slimy Olympic Advertising Deserves Censure
Filed under: Media – February 28, 2006
GoldenPalace is doing it’s best to ruin the non-commercialization of the Olympics and have turned themselves from the eccentric “buy anything odd and famous on eBay” for publicity company to the desparate “I’ll whore myself for a buck” gambling house that is lowering itself down to what people expect from such places. The tatooed streaker at the curling match was annoying, but easily edited out and therefore not such a big deal. Then there were reports that they had someone repeatedly unfurled a banner for them at the men’s speedkating event. Also annoying, but it never made the broadcast.
The final straw for me was the deranged attempt to interrupt a speech given by Torino Organizing Committee president Valentino Castellani. It was quick, but for some reason the network showed the man with his offensive advertisement of a shirt get grabbed and hauled away. I hope they keep him locked up for a while and set the bail high. And NBC should send GoldenPalace a bill for advertising serviced rendered. And I hope people vote with their pocketbooks and stop advterising, marketing, and patronizing (of course in the US this is illegal anyhow) them.
Online Ad Revenues Up – Over $12B in ’05
Filed under: Online Advertising – March 02, 2006
The IAB report on Q405 and FY05 Internet Ad Revenues estimates 4th quarter numbers of $3.6 Billion, setting a new record. This brings the total to $12.5 Billion for the full year – 30% higher than the previous record of $9.6 Billion in 2004. These estimates were created through a survey of the top 15 online ad sellers. Actual 3rd and 4th quarter numbers will be released in April.
ABC to Offer Free (Ad Supported) Show Downloads
Filed under: Media – March 02, 2006
According to AdAge, ABC plans to offer both free and paid versions of its shows for download. Shows will continue to be offered through the iTunes store for $1.99, while versions with ads (not necessarily the same ones seen in the national broadcasts) will be offered for free through a new and yet to be released service called My ABC.
I like where this is headed. I was just thinking about this last night because there has been talk of forcing cable companies to offer channels A La Carte instead of in huge packages. This is supposed to offer consumers more choice in what they watch and not make them pay for channels that they will never watch. In reality, I expect the per channel prices to be high enough that you will only get a fraction of the channels you get now for the same price. This might be OK for singles, but families may have to satisfy three or more demographics and thus pay a lot more than they are now.
The extension of this is that I wondered how much it might cost if instead of paying them per channel you paid by the show. At $1 a show and two shows a day you end up with a $60 monthly bill. Go on vacation and don’t watch TV for two weeks and you don’t pay for what you didn’t watch. Summer re-runs might get you to move outside your normal shows and choose to pay for something on an alternate network. You could have a pure Video on Demand system instead of VOD being an extra.
This ABC model is similar, but it bypasses the cable company. You can download this to your computer and burn a DVD, then watch it on your TV. With a media center computer attached to your TV you can skip the burning and watch easily enough. The only issue is file quality. If these free downloads from ABC are the same low quality of the iTunes shows made for tiny screens, then I really don’t care. What would make this great and shift users to this new model would be full resolution (and an HD option for the shows that are in HD) files for download.
Crackberry Addicts Rejoice – RIM Pays $612M to NTP
Filed under: Internet Strategy – March 03, 2006
CNN Reports that Blackberry maker Research in Motion agreed to pay $612.5 million to patent holding company NTP to settle a long-running dispute that had threatened to shut down the popular wireless e-mail service.
This came just ahead of a judge’s ruling on the case. This has been closely watched as RIM has been chipping away at the patents, but the judge did not want to wait for the agonizingly slow USPTO to complete their investigations and wanted to bring this to a quick conclusion.
Interestingly enough, just about all the articles I saw on this were predicting victory for RIM as five of the NTP patents were in some process of rejection.
Net Neutrality Has an Advocate in the Senate
Filed under: Online Publishing – March 03, 2006
Senator Ron Wyden (D-Oregon) announced the Internet Nondiscrimination Act of 2006 on Thursday that would protect net neutrality and prohibit network operators from charging companies for faster delivery of their content to consumers over the internet or favoring certain content over others. This is indeed great news as this addresses the issues I brought up in my previous article on this subject.
Specifically, the Wyden bill would ensure the network operators treat internet content equally by:
• Not interfering with, blocking, degrading, altering, modifying or changing traffic on the Internet;
• Not being allowed to create a priority lane where content providers can buy quicker access to customers, while those who do not pay the fee are left in the slow lane;
• Allowing consumers to choose which devices they use to connect to the Internet while they are on the net;
• Ensuring that consumers have non-discriminatory access and service; and
• Having a transparent system in which consumers, Internet content, and applications companies have access to the rates, terms, and conditions for Internet service.
Wyden said this about the bill:
“Creating a two-tiered system could have a chilling effect on small mom and pop businesses that can’t afford the priority lane, leaving these smaller businesses no hope of competing against the Wal-Marts of the world. Neutrality in technology enables small businesses to thrive on the Internet, and allows folks to start small and dream big, and that’s what I want to protect with this legislation.”
Cool Tool Found at ad:tech 1MPACT LA
Filed under: Online Advertising – March 09, 2006
I found a really cool new tool at the ad:tech 1MPACT show in Los Angeles this week. The tool is for large scale advertisers and it looks like one of the best implementations to merge planning, executing, and analyzing your advertising all in Excel. The fact that they did this in Excel is what really impressed me the most. I love Excel and use it for everything I can, and they really pushed the envelope and used all the tools available to turn this into an amazing piece of interactivity.
The tool is called TruAdvertiser.xls and is from TruEffect out of Colorado. They bill this as being able to turn Excel into and ad server, which is close to what it can be. Excel will not actually be serving the ads, but they set it up so that you can control the ad server, obviating the need to ever log into it. What they did was eliminate all the waste and time lost in taking data from Excel and implementing the advertising, then putting it back into Excel to check out how it is doing. Since most planning is done in Excel, they created this application to use that and put everything in one place.
Media planners can set up their goals and plans, load creatives into the Excel application, set up actual campaigns and have them sent to the ad server, and then results from the server will be fed back into their application. This a great merger of all the capabilities that Excel has along with XML and Internet communications. It truly does turn Excel into an ad serving interface. Now advertisers can start and end in Excel, and never leave Excel. This gives them more control and saves time and money. What a great idea.
As for the 1MPACT show, not only does it come to you (or close), but it has great info packed into a one day show that only costs $395. You don’t get the huge exhibit hall, and networking time is a bit limited, but I think that they have a winner of a show here. It is in Dallas today, and then continues in six more cities over the next three weeks to complete it’s ten city tour. You can read more at the official ad:tech blog.
Direct Revenue Settles Adware Class Action Suit
Filed under: Adware, Spyware & Greynets – March 16, 2006
In what looks like a huge victory for Direct Revenue, they settled a class action lawsuit based on allegations that they installed ad-serving software on computers without the owner’s consent with no cash penalty. The proposed settlement (it still has to be approved by the judge) will have Direct Revenue stop distributing adware on sites targeting children under 18, and from using the word “free” in banner ads, unless they disclose that the service will be ad supported. They also agreed to use the word “advertisement” instead of “offers” to describe their promotions.
Direct revenue will also now ensure that people actually agree before any software is installed! Sure, this is a step forward, but it seems like a slap on the wrist. Geez, now they can’t install something without your permission or mislead consumers. But what is the penalty for doing this until now? They have to destroy personally identifiable information which they claim not to have collected anyhow! And they also offered to set up a toll free number with a recording that explains how to remove their adware.
US House Takes Aim at Internet Gambling
Filed under: Affiliate Marketing – March 16, 2006
A bill aimed at cutting off the online gambling industry at it’s knees passed a critical House committee Wednesday and is now on it’s way to the House Floor for consideration. The bill would prohibit a gambling business from accepting credit cards, checks, wire transfers, and electronic funds transfers in illegal gambling transactions.
The US House Financial Services Committee approved H.R. 4411, The Unlawful Internet Gambling Enforcement Act of 2006 would prevent the use of credit cards and fund transfers for unlawful Internet gambling and would allow the blockage of financial transactions associated with illegal gambling. Gambling covered by this legislation includes placing bets on online poker sites, for example, and any other online wager made or received in a place where such a bet is illegal under federal or state law. This fully targets offshore gambling Web sites used by millions of Americans. Excepted by this bill are fantasy sports and horse racing.
The bill was introduced by Representative Jim Leach (IA), who might be more worried about the loss of tax collections than the morality of gambling. He also intruduced some FUD by throwing in cards for trust issues, youth, and even terrorism. Leach said, “
Unlike brick-and-mortar casinos in the United States that provide jobs and tax revenues, Internet gambling sites yield no benefits to Americans. These sites evade U.S. gambling regulations that control gambling by minors and problem gamblers, and ensure the integrity of the games. Young people are particularly at risk. What’s more, FBI and Justice Department experts have warned that Internet gambling sites are often fronts for money laundering, drug trafficking and even terrorist financing.
I was pretty amazed to see a Democrat, Massachusetts Rep. Barney Frank, oppose the bill. He said Congress should not seek to control how adults spend their money just because some lawmakers oppose gambling.
“Adults are entitled to do with their money what they want to do,” he said.
Net Neutrality Debate Continues
Filed under: Internet Strategy – March 17, 2006
After I first wrote about the threat of losing net neutrality in January and then wrote about it’s ally in the Senate, activity dies down. It’s back with a great article on ClickZ and another in Business Week.
Rebecca Lieb wrote a great in-depth piece at ClickZ that talks about the pertinent issues and she says a lot of what I have been thinking. The Business Week article is a counterpoint from Tom Tauke, executive VP of public affairs, policy, and communications for Verizon. In my first post I gave a Quote from AT&T; and chairman Ed Whitacre which Rebecca also uses. But she found another great one from BellSouth spokesman Jeff Battcher. He told “The Wall Street Journal,” “During the hurricanes, Google didn’t pay to have the DSL restored. We’re paying all that money.”
What!?! Talk about nuts. Why should Google pay to replace the wires you laid (and likely got government assistance or grants or tax relief to help you out) that got damaged by a Hurricane? What kind of business model do they have where they don’t expect the actual business operations and income to pay for their expenditure? I once had the pleasure of listening to Dana Blankenhorn give a talk where he demonstrated that the Bells could not compete against new wireless technology because they had so much invested in infrastructure. They want us to pay for this expensive (~$1 trillion) infrastructure, and they also want the Googles and Skypes and high bandwidth sources to pay for it too.
Sorry, you can’t have it both ways. If you want them to pay for access, then why not let us have service for free?
Most of the arguments made by Tauke are that the problem does not exist, and Verizon has no plans to interfere, so why regulate? But is this really regulation?
Tauke opens his piece this way:
Congress should say no to those encouraging it to impose regulation on the Internet and a new set of requirements on America’s broadband networks. This effort — cloaked in the phrase “Net neutrality” — is an attempt to fix a hypothetical problem that does not exist. These new Internet regulations are not only unnecessary, they pose a danger to the future of high-speed wireline broadband deployment in the U.S. at the very moment such investment is taking root.
Look at the words he chooses. Regulation, requirements, cloaked, danger. He is trying to spread fear. “Net Neutrality” is a cloak for regulation? High speed access is in danger because of this? His own industry has already shown us that they want to limit access and have sites pay for use. This is not hypothetical when the CEOs tell us that it would be nuts to let us have access to Google for free.
You can’t compare this to airline or telecom regulation where they specify everything. This is regulating that you can’t change the open system. This is more of a rule than an entire industry regulation, so I don’t buy his argument that regulation will stifle the industry.
Lets look at his arguments:
First, the Net neutrality principles endorsed by Federal Communications Commission Chairman Kevin Martin and his fellow commissioners are working in the marketplace right now.
Yes, but the marketplace now is held by agreements that they will keep open access. These agreements expire in less than two years.
Second, if an industry player does not live up to the Internet neutrality principles, that company is sure to be quickly held accountable.
So, if a major player covering 30% of the market decides to limit access, we should trust the government to help us. And what if the top players all decide to do this, just before the Christmas shopping season?
Third, the push for Net neutrality legislation is a classic example of anticipatory regulation — the kind of legislative and regulatory overreach that can freeze a dynamic marketplace and slow innovation and investment. No one — not Congress, not the FCC, not those of us in the broadband industry — can predict the future. Consumers, technology, and the marketplace will decide what works and what doesn’t. If there are bad actors in the future, they will be dealt with appropriately.
Just because AT&T; CEO Whitacre gives every indication that he will limit access unless he is paid off, we should wait until he actually does this? Then what? Do we wait for congress to take a year to write, debate, and enact legislation? How many small businesses will go away while we all wait for these “bad actors” to be “dealt with” by our government who we all know has our best interests at heart and will never back big business?
Don’t get me wrong, I am not anti-government, and I don’t like more rules and regulations. But in this case it really does make sense to ensure net neutrality.
Claria to Abandon AdWare Model
Filed under: Adware, Spyware & Greynets – March 21, 2006
Claria announced via a press release earlier today that they would be leaving the AdWare business by the end of the second Quarter of 2006. They are doing this to focus on “a next generation platform designed to provide consumers with a highly personalized
Internet experience.” They plan to announce “major partnerships” and launch a beta version of their new “PersonalWeb” application in April (the 1st maybe?).
This is not the end of their AdWare, however. The company is leaving the model behind, but they are not letting their millions of installed applications go away for nothing or shutting down the oft criticized service. Claria retained Deutsche Bank Securities, Inc. to sell off the AdWare business and they say they have a number of interested buyers. Claria says that they will require any buyer to agree to “adhere to emerging industry standards outlined by
TRUSTe and other industry coalitions” but how they will enforce this remains to be seen.
Sptizer Gooses Gratis
Filed under: Online Marketing – March 24, 2006
New York AG and Internet Pitt Bull Eliot Spitzer filed suit Thursday against Gratis Internet, owner of sites such as FreeiPods.com, accusing them of selling millions of email addresses contrary to their stated Privacy Policy. This seems to be “Part 2” of the investigation that resulted in a !$1.1 Million fine against Datran Media Corpearlier this month/..
Gratis does business through a number of web sites, such as FreeCDs.com, FreeiPods.com, FreeVideoGames.com, and FreeDVDs.com. Gratis also had a great write up in AdAge where they talked about the company, and how it was founded on the model of giving away free condoms (in exchange for PayPal signups). In its privacy pledge, Gratis, which also does business as iPods.FreePay.com, promises to “never give out, sell, or lend” consumers’ names, email addresses, or other personal information to anyone. But Spitzer claims that they have sold access to lists of between 1 and 7 million addresses to three email marketers.
It appears as the investigation against Gratis was done by checking out their partners, and once they had information from Datran they have what they need to accuse Gratis of wrongdoing. I expect to see some finger pointing between the companies accusing the other of misleading them. When one company says that they will not hare, sell, give, or lend customer information “for any reason”, and the other has a business model based on mining customer data and demographics on behalf of clients and bringing select retail opportunities to users, you can see opportunities for a lot of “he said”/”she said” arguments.
OMMA Hollywood – Reporting from the Conference
Filed under: Online Marketing – March 27, 2006
I’m here at the OMMA Hollywood Conference. I’ll try to post as much as possible over the next two days and give you my observations and insights on the show. My first impression was that it was a pretty big show, but talking to many attendees I heard that they thought it was smaller than they expected.
The theme is Internet 2006: The 100% Solution?. They are raising the question if the Internet can be the total solution for driving all marketing efforts.
This was originally posted from the show, but I guess the slow connection we had there messed it up and overwrote it with my second post.
OMMA Hollywood – Measurement Online
Filed under: Online Marketing – March 27, 2006
David Smith, CEO of MediaSmith opened by apologizing for making the quote that the Internet is “the most measurable of all media” for the session entitled “Measurement Online: Facts, Fiction, and Future Work.” On the panel were John Chandler, and analyst with Atlas and Erin Hunter, SVP of comScore Networks.
Erin said that comScore’s mission if to “measure all media.” She talked about ad spend online and how well the industry is measuring those areas. Banners still ranked at the top with 69% using that means, but PPC search was close behind with 66% penetration. Up and coming areas were Classifieds (36%), rich media (18%), and mobile (5%). Rich media is seeing the largest growth, with a 29% compounded annual growth rate (CAGR). Classifieds were next with a 15% CAGR, and then came banners at 9%. Either they could not measure, or there was not enough time to calculate the numbers, but there were no growth rates listed for the other two areas.
She feels that the industry is doing a great job with sponsored search, giving grades of B+ for planning and B for post analytics. Banners and rich media were lumped together, and she said that presently there are problems with the planning tools, but she sees this area improving from a C to a B+ this year. Not surprisingly, she gave those media an A for post analytics.
She also highlighted a recent report showing a positive ROI for online local, directory and classifieds advertising. The research shows positive results on both sales and brand impact for companies that advertise in these areas. Interesting reading.
John spent most of his time talking about engagement and brand exposure through online video. He uses “Brand Exposure Duration” to replace the old standard “Frequency” when he is analyzing engagement in the online video area. He also highlighted a new term coined by the ARF, that now has being “Turned On” as a metric. Insert your own joke here…
John showed his way of integrating length, the number of views, and the percentage of segment viewed as a function for exposure. Since it is not a banner that is seen or not seen, this gives a better sliding scale to determine the level of exposure. He had a chart showing the time of the clip vs. the percent viewed, but I could not see the correlation he claimed. The one interesting point is that a very long video can actually have a high engagement because it does not take as much when you have some people watching the video for 30 minutes when compared to a 30 second spot and it’s resulting final exposure value.
OMMA Hollywood Panel: The Content
Filed under: Online Media – March 28, 2006
The first panel of the show addressed the statement: The Internet will become the primary distribution channel for all media content. Panelists were from Fox Sports, Yahoo, AOL, MSNBC, and ABC. There was reasonable agreement that while the internet may not be the channel for all content, it will become the primary distribution channel. Yahoo gave the example of the new partnership with 60 minutes.
they spoke about TV moving online, and that TV was the first ad supported distribution medium. I can’t say for sure if this was true, because I have no idea if there were trade publications or other paper media that were ad supported before TV was on the scene. The panel also agreed that it would be a very long time before the Internet replaced TV. Brian Grey from Fox Sports commented that they had 325,000 simultaneous feeds for the NCAA playoffs. While impressive, one of the panelists commented, “That kind of numbers would get a show cancelled on Noggin.”
OMMA Hollywood – Do AJAX and Web 2.0 put Web Measurement back to Square 1.0?
Filed under: Internet Strategy – March 29, 2006
Eric Picard of MSN talked about how we got to where we are with IAB standards in measurement of ad impressions, and where that might be heading now that new tools are out that blur the line between a page view and reload. Before the standard, there were 27 different ad servers with 13 different definitions of an impression! Now, technologies such as AJAX mess this all up. With the old standard, it took years to agree on one single definition of what an ad impression is, but at least it is a simple definition based on actions that can be understood by all parties. The current definition is pretty much that an impression is counted when an ad server has completely finished serving an ad to a client page. But when a page is never reloaded and a user interacts with it for 20 minutes straight, you should be able to serve more than one ad during that time frame.
So, if not reloading the page, how many impressions can you serve? As an industry, there is a need for an agreement on how, when, and if you reload the ads on a page that has user interaction but does not reload. MSN is addressing this now as the next generation of Hotmail will be more like Outlook Express, and there will not be new pages loaded as you use the site. So now how do they count pageviews and when so they refresh the ads? They came up with a time/activity formula that determines when they will refresh the ads on the page. Without a standard, they need to move ahead with something that is reasonable. Of course, disclosure to advertisers is also required so that they understand and agree to the way their ads are served.
Eric sees the new standard as a combination of user engagement with an appropriate amount of time to have the ad shown on a page. If nothing else, there needs to be a minimum standard for how long an ad must be on a page.
While he does not think this will be a quick process to come up with a new standard, Eric thinks that once this definition is solved that it will stand for a long time. Because the definition will have to be flexible, it will cover future developments.
Online Ad Revenues Top $12.5B for 2005 – Updated
Filed under: Online Advertising – April 20, 2006
I already reported on this when the estimates came out, and the final release does not have any real surprises. CPM ads still dominated with 46% of the market, compared to 42% in 2004. Overall growth of CPM advertising spend was also the largest, at 43% compared to the year before. Performance based ads still saw healthy growth, but interestingly Hybrid deals saw no growth at all.
The report also confirmend that the top sites still garner the lion’s share of all ad dollars. The percentage of ad spend earned by top sites was virtually unchanged, with 95% of all money going to the Top 50. One of these days ad buyers will realize that there is qa huge untapped reserve of inventory that will willingly take their advertising at a lower price and have much the same audience as the larger sites.
Keyword advertising led the pack when you look at the increase in ad spend as well as total dollars spent, with Sponsorships and Slotting fees being the only two areas to see losses in total spend. If you look at the increase in spending by category, Display Advertising actually had a larger growth by a few percentage points than Keywords! The top two areas by percentage increase were Email (161%) and Referalls/Lead Generation (290%), although total dollars spent for those two combined was still 20% of the $5.1B spent on Keywords.
More Inappropriate Ads on News Page
Filed under: Contextual Advertising – April 20, 2006
I was reading a “Strange News” article on MyWay whice truly should have been in a different area, but then I noticed the Google sponsored links along with it and saw yet another instance of the dangers of contextual advertising on news sites. The article was about a man who removed a (removeable) showerhead, turned on the water and jammed the nozzle into his girlfriends mouth until water came out of her nostrils, before breaking her hand. What ads could go with this?
What else but ads for even better showerheads!
I’m sure the victim would be happy to know that there are showerheads with even more pressure so that she can suffer from abuse that is not as boring or lousy.
Local Web Spending Jumps 78%
Filed under: Online Advertising – April 21, 2006
Local online ad spending partied like it was 1999, growing to $4.8 billion last year according to a report by Borrell Associates released this month. This is 78% larger than the $2.7 billion spent on local ads in 2004 – and substantially larger than Borrell’s report from last year which estimated growth of only 46%. They missed the mark by almost a billion dollars! This kind of growth has not been seen since the heady days before the bust.
The report analyzes data from Web revenues for 2,266 local media properties, comprised by newspaper, radio station, TV station, and independent local sites. Newspapers accounted for almost half ($2 billion) of the $4.8 billion spent last year on local advertising. What I find amazing is that ten years ago I could not convince these types of sites that the Internet was something worthwhile. We had meetings with newspapers who were afraid of diluting their content and audience and wanted to protect their print empire.
Radio and TV also dismissed the Internet until recently, and they are seeing large revenue increases from this local ad spending as well. With broadband penetration where it is, the time is right for the rich experiences of video and audio content that these sites can provide. Advertising earnings should also grow at a rapid pace as this content grows, and as the latest innovations in video advertising are realized.
I also look forward to growth in ads on local portals (check out all the city name dot com sites), municipal WiFi, and locality based search to become significant in the near term.
Contextual Ads and News Just Don’t Mix
Filed under: Contextual Advertising – April 25, 2006
I know I just wrote about this, but again there is another horrible contextual issue with a news article. While reading news on Excite, I see an article about a man who killed and grilled his mother. What ads appear? Try reloading a few times and see if you get the ads to “Sponsor an orphan” or for “Crime Scene Cleanup” or “Cops Make You Nervous?”
Surrounding an article about the recent terrorist bombin in Egypt, there are ads for “Country Caterers BBQ Inc.” (I wonder if this also shows up for the previous article!), and “$635 round trip Amman” and “Jordan Visa Specialists” were juxtaposed with an article on a plot about a terrorist attack in Jordan.
These are all Google ads, but I’m sure this can be found with the others. If you plan to use a contextual campaign, seriously think about excluding news sites. Please.
Can you tell I read a lot of news?
Save The Internet – Net Neutrality Battle Goes Grassroots
Filed under: Internet Strategy – April 25, 2006
An amazingly broad range of individuals and groups have taken up the cause of Net Neutrality through a coalition called SavetheInternet.com. With Lawrence Lessig and Craig Newmark, and with conservative organizations such as the Gun Owners of America and ultra liberal MoveOn.org all agreeing and coming together over an issue, we have quite the mix.
But they are not just there to have a united voice. They are organizing and informing. You can fill out a form and send a message to congress, and you can see how our elected officials have voted on this with a great interactive map. If you want to continue to see unfettered access to all sites and don’t want to pay extra to access the most popular content, now is the time to contact your elected representatives and let them know that you want Net Neutrality to continue.
Sheepvertising?
Filed under: Online Advertising – April 25, 2006
I’m not sure how far this will go, but a company in the Netherlands has come up with a way to sell advertising on Sheep. Of course, this follows Ass-vertising and any number of off the wall GoldenPalace.com auction winners and stunts.
Farmers are being paid 15 euros to 20 euros per sheep which is not too bad considering “Their value as lamb-kebabs is around 60 euros ($75),” according to Hotels.nl Chief Executive Miechel Nagel.
Affiliate Marketing Grows Up at Ad:Tech
Filed under: Affiliate Marketing – May 02, 2006
I’ve already written a lot about Ad:Tech, but I’d like to make special mention of how the affiliate industry has become a real player. Not only has it been included as a panel topic, but it also had mentions in many talks and there were quite a number of booths dedicated to the industry.
Jeremy Palmer asks if Ad:Tech has become too big, and I have to say not even close. I wish I had run into Jeremy at the show, but that is the downside of a large show. But the upside? Have any of you been to the really large conferences like CES (150K attendees and 2,500 vendors), NAB (100K attendees) or SEMA (100K attendees and 2,000 manufacturers)? What happens is that you get the majority of the people there for the show floor, with sessions either going away or being viewed by a minority. Jeremy wanted to network, so imagine the possibilities when you have a huge crowd. SEMA breaks exhibitors up into 11 categories, and there is no reason Ad:Tech could not do the same thing as the show floor grows. Also, Ad:Tech had networking built in, with a web site that attendees could use to communicate and set up meetings. I look forward to a bigger and better show next time.
As for my networking, I had meetings with senior people at NetTraction and AffiliatePrograms.com, the CEO of BurstMedia, as well as many other Director and Business Development managers. It is still too early to tell, but I think the show will be a strong success from my own networking.
I’d also like to make special mention here about a vendor I had never heard of before: Zanox. No, they are not an ED drug, they are the largest European provider of performance-based multichannel commerce. I don’t have their data in front of me, but they may even be bigger than that, as they may be the world leader (or will be soon if their drive and energy has anything to do with it). I talked with them right at the end of the show, and my first impression is a lot like what I got from Commission Junction (and Todd Crawford) back when I first met them six years ago.
They do affiliate marketing and search engine management, as well as recommendation marketing, multichannel sales and customer loyalty. The do business in 25 countries (they entered China in March) and 4 continents and have companies from a wide range of industries including Procter & Gamble, Jamba!, Vodafone, o2, Lycos, Expedia, Allianz, Citibank, Axa, Sixt, DaimlerChrysler, Quelle and Staples. They even have Amazon as a client. I hope to get more information out for you here soon. Look for them at AffiliateSummit in July.
Net Neutrality Takes a Hit – But Don’t Count it Out Yet
Filed under: Internet Strategy – May 02, 2006
The battle for Net Neutrality (also called Net Freedom and the First Amendment for the Internet) had a loss recently when the House Energy and Commerce Committee approved a telecom bill last Wednesday on a 42-12 vote. Largely authored by Chairman Joe Barton, R-Texas, the legislation would allow ISPs to begin charging fees for sending traffic in addition to the fees charged to access the Internet. Such a pricing scheme would effectively create a second tier for content and application providers willing to pay a premium, allowing ISPs to prioritize traffic as they choose. eWeek has a great article on this bill.
But there is good news. The bill is not sailing through the House. The House Judiciary Committee has delayed the bill, requesting jurisdiction particularly because of its network neutrality language. While this is going on, competing legislation is being introduced with bipartisan support that supports neutrality, or at least moves it into the auspices of the FCC. Similarly, members of the Judiciary Committee are developing legislation that would impose antitrust penalties on broadband-access providers that attempt to demand fees from Web-content providers in exchange for priority treatment of their services. And just today, Rep. Ed Markey introduced his own Network Neutrality Act of 2006 that would insure fair treatment of all content. It includes provisions that if the provider prioritizes content for one type, it must do so for all data of that type and cannot not charge a fee for such prioritization.
This debate is not just in the Internet community any more. Articles have shown up in the Hollywood Reporter of all places as well as in Jeff Chester’s Digital Destiny blog (he normally covers broadband communications). Just check our the hundreds of news stories on this subject and you can see that the message is slowly getting out to the mainstream.
Blogger Sued for Criticism
Filed under: Online Publishing – May 03, 2006
AdAge reports that blogger Lance Dutson has been sued for copyright infringement, defamation and trade libel and injurious falsehood by an an ad agency under contract with the Maine Office of Tourism. As someone who has received a “lawyer letter” for something I blogged about, I have been following this for a while.
Lance started out critical of the tourist board first back in February, and then expanded his criticism to the agency as he saw more. It all started with complaints about PPC ads in Google, he also found an ad with the wrong phone number (it went to a phone sex line), and then he immersed himself in everything they were doing. He found budgets, spends, who was doing what, etc. It got to the point where his clients and even his wife and wife’s employer were being contacted over this in an effort to stop him.
While I don’t completely agree with everything he has been saying (particularly his complaints about city name PPC results in Google), I see no defamation, copyright infringement, etc. in what he has been posting. He tells all and seems to have pretty good records of all the conversations and emails. I love Lance’s attitude and the best stuff is where he responds directly to letters he gets from the other parties. He has not backed down, and already has some attorneys signed up to represent him.
I’ll leave you with an excerpt from his Blog so you can read in his own words how he feels:
o here I am, one man against the state and its contractors, put in the position of shutting up or being pounded by their deep pockets and a wild misconception of what the court system is supposed to be used for. One person who has exposed a cavalcade of incompetence and who has to choose to allow it, or face an onslaught of personal attack and legal action.
This is crap, total crap and I’m not going to fold, not at this point. They’ve already screwed with me and my family so much, and I will not be bullied into discontinuing my work here. This state agency is wasting money, telling stories, and paying subcontractors who seem more focused on spending their time and money bludgeoning critics with legal threats and lawsuits rather than working to promote Maine tourism.
This is supposed to be our biggest industry, but it’s being run like a trailer-park daycare on its 3rd notice from the Human Services people.
Qwest CEO Talks Out of Both Sides of His Mouth
Filed under: Internet Strategy – May 04, 2006
Chariman/CEO Dick Notebaert both supported Net Neutrality and told investors in no uncertain terms that they would charge providers for “enhanced” access in their earnings call. At first he sounds like Qwest will be one of the good guys:
Let me say very clearly: Qwest supports net neutrality and we have done so from the very minute the FCC policy statement was issued last August 5. Kevin Martin stated those principles and we support him. That policy was meant to ensure that there is no impediment to anyone’s ability to fully utilize the net.
Wow, this sounds great. They support Net Neutrality.
Our goal is to offer customers including content providers the opportunity to enhanced their customer experience and provide faster delivery for their products. And we will be paid accordingly for this product segmentation opportunity.
Oops! I guess if you want high speed access to Qwest customers, you better be ready to pay extra. Enhanced experience and faster delivery does not mean that customers will get blazing speed for all services. It just means that an “enhanced service” such as VOIP, Video, downloads, and other high bandwidth services might be so average as to be painful compared to the blazing high speed that the favored services will get.
Adelphia just upgraded my home account to 6 megabits per second. Does this mean that those who pay for enhanced access to me will be at 12 megabits? I don’t think so. I’m paying for 6 and that will be the fastest I’ll get no matter who pays what for access the network. If they introduce tiered service, I’m sure they would throttle high bandwidth non-paying services to 1 or 2 megabits, and let those who were blackmailed into paying extra get to me at 6 megabits.
Golden Triangle Not so Absolute
Filed under: Search Engine Marketing – May 04, 2006
Gord Hotchkiss of Enquiro reports in a recent Blog post about an eye tracking study done recently that went one step further than the previous one that came up with the Golden Triangle moniker. Most of the conclusions I have heard and read from the first study were that you had to be in the top few results or nobody would see you. This one looked at relevancy, and it showed that you have to be relevant as well, and that non-relavant results wre skipped in fractions of a second.
But none of really care where the user looks. In reality, we only care about where they click.
Finally, we recorded where the eventual clicks happened. In Google’s case, 26% of the clicks happened in the top sponsored ads, with Yahoo it was 30%, and MSN came in with 17% click through on top sponsored.
This says that 74% of Google clicks were outside the top sponsored area, 70% for Yahoo! and 83% for MSN.
Gord concludes:
When it comes to capturing a searcher’s click, you have to deliver relevancy. It’s not all about position, and that will become more true in the future, not less.
Blogger Wins Battle, Agency Really Loses War
Filed under: Online Publishing – May 09, 2006
MediaPost reports that the clueless agency responsible for suing a blogger, as I wrote about last week, for criticism has folded. I read that they had withdrawn their lawsuit, but the news of their demise was a surprise. I can find no word of this from their overly flash laden site, so perhaps there will be an update soon if the news of their demise was premature.
Warner Bros Online Partners with 180solutions
Filed under: Adware, Spyware & Greynets – May 10, 2006
Warner Bros. Online has begin a partnership with adware company 180solutions to distribute shows created for the Web. Users can only view these shows, currently there a soap opera and an animated series, only from Zango.com and only after downloading their adware. Since each show has a well defined target demographic (females 35-54 for the soap opera and mailes 18 to 24 for the animated series) I’m sure they can better target the pop-up advertising to these visitors.
I’m hoping that Warner know who they are getting in bed with. I did not complete all the steps as I don’t want to install any software on my computer, but this is supposed to be an open download so at least the viewers should know what they are signing up for. Time will tell.
Brands Bring Banners Back
Filed under: Online Advertising – May 12, 2006
I just read two articles that talk about not only the growth of online advertising, but the source of the dollars and the result that banners may be making a comeback. Driven by a shift in ad dollars from print and broadcast and increasing awareness of the importance on online. As I wrote about back in April, display advertising had a larger growth by a few percentage points than Keywords. The conclusion: Big Brands are realizing that the Internet is still a bargain and is the place to spend their advertising dollars.
The article in the Wall Street Journal notes that brand advertisers are driving the growth of display advertising. It implies that paid search advertising is slowing due to saturation (I’m not so sure of that myself), and the next place for growth is the old banner style ad. Of course, technology has changed a lot since the late ’90s and banners are no longer animated billboards. The article continues to talk about how new tools allow brands to monitor the effectiveness of online campaigns and advanced technology for delivering the ads is what turned the tide. Rich media ads allow more information and even interaction with the ad, without increasing the intrusiveness of the display advertising. See the AOL Movie Page and look if the Poseidon ad is still there for a great example of this.
Large brand advertisers are spending billions online. PepsiCo Inc. doubled it’s online display advertising spend in 2005, allocating just 2% of it’s total US spending. With US consumers spending close to 20% of their time online, there is a large disparity – and opportunity for huge growth – in the money spent reaching online customers. While the Web is accountable, Brand advertisers are not looking for the same kind of tracking that results based advertisers would want.
“We’re not as much about click-throughs,” said John Vail, director of the interactive marketing group for Pepsi-Cola North America. To gauge effectiveness, the beverage giant is participating in a program run by Yahoo Inc. and market-research company ACNielsen that tracks the online behavior and offline purchases of about 36,000 U.S. families.
The CNET article also talks about improved tracking technology, but it also points to statistics from eMarketer that show large projected increases (24.4%) in online ad spend compared to much smaller growth (4.2%) for all media.
Things have changed since the late ’90s as advertisers have become more comfortable with the Internet as an advertising medium. It was very easy for them to pull dollars from the Web or ignore it completely, but you just can’t do that today.
During the previous boom, “traditional advertisers hadn’t yet embraced the medium, so growth slowed,” said Denise Garcia, an analyst at WR Hambrecht + Co. “That’s not going to happen again because Procter & Gamble, large auto manufacturers and other companies have said they are decreasing spending on traditional media, like television, in favor of online media.”
A telling statistic comes from this paragraph:
Ford Motor, for example, dropped its magazine ad allotment from 23.5 percent to 21 percent last year but increased its spending on the Internet to 3.5 percent from 3 percent, according to AdAge.com. The company’s overall ad budget remains flat, the article said. Ford, General Motors and Absolut Vodka all reportedly plan to spend 20 percent of their marketing budgets online this year.
Wow!
Telcos Begin Propaganda War on Net Neutrality
Filed under: Internet Strategy – May 12, 2006
A group calling themselves “Hands Off the Internet” is painting themselves as a grassroots nationwide coalition of Internet users opposing government attempts at regulating and taxing Net content or commerce. They have created an animated cartoon that obfuscates the issues and makes you think that big companies like Google, Microsoft, and Yahoo want to make us pay for infrastructure improvements through government regulation. The site is full of doublespeak turning the issue on it’s head.
They use a counter-culture net-guy as the speaker and a David vs. Goliath theme where the Telcos are not even mentioned. They tell us that it will cost a lot of money to lay cable and fiber, and that Google and the like want to use that bandwidth to stream HD movies to us – and that they don’t want to pay for it. Now, who other than AT&T; and Verizon have planned to stream TV content over fiber? None that I know of. They make it look as if the legislation to maintain Net Neutrality will be a mountain of regulations and show them crushing the poor sysadmin.
Their slogan is to “Say No to Government Regulation of the Internet” which I do agree with. We don’t need regulation, we need freedom and content neutral routing of packets. If we need the government to create a law insuring this, then fine. Did you ever read about people asking the government not to regulate “free speech” or “unreasonable search and seizure” because that would just be adding too much paperwork to the constitution?
The cartoon makes it seem like the “Save the Internet” people are loons. They talk about building the next generation Internet and that will cost a lot. then they say that these big corporations want to stream all this data to us so they can make billions and stick us with bill. But isn’t this really two sets of huge corporations against each other. They lie when they say that the two sides are the services and us. They completely forget the Big Telcos. When these companies laid telephone wires, who do you think paid for it? We did! The government helps out (so we paid), and they charged us fees to use the services, so we paid again. Now they are laying fiber and cable, and they are still charging us, so we will pay for this either way.
They claim the legislation will “fundamentally change the way the internet works” and that we don’t want the government getting involved. But the only change being contemplated is their own “tiered” Internet. Net Neutrality means status quo. We don’t want to see ANY change to the way it is working. It is the Telcos who want a fundamental change.
And if you are Canadian, they go after you as well. They tell us that there are “only two examples” of ISPs blocking service, and that they were in Canada. Then they show a Mountie on a moose singing “Oh Canada.” Any Canadians want to chime in on this disparagement?
They finish by asking who should control the Internet, the people or the Goverment? And who should pay for this, the corporations or you? Again they left themselves out. I’d rather people or the government control things over the Telcos and service providers. But they make you think that there is a change in control. The government already controls it. We just want them to make sure it stays free and open. We don’t want regulations, but the opposition is forcing the issue.
Online Isn’t Alone: TV Ads Placed Poorly
Filed under: Contextual Advertising – May 14, 2006
I just watched the latest edition of “The Amazing Race” (with a DVR you watch when you want) and saw a perfect example of the advertiser not knowing where their ad will be placed in the context of a TV show. In this show, the Hippie team of BJ and Tyler were at a “Fast Forward” challenge where they had to eat a large bowl full of deep fried crickets and grasshoppers. Cut to commercial.
The final commercial of the break started with a voice over, saying “This show is brought to you locally by Dove Chocolate.” You see a beautiful young woman reach into a big bowl of red foil covered heart shaped chocolates, taking one, then unwrapping it and taking a bite in pure pleasure. What pleasant experience do you see next? BJ and Tyler struggling to take a fried bug from a big bowl and pop them into their mouths with loud crunching noises, followed by them sometimes successfully trying not to throw up.
So, did the buyer for Dove know anything about the content of the show or where in the show their ad would appear? Did the people placing the ads into the show purposely place the Dove ad juxtaposed with the fried insects? One wonders.
Google Trends: Regional Gold Mine
Filed under: Search Engine Marketing – May 15, 2006
After reading Wayne Porter’s piece on Google Trends I had to play with it as well. I found that sex is more popular than Google, poker, Bush, and Microsoft. After doing some serious research, I noticed the regional data below the trend graph. Not only do they show you what is popular over time, but you can also see where these terms are popular. I found that you can also swap the order of the search terms and get different results because the secondary term may not be in the top ten lists for some cases.
The default look is cities, and that can be great to research if you have a regional product. For example, I see that perhaps I should concentrate on regional results for South Florida and Southern California to catch people who are looking for banners (although this keyword is poorly chosen). Cities is interesting, but I really saw actionable data when I looked at the regions since we deal with international customers.
Note that “banners, classifieds” and “classifieds, banners” have very different results when you look at the top regions. Let’s say I just chose to use the results for the “banners, classifieds” search and looked at the results by region. I’d see this and get a good idea for my top 10 countries for banners, and then I might also use that same results set to conclude that Canada, USA, Australia, India, and the UK would be my top countries for classifieds.
But now check out the results for “classifieds, banners” by region. You still see the same top five in the same order, except for one interloper. Look at that, South Africa has nearly the same volume as the USA, and it is a market that I would never had expected to go after.
And for my fun search, can anyone explain why English is the 9th most popular language to search for sex?
Is It OK for Politicians to Spam?
Filed under: Internet Strategy – May 17, 2006
For the first time I have received pure political Spam. I don’t mean the stuff my ultraliberal parents send, or the stuff I get from MoveOn, the Republican Party, or the UCS. This stuff really is Spam. It is Unsolicted and it is Bulk. So why is it that someone running for office thinks that they can Spam, and how did they get my email?
The first one I got was intriguing, but it was sent by a politician I knew for a candidate he supports. We have a prior relationship. I could live with that. What I have trouble with is getting a mass email from someone I have never heard of. True, this man is running for State Treasurer, but he is a currently seated member of the state Assembly and one would assume he has been involved in some debates and lawmaking in the area of Spam, as he was in office in 2003 when the legislature passed SB 186, later superseded by CAN-SPAM.
The email footer explains why I got the email:
You received this email because you are registered to vote in the State of California. If you would like to be removed from this list please unsubscribe by clicking here. Please do not reply to this email. We will not be able to make individual responses to this email.
So does this mean it is open season to Spam voters? Who supplied my email address to the candidate and is that legal? I’m not sure where I would have given up my home email address, but I can’t believe that it is OK to sell it, even to a politician who thinks he can garner votes through Spam.
Spammers Attack Back: BlueSecurity Closes Doors
Filed under: Adware, Spyware & Greynets – May 17, 2006
A massive DDOS attack against Israeli anti-spam company Blue Security by Russian Spammer PharmaMaster has succeeded. Blue Security announced today that they have ceased operations. Blue Security did have a rather controversial model – Spam the Spammers – but it worked.
The idea was that they had over 500,000 users, and when they detected Spam they would bombard the Spammers with requests to unsubscribe from all of them at once. The intention was to overload their server and make it untenable to send Spam.
Obviously, this tactic must have worked well, because the Spammers fought back and used vast Botnets to attack not only Blue Security, but they caused serious disruptions for service providers hosting the company’s servers, they interrupted service at Tucows, and they knocked out thousands of blogs being hosted by Six Apart after PharmaMaster launched a DoS attack against a server hosting a Blue Security blog.
Getting LOST With Sprite
Filed under: Online Advertising – May 19, 2006
I’m really sorry that I did not catch this sooner. I really should have picked up on the clues. For you fans of the TV show “Lost” there have been some clever clues linking some Web sites with the show. Three weeks ago there was a :15 commercial for “The Hanso Foundation” (which is the fictional group running the experiments on the island) with a phone number. I did not bother to call the number, but the next week they added a Web address: www.sublymonal.com. I just assumed that this was in intentionally odd spelling of subliminal, until I got to the site.
Once there, the text in the title bar says “subLYMONal”, which I assumed was referring perhaps to someone’s name (Lymon). You see six TV screens rotating around the word “OBEY”, which sounds like something you would expect from a Lost associated site. Anyone get the connection yet? I didn’t.
I was not thinking until I saw something today on the relaunch of an ad campaign for Sprite. They are going back to their roots and using the term (you guessed it): Lymon. And what is the Sprite Tagline? Obey Your Thirst. Here’s where the tie in with Lost appears. Their new spots have accompanying text that reads “DVR Ready,” so that you can make sure to pause the commercials and really pay attention to them to find the embedded content. The spots close with the line “SubLYMONal Message Complete” and a shortened tagline, “Obey.” You are then directed to the Web site, sublymonal.com.
Circle complete.
The Thruthiness of Net Neutrality
Filed under: Internet Strategy – May 24, 2006
Craig Newmark and Mike McCurry debate Net Neutrality in this Wall Street Journalarticle published today. McCurry continues to spout the Telco talking points and Newmark nails him to the wall with actual information.
Newmark’s conclusion opens with
I realize you’re cleverly using Colbertian “truthiness,” and I just can’t compete with that. Nerds are notoriously literal.
It is amazing to read some of McCurry’s points. It sounds like he supports Net Neutrality when he says “”let the current rules govern,” and then asks “Is there a real problem now with discrimination on the Net?” How can he ask that? Of course there is no problem now. We have neutrality!
Much of McCurry’s argument is based on the coming bandwidth crunch, based on what he is told by his employer:
I am not a techie but one of BellSouth’s chief architects [Henry Kafka] said recently that the average residential broadband user today consumes about two gigabytes of data per month. Watching TV over the Internet would consume 224 gigabytes per month. Regularly downloading movies would average nine gigs. We do believe that video over the Internet is in the near future, right?
This one gets to me for so many reasons. Who will be sending this TV over the internet? Verizon and AT&T; are the only ones I know if planning to do this, and they are the ones lobbying the hardest to wipe out Net Neutrality.
Craig Newmark is an engineer, and he says he talks to a lot of employees at these same companies that claim that there is a coming bandwidth crunch. He says that there is a lot of unused capacity, but the real problem is sluggish adoption of IPv6which is required for future growth. Newmark backs up his statement about the glut of bandwidth:
I also work with some of their engineers, talking about the way big telecoms operate and issues like network capacity. It turns out that they have lots of unused capacity for bandwidth, but the big telecoms have been very remiss in implementing the newer Internet protocols (IPv6) required for growth, due to bureaucratic inertia.
and
For that matter, the hard part of the infrastructure is already done: “The backbone was terribly overbuilt,” says Fiber Optic Association President Jim Hayes [according to a September 2004 article published on StreamingMedia.com.] “Ninety-three percent of all the fiber that’s been installed is still unused.”
Newmark also brings up the issue of trust. McCurry argues that everything will be OK and that market forces will make everything turn out just fine. If someone does violate the rules and slows content from some small fry, the FCC, FTC, or Justice Department will step in and save the day. But we should not worry about this because his coalition has ” pledged to abide by the principles the FCC articulated last year — no discrimination against content and no degradation of service.”
Newmark takes him to task here with a quote I have not used in any of my articles here or seen before:
FYI, Bellsouth guys have admitted that they don’t intend to play fair [according to a December 2005 Washington Post article]: “William L. Smith, chief technology officer for Atlanta-based BellSouth Corp., told reporters and analysts that an Internet service provider such as his firm should be able, for example, to charge Yahoo Inc. for the opportunity to have its search site load faster than that of Google Inc.”
I’d like to conclude with an excerpt from Newmark’s final statement:
What we’re looking for is just fairness, a level playing field, no regulation or stuff like that. In America we believe that if you play fair and work hard, you get ahead. We don’t want the government to give special privileges to the big guys, particularly not at the expense of small business and consumers. We don’t want more regulation and we don’t need lawyers involved where the free market functions well. I guess we’re for capitalism.
Current net neutrality (as currently conceived) functions well, allowing innovators to create wealth and help us all out. Why should the FCC or Congress fool with that? We’ve seen that the telecoms don’t need more privileges, they need to get serious about using their existing resources.
Even Mike’s clients have confessed that they intend to discriminate. They consistently forget who owns the airwaves and public rights of way on which they’ve built their fortunes. They frequently break their commitments; take a look in the Journal at the Walt Mossberg piece I’ve cited.
Ferbers Out at Advertising.com – AOL Taking Over?
Filed under: Online Advertising – May 24, 2006
Scott and John Ferber, founders of Advertising.com, have quietly left the company. Lynda Clarizio, a business executive at AOL, has been named president. This is significant AOL originally stated that Advertising.com would be managed as a separate company. By placing an AOL insider at the top of Advertising.com, it makes it quite easy to integrate them into AOL in the near future.
I’ve seen actions like this before, both in the Aerospace realm where I worked before and in the internet space since then where the initial promises are that the old company will not change and will be able to function as it has with it’s old leadership. But after a while you find that all the new executives are from the parent company, policies change, and soon enough you are a business unit of the parent. Perhaps the Ferbers will surface soon enough and be able to talk about this, unless they signed an agreement to keep quiet. We’ll see.
House Judiciary Committee Passes Net Neutrality Bill
Filed under: Internet Strategy – May 26, 2006
A Net Neutrality bill (H.R. 5417) proposed by Rep. James Sensenbrenner (R-Wis.) and Rep. John Conyers (D-Mich.) passed in the House Judiciary Committee yesterday by a 20-13 vote according the Red Herring and InternetNews.com. This bill is written to specifically prohibit tiered access to their network and non-discriminatory conditions for those who provide content. What is new here is that the bill is using federal anti-trust provisions in the Clayton Act to prevent service providers from discriminating against content or applications providers, as opposed to asking the Federal Communications Commission to handle enforcement.
This is important because the issue is really one of stifling competition through a market they dominate. Sensenbrenner noted that the big Telcos and cable operators control 98% of the broadband market in the US, which is why he said
While the technological dynamics of the telecom marketplace have changed over time, the threat of dominant firms abusing their market power to restrain competition and consumer choice has not. The lack of competition in the broadband marketplace presents a clear incentive for providers to leverage dominant market power over the broadband bottleneck. An antitrust remedy is clearly needed.
Language in the bill has some great protections. It makes it unlawful for a broadband network provider “to block, to impair, to discriminate against, or to interfere with the ability of any person to use a broadband network service to access, to use, to send, to receive, or to offer lawful content, applications or services over the Internet.” It also says that if a provider prioritizes or offers enhanced services for and particular type of data, it must “prioritize or offer enhanced quality of service to all data of that type without imposing a surcharge or other consideration for such prioritization or enhanced quality of service.” These two provisions maintain what we have now, equal access to the internet for all service providers. As states by author Rep. Sensenbrenner
This legislation will provide an insurance policy for Internet users against being harmed by broadband network operators abusing their market power to discriminate against content and service providers.
It is notable that the legislation does not prohibit service providers from charging for different service levels as they do now to customers. It also has some consumer protections built in as it allows users to attach devices to the network as long as they do not degrade others use of the network, and it has terms for “conspicuous disclosure” of terms in “plain language” for all limitations on broadband service.
Gary Morgenthaler, general partner with Morgenthaler Ventures liked the bill, stating
All Internet services should be offered on an equal basis to all the customers, and no content providers should be disadvantaged. The consumer should determine what class of service they require, or the price will be determined by the carrier and the market.
AT&T; executive vice president federal relations Tim McKone had a prepared statement that read
While we are disappointed that the Judiciary Committee chose to move toward regulating the Internet, we are pleased that the majority of the majority recognized that this legislation would deter investment in our nation’s broadband infrastructure. We are optimistic that the majority in Congress will see this legislation as an attempt to solve a problem that does not exist, and will instead focus on bringing choice to consumers by passing video choice legislation.
Nothing like obfuscating the issue. The majority of the majority? Nothing like saying something that nobody can understand until after you have left the room. Of course the problem does not exist. Yet. They are prohibited by law from discriminating, charging for access, and everything else that they have publicly stated that they want to do.
The debate is now expected to move to the floor of the House. The Senate is considering its own telecom reform legislation.
ISPs Already Throttling Content
Filed under: Internet Strategy – June 08, 2006
SiliconValleyWatcher reports that Cox Interactive is already doing what the big Telcos say they would never do, impede access to a competitor’s site. See Cox earns a large chunk of revenue from classifieds, and the site they are blocking happens to be online classifieds powerhouse Craigslist. They have known about this for three months, but when informed that Cox also has classifieds, Jim Buckmaster, the CEO of Craigslist commented, “that changes things.”
Indeed.
Cox (as well as many major ISPs) use software from a company called Authentium that is blocking Craigslist, and has been since February. They have acknowledged that they are intentionally blocking Craigslist, and have not fixed this after being asked numerous times by Craigslist over the last three months. Sounds neutral to me.
I wonder who else is being blocked and does not know it?
Go and read the quotes from PR wonk Tom Tauke in my earlier story on this and see how hollow they ring. He talks about “hypothetical” problems and violators being “quickly held accountable” in his article, but I wonder what he would say today?
Good thing there is a vote soon on the House floor on amendments that can insure Net Neutrality in the future. We can only hope that one is passed.
DMA Releases Best Practices and Standards for Affiliate Marketing
Filed under: Affiliate Marketing – June 21, 2006
The Direct Marketing Association’s (DMA) Internet Marketing Advisory Board today released a “Best Practices for Online Advertising Networks and Affiliate Marketing” document. The idea is that this should help the big brands who don’t have the experience or personnel with basic knowledge of the issues of Affiliate marketing.
For example, the number one item on their list is to make sure that the network follows the state and federal laws as well as the DMA’s ethical practices. This is good to put on paper, but wouldn’t you worry about a company that was making deals and had nothing in the contract about following applicable laws? Other common sense items are to perform due diligence to make sure you are working with a reputable network and to always have written agreements.
Then they move on to nebulous points without any explanation of why they are needed, how they can be abused, or how you can do what they are recommending. Point #4 says “Include specific parameters that must be employed to determine placement of your online ads in written agreements.” What does this really mean? Why would anyone care. Without background on how bad affiliates/networks abuse ad placements through multiple sub-agreements, arbitrage, BHOs, auto-loader, meta refresh pages, etc. then how can some brand marketing dweeb even know what to do here?
Why by following step 5, which tells them to develop (how?) a system to monitor their placements! Easier said than done.
Kentucky Follows China’s Lead
Filed under: Internet Strategy – June 23, 2006
What do Kentucky and China have in common? Both don’t let Internet users see content they don’t like. Now, Kentucky is not able to affect all citizens, just employees. While it is reasonable to block access to entire classes of sites such as Porn, Humor, or whatever the employer decides is not appropriate, Kentucky has gone a step further by targeting at least one political blog that is critical of Governor Ernie Fletcher.
The BluegrassReport.org website is very critical of many aspects of the government in Kentucky, specifically Governor Fletcher who has been indicted earlier this year in connection with a state hiring scandal. There are also harsh attacks on the Judicial branch, various ethics commissions, and Republicans in general. While I can see the administration not being happy about this, blocking access is not the right thing to do. I don’t follow politics there, so I have no idea if they are that bad or this guy is a nutcase, but that does not matter. If he really is a nutcase, nobody will care what he writes and the best thing to do is to ignore it. If they really are that horrible, then they really should not have given this guy amazing publicity like this.
Commerce, Science and Transportation Committee Chair Wants Us to Think He Is Stupid
Filed under: Internet Strategy – June 23, 2006
eWeek reports that Senate Commerce, Science and Transportation Committee Chairman Ted Stevens (R-Alaska) does not know what net neutrality means, and until some smart person can figure that out, he wants no part of it in the Telecom bill being debated and appended in his committee.
Stevens told eWeek:
Until somebody tells me what net neutrality means, until they can give me a definition, I don’t want it in there. Right now, nobody knows what it means, so why put it in the bill?”
Does he think that the American public, the people we elect, and the people they appoint are that dumb? The only reason that “nobody knows what it means” is because some people are doing their best to confuse the issue because they want to change things. After all, the idea is not a new one. This is not some new rule that someone thought up that they thought might be a good idea. I can’t find out who coined the term first, but this first came to my attention when the big Telcos started merging a few years back.
Read Verizon’s own news release from October 2005 on the approval of their acquisition of MCI and see what they said:
As part of the FCC approval, Verizon and MCI committed to continue the rollout of Verizon’s stand-alone DSL service, continue to adhere to “network neutrality” principles adopted by the FCC earlier this year, cap temporarily certain special access and UNE rates, and maintain for a period of time the current number of settlement-free Internet peering arrangements.
Then again, Art Brodsky of Public Knowledge has three definitions from the same bill that is under debate. Maybe Senator Stevens has not had time to read it yet.
So does this mean that the government knew what the heck this network neutrality thingy was back then and has forgotten? Is the FCC not good enough of a source for a definition? If we are currently operating under a system called Net Neutrality, then how hard can it be to figure out what it means?
Gee, I don’t know. Maybe we should look around for what others are saying it means. OK, maybe we should limit this to those who don’t have a vested interest in the outcome. So how about the WikiPedia which has a detailed entry and history? Or we could check our other bloggers such as Don Dodge who has a pretty simple definition:
It means that all web sites and services are equal and get the same rights to bandwidth from the carriers. So, email, web site content, music files, video, VoIP, IPTV, etc., all get equal access to bandwidth without any additional charge.
I always thought it was pretty simple. An ISP or bandwidth provider must route all traffic and treat it equally. Too simple for the government.
Yet Another Post on 500Words.com
Filed under: Internet Strategy – June 27, 2006
OK, I think we all know about the site by now, and after reading some of the comments I had to check into this a bit and make a post myself. Let’s look at the value proposition and metrics. Oh that’s right, nobody can tell how well this is working. Just about everyone (95%) who set up a link there did not include a tracking URL! I thought we were all advanced marketers here. Unless everyone has a great web analytics package that can not only track incoming traffic, but also associate bottom line results to these customers by referral URL, then very few people will really know if this was a bust of not.
First off, a disclaimer. I did purchase two terms, one for each of our main sites. A quick check shows that they have sold 217 words so far. No I did not count. This is very easy to do with FireFox and Excel. Once copy and paste and I have a full count of links and sold links. Looking deeper at these links I find that at most 11 of them have any kind of tracking, and I’m being generous as two of them may just be sending visitors to a person’s sub-site for some program that they use for everything. Even so, this means that at most 5% of the people paying for links here are not doing a very good job of tracking the activity. How will they know the ROI?
Not that there are too many opportunities like this where you need to know, but you at least want to separate out traffic from 500Words from generic referral traffic so you really know what is going on.
For those who have been mocking this site, check out their stats. I expect to see them on the Alexa Movers & Shakers soon enough. Say what you will about the idea or novelty of it, or SEO benefits, but when was the last time you saw a site go from dead nothing to an Alexa rank of 1,684? While most Alexa data is pretty worthless, once you crack into the top few thousand, you really do have substantial traffic.
Looking at my own data that only covers 24 hours or so, 500Words has already become one of the top 10 referring sites for the week for EPage.com. Conversion rate is looking to be about 3%, which is not nearly as high as we get from Google. Have we made back our investment yet? No. But we might.
Whether we do or not, I will know it. That is more than I can say for 95% of you out there.
News Flash – Banners are Still Not Dead!
Filed under: Affiliate Marketing – June 28, 2006
Beth was right, the MarketingSherpa Affiliate report has some great information. The shocker for me is that Banners ran neck and neck with Text Links and Content as the top ways that affiliates promote programs.
Question #3 asked of the affiliates was “How do you currently promote affiliate programs? (Check all that apply)” and it had 3,250 Responses from the 1,041 affiliates who completed the survey. They answers were:
19.88% – Text links
18.80% – Banners
18.40% – Content
All I can say is WOW! The next three results were Search Engine Optimization, Email, and PPC. Can you believe how far we have come? Spam and competition have knocked Email and PPC down a few pegs.
That said, I think the results are a bit misleading as written in the report. They took the total number of responses (since affiliates could click as many as they wanted to) and divided each count by that number for their results. This adds up to 100%, but it does not tell you what percentage of Affiliates use each strategy. Using the 1,041 count of total affiliates in the survey, the numbers change a bit:
62.1% – Text Links
58.7% – Banners
57.4% – Content
35.9% – Search Engine Optimization
29.4% – Email
23.4% – PPC
21.3% – Coupons
12.8% – Datafeed
7.4% – Media (Purchasing advertising, print ads, radio, etc.)
1.2% – Misc (see next slide for responses)
1.2% – Newsletter/Blog/Webring
0.9% – Website Links
0.5% – Incentives
This does not change anything, but it at least lets you know more about what the majority of affiliates are using, and that the number one most popular means used that you have control over is the banner creatives you give them. This gives more importance to the effectiveness of the banners you provide, and shows the importance of having simple tools available to get affiliates to implement them for you.
Net Neutrality Loses a Close One
Filed under: Internet Strategy – June 28, 2006
The Senate Commerc, Science and Transportation Committee deadlocked 11-11 (a tie means the vote failed) on a proposed amendment that would have required broadband providers to give their competitors the same speeds and quality of service as they give to themselves or their partners. Senator Ron Wyden (D-Oregon) responded by saying that he would place a hold on S.2686 (The Communications, Consumer’s Choice, and Broadband Deployment Act of 2006) because it lacks strong net neutrality requirements. A hold on a bill can lead to a filibuster, if Senate leaders aren’t able to fix the senator’s objections. Too bad we don’t have Jimmy Stewart on our side.
Here’s Wyden’s take on the issue:
If [broadband providers] get their way, not only will you have to pay more for faster speeds, you’ll have to pay more for something you get for free today: unfettered access to every site on the World Wide Web. To me, that’s discrimination, pure and simple.
Then you read what Ted Stevens, poster boy for the Telcos has to say:
E-commerce companies pushing for net neutrality rules are “enormous” companies that want to profit from delivering multimedia content over networks broadband providers have built. These people who argue they ought to be able to drop all this stuff on the Internet maybe ought to build their own network.
Tell that to Verizon where they happily talk about the actual bill – one that makes it easy for Verizon (and AT&T;) to offer IPTV to consumers:
This bipartisan committee vote – and the huge House victory – prove video choice is within consumers’ grasp this year. The momentum is there if the full Senate acts soon to give consumers the competition and choice they deserve.
So, answer me this. Who is it that will be filling the pipes with massive amounts of content? When can we expect AT&T; and Verizon to go out and build their own network?
So Long 500Words, Hello BidTheGrid
Filed under: Online Advertising – June 29, 2006
Now that Joel has had his 15 minutes we can stop writing about his site and get on to other things. The first of which is that the true strategy Joel had with 500Words was not so much to make a fortune on the actual site, but now he is selling the scriptused to create the site. He says he made $20K in the first 24 hours and expects to make $50K by the time he is done from the 500Words site.
I’m guessing that he will do far better selling the script because #1 the price is a lot higher than selling words, and #2 he can sell as many copies are there are suc- er, buyers willing to pay for it. If you believe his numbers, he already sold the first 25 copies for about $500, and is selling the next 25 for about $600. That is an easy $20K for the first 40 copies sold. By my calculations he will break $100 grand right at copy #142. Pretty good if the sales can continue.
Of course these unique sites flash into existence, burn brightly as others imitate them and then fade away. And this only happens faster if something else can come in and grab the attention away. I have found that next amazing idea at BidTheGrid.com. Instead of buying space that lasts forever, you are only buying space until someone pays more for it. BidTheGrid has been up since March, and so far has 19 ads out of the possible 103 squares. Since you can get a space for free and only go away once someone outbids you, I calculate that they have made as much as $0 so far.
Seriously, while I think the idea of bidding for space on a smaller screen makes a whole lot more sense than the MillionDollarHomepage, these folks are daft if they think they can make much of anything without a real strategy. Joel had his list of followers to leverage who not only were the right customers, but they also trusted Joel and his ability to generate publicity and thus traffic to the site. Alex Tew spent money on a publicist to get him started. Here you have another site that has actually been around for months, but has nothing to show for it. Maybe Joel can get their script and show them how to make money with it too!
Beachvertising, Beastvertising, Breastvertising, and More!
Filed under: Online Advertising – July 05, 2006
Want to put your logo or ad on an animal at a Zoo, offshore at the beach, on a prostitute, on prayer mats in a Mosque? A new site at In Stores Now promises all that and more!
Of course, none of this is serious. But it is a great site. Created by a Dutch design student, the site is a parody of the intrusion of advertising into our lives. He shows examples of logos on a Lion, Fish, and Penguin at the Zoo; but it gets better. The examples continue with examples for religion, music, the Sex trade, construction, and of course, Beachvertsing.
Those who take this seriously and call the contact number to get started are kept on hold and end up hearing endless sales pitches until they give up.
Blipverts Making a Comeback
Filed under: Media – July 07, 2006
For those of you too young to remember, Blipverts were invented back in 1987, but unintended consequences forced them off the air. Now, USA Today is reporting that television advertisers are attempting to reach the DVR generation with five second ads. They talk about a current Honda ad, and mention that AOL did this earlier in the year. In addition, GE has a series of One Second Theater ads that were tacked on to the end of two commercials aired back in May.
As I recall, AOL had to buy 30 second spots for Fox to accept their five second ads, but they still get them out there. But Television is not the only place for these. Clear Channel Radio is a big fan of this idea and has created one second “Blinks” featuring a McDonald’s tagline or Intel’s signature tones. The companies did not create the ads, and they have not aired as far as I can tell.
And while doing some research on this, I came across this site claiming to be developing ads with the old blipvert name, although not the same ad. Of course it is just a basic template site with a few of the pages filled in, so it might be a joke. Then again, they are looking to hire pretty much the whole company.
If this trend continues will we see a rash of exploding heads?
Affiliate Summit First Scoop: CJ Legacy Links Not Going Away
Filed under: Affiliate Marketing – July 09, 2006
I just heard from a very reliable source that CJ will not be turning off Legacy links in six months as planned. LMI will no longer be the only way of linking and Legacy links will be around for the foreseeable future.
AffiliateSummit Day 1 Report
Filed under: Affiliate Marketing – July 09, 2006
Day 1 is about done, except for the hearty crowd partying the night away at Paradise Island or the local bars. Overall the day was mixed. The facility is great, much nicer than Vegas. No smoke filled halls to navigate and the rooms are great. The ballrooms and hallways are clean and staff is helpful and friendly. Summit staff is well organized and I have not heard one complaint about problems registering or with anything administrative.
That’s the good news. Today after registration was the “Meet Market & Vendor Showcase.” The schedule described this as “an extended session of structured, face to face networking. Merchants will have tables set to meet with affiliates to discuss their affiliate programs and cut deals. Vendors that cater to affiliates and merchants will also have tables to share information about their products and services.” Too bad half the merchants and vendors with tables forgot to show up. I don’t know what the problem was, but many did not plan ahead for this. Some were not in town yet, and others just forgot about it. At one point I told someone that they had a booth and they did not know about it. When I wrote my blog post earlier, I sat at the vacant Performics table and ended up talking with a few people.
The actual session itself was not bad. A few hundred people came through and there was a lot of networking and contact. My brief stint writing generated traffic with people who did not know me coming by to check out the table. That does imply that those who did show up should be pretty happy that they staffed their table.
Next was the “Ice Breakers Networking Session” in a huge ballroom. Quite a number of people showed up and congregated near the complimentary drinks (beer and wine) and started networking. Staff then directed us to sit at a table and get started for the networking activities. Jeff Molander tried hard to get people’s attention and tell them what was going on, but the speakers did not reach the bar areas and with all the noise of the people networking, they had trouble hearing what he was trying to tell them. Once we were all seated, Jeff instructed everyone to stand and find a stranger to talk to. Since most of us were already seated and networking, Jeff had to silence the crowd to get us to hear the instructions on how to network. There was another attempt at having us try a playful networking activity, but I think the crowd ruled and did what they wanted. I’m not complaining, and I did fill my time finding new people to talk to, but the attempt to organize close to a thousand people was doomed from the start.
Networking is great, and the last show’s disaster of organized appointments where most people did not show was even worse, but I think this still has not been perfected. Perhaps they are better off with a bunch of smaller rooms with maybe a couple of hundred people max (to keep the noise level down) in each and make it an unstructured free form networking. Either that or have multiple rooms with themes to group people or “styles” of networking.
I really look at today as a pre-conference day since the Keynote is not until tomorrow. As such, the day was not bad. We had a well run check-in and I got a lot of time to meet people, network, and talk with old friends. While things could have gone better, I really can’t complain and have a very positive feeling from my time spent here.
The Torch Passes: Tim Storm Receives the Affiliate Summit Legend Award
Filed under: Affiliate Marketing – July 10, 2006
After an entertaining keynote by Jim Bouton where he told the audience to do what you love because you will “make your best pitch,” Wayne Porter presented Tim Storm of FatWallet.copm with the Affiliate Summit Legend Award.
Tim was honored for his years of efforts in this industry over the years and for going the extra mile for everyone. In fact, he treats everyone as a person, not as a customer or employee.
Jim Bouton’s closing thoughts were to be persistent and have fun. Makes sense to me, and this describes Tim to the letter.
What’s on TV? Check Your Food
Filed under: Online Advertising – July 17, 2006
Will CBS end up with egg on their face if their fall schedule is a bomb? Or will they get rotten eggs thrown at them from viewers who don’t laugh at their Monday night lineup of sitcoms? The egg-heads at CBS have decided to jump from the fire into the frying pan and place ads for the fall schedule on 35 million Eggs.
At least they are having fun with this. The CBS press release also contained a sampling of CBS egg slogans including “Crack the Case on CBS” for smash hit CSI, “Scramble to Win on CBS” for reality show The Amazing Race, and “Find Your Chick on CBS” for the sitcom How I Met Your Mother. Variations on the ad for its Monday night lineup of comedy shows include “Shelling Out Laughs,” “Funny Side Up” and “Leave the Yolks to Us.”
Maybe the marketing staff will be beaten if the idea is not it’s all cracked up to be. When the dust settles we will know if the idea was scrambled, or if it went over easy, or maybe turned out sunny side up.
Just don’t egg me on or I’ll keep going and make a really bad yolk.
Gambling CEO, Others Arrested in US
Filed under: Affiliate Marketing – July 18, 2006
BetOnSports CEO David Carruthers was arrested in Texas while trying to make a connecting flight Sunday from the United Kingdom to Costa Rica. Four others were also arrested – three in Florida and one in Pennsylvania. Eleven people in all were charged for allegedly committing conspiracy, racketeering and fraud in taking sports bets from U.S. residents. The Justice Department said Monday it is seeking the forfeiture of $4.5 billion, cars and computers from the defendants, including BetOnSports and three other companies.
I have written about this before, and now the US government is getting more aggressive. They are not afraid to extradite those who they want to reach, making many gaming executives think twice about travel to the US. I’d also be thinking about which countries have extradition treaties as well. But since this is not a forum for talking about the legalities or ethics of online gambling or gambling (one being bad and one being good according to our lawmakers) in general, I want to point out one small sentence in the story:
Others named in the indictment include Kaplan’s sister and several BetOnSports employees. The other three companies named in the indictment are based in Florida and handle promotional activity for BetOnSports.
The other three companies are based in the US and “handle promotional activity” for them. What does this mean for affiliates and networks who have operations in the US? Are any of these Florida companies affiliate or CPA companies we might know?
While all the top gambling affiliates I know are based in other countries, I see gambling companies such as 888 and Poker Affiliate at events such as Ad:Tech and AffiliateSummit. What are those companies doing there? I did not spend much time talking to them, but I have to assume they were looking for affiliates.
Can they answer this question: Is it legal for a US based affiliate to promote their offering? I do not know for sure, but I actually suspect not. If it isn’t, then is it OK for them to be at these shows attracting affiliates. Do they have an obligation to disclose the potential legal implications to affiliates.
While the government loves to go after the big fish where they can make big headlines, imagine what happens when they realize that a large percentage of the referrals come from affiliates and they can also make big headlines by going after them – even those living outside the US.
Clueless Affiliate Marketers and SEO
Filed under: Search Engine Marketing – July 18, 2006
Shari Thurow just posted a great piece over on ClickZ on SEO and Affiliate Marketingwhere a moderator at a supposed Affiliate Marketing event said that “The event is focused on affiliate marketing, not search.” I like Shari and have followed her for close to ten years. I don’t always agree with her because she often has a dim view on affiliate marketing as it relates to search. but here she is pretty much on target, and at least she did know that affiliate marketing does care about search.
She does give some Webmasters praise, as she says “some of the best Web sites I’ve ever seen have been affiliate Web sites” and she also says “Affiliate management is a key ingredient of an effective SEO/SEM plan.” And she hits on many issues we have seen discussed here and heard on panels at the various conferences about the affiliate channel stepping on the toes of the merchant’s own efforts. She even goes as far as saying that “corporations could save thousands of dollars in lost search engine traffic if they created legal agreements before hiring affiliates.” Now, affiliates are not “hired” but we can forgive this I think.
While it seems as if some of this was written to cover a different kind of affiliate, maybe there is just continuing confusion over exactly what constitutes affiliate marketing to someone so ingrained in search? I’m not sure what she means when she talks about “affiliate marketing agencies” and how they don’t get SEO, but then again maybe here she does not get Affiliate Marketing all that well either. Maybe we should invite her to the next Summit in Vegas where she can tech us and we can teach her as well.
Update on Gambling Indictments
Filed under: Online Advertising – July 19, 2006
Luckily I don’t recognize any of the companies or named individuals named by the government in the indictment unsealed Monday as reported by http://adage.com/article?article_id=110585.
DME Global Marketing & Fulfillment, Direct Mail Expertise and Mobile Promotions and four of its principals — William Hernon Lenis; his son William Luis Lenis and daughter Monica Lenis; and Manny Gustavo Lenis, a nephew — were named in an indictment unsealed yesterday accusing BetOnSports and its principals of illegally engaging in internet gambling and tax evasion.
The above executives and their companies were charged with engaging in a racketeering conspiracy. Namely “working to illegally advertise and support several websites by buying ads, sending equipment and prizes for the site to Costa Rica and eventually serving as the fulfillment house for internet-gambling prizes.”
Note that they were buying ads as well as sending support to Costa Rica. It also looks like one of the biggest no-no’s they committed was that they “falsely stated that internet gambling on sporting events and contests was ‘legal and licensed.'”
WTO Investigating US Rules on Internet Gambling
Filed under: Affiliate Marketing – July 20, 2006
I guess I’m noticing all the Gambling articles this week. The latest to catch my eye was a headline saying that the WTO is looking to see if the US restrictions on Internet gambling comply with international trade rules. The tiny Caribbean country of Antigua and Barbuda (yes, I had to look it up to make sure that this was indeed one country) is challenging the big bully USA over the issue on online gambling. After negotiations with the US broke down, they requested (and were granted) a panel be set up to report in how well the US is complying with earlier rulings.
The argument is based on US laws prohibiting residents from placing bets in online casinos (while at the same time allowing online bets on horse racing or state lotteries). Previously the WTO has ruled that some US laws were in compliance with international rules and some were not.
The Antigua representative said:
The United States has been busy passing legislation that is directly and unequivocally contrary to the ruling. Antigua and Barbuda considers that the United States has taken no measures to comply with the recommendations and rulings of the DSB (Dispute Settlement Body).
Antigua is attempting to diversify their economy away from tourism through online gambling – since it is legal there and most everywhere else. Antigua points to three specific US laws – the Wire Act, the Travel Act and the Illegal Gaming Business Act – that prevent companies from legally accepting bets from the US.
The recent indictments against the CEO of BetonSports and 10 others are felony violations of federal laws relating in part to the 1961 Wire Act, intended to stop interstate gambling over the telephone.
Domain Hijacking Hijinks
Filed under: Adware, Spyware & Greynets – July 21, 2006
I just saw this article at eWeek that shows proof for the first time that I have seen that someone really is watching what you type when checking on potential domains – and then registering them! It outlines both a user and the authors test of the CNet Domain Search page, which is actually using Search.com, which is actually using web.com, dotFM, e-nic, and APlus.net where the domain researched was registered with an outfit called Chesterton Holdings within a day or so of the search.
Evidently Chesterton Holdings uses an “automated process” which seems to be another way of saying that they monitor whois requests and use that to decide what to register. When they do, they cover the page with the ads you usually see on parked pages – and the ads were all syndicated through information.com.
I figures I should do some research into this company, so I checked them out in Google Groups. They have a few entries for similar complaints. But why stop there. Let’s check out their own whois data:
Registrant
————–
Admin Admin
Chesterton Holdings
655 Flower St, #254
Los Angeles, CA, 90017
Creation Date: 03/08/05
Expiration Date: 03/08/07
Domain Servers
ns1.nameking.com
ns2.nameking.com
But who else is on this server? There are six other domains hosted there:
fieldlakeandsky.com
hornbrookcompany.com
hornbrookholdings.com
juccoholdings.com
laporteholdings.com
munchaleholdings.com
Those names sure look suspiciously similar. Check out the actual sites, and you will see that FieldLakeAndSky, Laporte, Jucco, and Munchale all work like Chesterton, with the same “inquiry form.” Only the two Hornbrooks don’t with one a 403 Forbidden, and the other just a logo page without the inquiry form. These two domains are older than the rest, so maybe they have served their purpose and are no longer being used. What other similarities can you mine? How about where they are located?
Chesterton is in downtown LA at a Mail Boxes & More using Box #254, and if you look at the addresses of the others, you will find that Jucco and both Hornbrooks are owned by Jucco Holdings at Box #337. Oh look, Munchale is also there, using Box #253. Their phone numbers are different, but that does not mean much. LaPorte is nearby, west a few miles at an UPS Store. FieldLakeAndSky has the same address as a lawyer in Wyoming, but the phone numbers differ.
But what if you look up their phone numbers? Maybe you can find more! Jucco’s phone number is a Cell phone in LA as is Chesterton’s and Fields (but in Wyoming), so that is a dead end from a Web search. LaPorte Holdings is a real PacBell landline with a real address! Of course it is located about a block from the Mail Boxes store, but it is a general office building. I also found references to the phone number in other places, such as this Certified Ethical Hacker Exam Prep: Understanding Footprinting and Scanning page that lists Redriff.com under “Passive Information Gathering” at the same phone number and Wilshire Blvd. address. They also have a report at the RipOffReport.com site related to some credit monitoring service.
I typed in Munchale’s phone number and the first hit was to something called DomainCargo, at the domain LookupToledo.com of all things. What is domain cargo? This is what they say:
Domain Cargo is a service that connects buyers and sellers in the domain name marketplace. We are dedicated to bringing our buyers both quantity and quality when it comes to domain names. We are proud to offer access to a constantly growing inventory of over 50,000 domain names ready for purchase from third party sellers at fixed prices at our web site domaincargo.com (“Site”). Similarly, we offer sellers an outlet to easily and efficiently sell their domain names to a large customer base. Please note that Domain Cargo provides these services to facilitate the purchase and sale of currently registered domain names between buyers and sellers. Domain Cargo is not the registrant of these domain names, nor is it an auctioneer or an escrow agent.
Oh really now? Then why is it when the first name I check out happens to be owned by Jucco Holdings? Same goes for the next four. Why is it that five of five are all owned by Jucco Holdings? Domain Cargo may not be the registrant per se, but they are still blowing smoke here.
What else do these all have in common? They are all hosted by NameKing.com. Who are they I wonder? NameKing is an “ICANN accredited registrar specializing in high quality bulk domain services,” whatever that means. I found a thread in Google Groups from 2004 about domain hijacking where NameKing is referenced. But guess what? They were located at the exact same address as LaPorte Holdings.
I found other references to Nameking where a domain they hosted was reported for spam, among many others like this.
My best guess is that these guys have a hook into the whois queries so they can get good ideas for domains. They can register them through their bulk register and then put up ads and do PPC arbitrage while they list them for sale and perhaps use them for bulk email and other schemes. I spent a bunch of time doing this and went about as far as I know. Maybe someone like Chris or Ben Edelman could dig even deeper by following some of the ad trails.
Has the Long Tail Been Cropped?
Filed under: Internet Strategy – July 27, 2006
Lee Gomes of the Wall Street Journal has written an article where he does his best to debunk much of the “Long Tail” concept coined by Chris Anderson in his new best seller, “The Long Tail.” When I read the article, it all sounded like he found some big holes. But Chris has fired back with his own blog post on this subject and does an admirable job of defending his original conclusions.
I have not yet read the book, so I can’t give my own views on what Chris meant, but the article makes for good conversation. Case in point. Gomes challenges the 98 percent rule (where 98 percent of choices are chosen by someone) and gives examples where
Ecast told me that now, with a much bigger inventory than when Mr. Anderson spoke to them two years ago, the quarterly no-play rate has risen from 2% to 12%. March data for the 1.1 million songs of Rhapsody, another streamer, shows a 22% no-play rate; another 19% got just one or two plays.
I do have to admit I find the idea of a “rule” is hard to swallow and I can see wide variations from this 98 percent figure across different markets and vendors – and time periods.
Gomes also takes issue with the idea that the tail will at some point grow to equal or greater than the head.
I was thus a little surprised when Mr. Anderson told me that he didn’t have any examples of this actually occurring. At Netflix and Amazon, two of his biggest case studies, misses won’t outsell hits for at least another decade, he said. None of these qualifications are in the book.
Gomes continues with an example:
By Mr. Anderson’s calculation, 25% of Amazon’s sales are from its tail, as they involve books you can’t find at a traditional retailer. But using another analysis of those numbers — an analysis that Mr. Anderson argues isn’t meaningful — you can show that 2.7% of Amazon’s titles produce a whopping 75% of its revenues. Not quite as impressive.
Anderson answers this in his blog, referring to an earlier post that does explain quite well (at least as well as you can explain this kind of statistical example) the difference that comes when you look at the numbers from opposite sides. It is very easy to come to vastly different conclusions when you have lots of numbers to play with. You can read each and see who you agree with.
Another example Gomes tells us about seems to miss the point:
Another theme of the book is that “hits are starting to rule less.” But when I looked online, I was surprised to see what seemed like the opposite. Ecast says 10% of its songs account for roughly 90% of its streams; monthly data from Rhapsody showed the top 10% songs getting 86% of streams.
Here Gomes seems to be looking at the number of streams, not the number of customers or products. I’m sure you can take the exact same numbers and show that 98 percent (as it was two years ago, or 88% today according the WSJ article itself) of their tracks get played once a quarter. So now who is twisting statistics? Anderson says he told Gomes about Netflix data that says 95% of their 60,000 titles are rented at least once per quarter. This is the point of the Long Tail – that all the titles not stocked in a local store are being accessed through an online store that does have the massive inventory needed for this, not that 90% of their total rentals happen to be the top few thousand movies available anywhere.
I do have to say that we see this with the classifieds. We tested out a tool called HitTail and looked at the incoming search terms. The top ten terms accounted for less than 3,000 of 50,000 search visitors. The other interesting thing I got from this data was that the 10th most popular term had only 4x the traffic of the 100th most popular term, and 8x the 250th. There is a lot of demand out there for really odd and obscure things, and those who know how to tap that market will succeed online.
There is some demand for everything.
Gamblers Have Little to Fear from Feds
Filed under: Affiliate Marketing – July 27, 2006
The Wall Street Journal is reporting that although US based gamblers account for about half of the estimated $12 billion on online gambling market, they are not breaking any federal laws. In fact, there are only a handful of states that explicitly bar citizens from placing bets online.
For its part, the Justice Department said it is focused on the online gambling businesses, not individuals. “There is certainly not a law that expressly prohibits a bet by a casual bettor,” said a Justice Department official in a phone interview. “We think that is more for state law to decide.”
As I mentioned in a previous post, indictments have been based on the 1961 Wire Act, which forbids companies from taking bets on sporting events over state or international lines. While there have been a few quotes mentioning that some in the Justice department interpret the act to cover those sending or receiving bets, they generally don’t see that they will be going after casual bettors.
Who is the Real Traffic Pimp
Filed under: Affiliate Marketing – July 27, 2006
Peter mentioned earlier that the Affiliate Marketing Panel was so well received at Ad:Tech SF that it was brought back for this week’s Chicago show. Interestingly enough, the panel got a pretty poor review by the Carlen Lea Lesser, writing for the Ad:Tech Blog. I don’t know if it was the change in personnel or the one covering the session, but this was not the same panel I reviewed when I was writing for them.
I guess if you attended this expecting the Affiliate Marketing 101 class, you could be pretty disappointed. I bet that the description of the session was unchanged from SF, but with Ola Edvardsson and Jeff Molander taking the place of Beth Kirsch, Peter Figueredo, and Marissa Levinson, you will not get the same perspective. If I were there I might have loved the session because it was not the same as before.
At the end of the post, the author mis-attributes the final comment to Jeff Molander, as I’m told it was actually Declan (making a joke):
It’s hard out here for a traffic pimp.
Classifieds Convergence at Last
Filed under: Internet Strategy – July 27, 2006
When we started with our Classifieds service back in 1994, the strategy was to go after newspapers and bring them online. We were small and agile and could get them up and running with classifieds online in weeks. We could have print and online with the same content, and we could even drive ads to print from the Web site. We pitched big papers like the LA Times and small ones in the Southern California region. The reaction then was an almost universal “No way! Our classifieds must be preserved and protected at all costs!” It took a few years and many millions of dollars in losses before the newspapers started to realize that maybe they should take their classifieds online.
We had already given up on this avenue when others came in and took over that market And now I see this article on ClickZ where they note that there have been a number of deals recently that indicate that our original vision may be here at last.
Convergence is beginning to hit the newspaper classifieds world if two recent agreements are any indication. One between online classifieds site LiveDeal and e-commerce transaction firm AdStar will bring together LiveDeal’s Web classifieds and local print classifieds, online and off. Another deal aligns Monster Worldwide’s job classifieds site Monster.com with Philadelphia Media Holdings papers through a new co-branded Web destination.
LiveDeal is a site I have watched (with some envy) since they came out, and this is a great development for them. According to the article
Online classifieds advertisers will have the option of upgrading their listings by paying to include them in the classifieds sections of relevant local print papers. On the flipside, print classifieds advertisers will have the opportunity to publish their ads within LiveDeal’s Web listings. After submitting LiveDeal listings, interested advertisers will be sent to AdStar’s platform to purchase print ads in selected papers and customize them.
As newspapers have seen Web classifieds erode their market share and grow to become huge competitors, they have in the past done what they could to segregate themselves from the rest of the Web. Some have made deals with career or car sites to co-brand their content, but there has not been a simple two-way interface that merges online and offline (at least for the big papers) until now.
The classifieds site’s deal with AdStar acts as “a bridge that needs to be built between the online and offline world,” suggested (LiveDeal CEO) Navar. He doesn’t think AdStar’s newspaper clients will face a tough decision when it comes to implementing the LiveDeal classifieds option. “From online to print, it’s just extra money, so I don’t think it will be an issue,” he explained.
Yeah. That’s what we told them more than a decade ago.
AT&T; Is Just a Big Dumb Pipe
Filed under: Internet Strategy – August 03, 2006
I think AT&T; CEO Ed Witacre must be smoking a crack pipe. Whitacre was out here in California speaking to a crowd of about 500 state regulators at the National Association of Regulatory Utility Commissioners (NARUC) annual meeting. This is what he said:
Some companies want us to be a big dumb pipe that gets bigger and bigger. . . . No one gets a free ride. . . . Those that want to use this will pay.
Maybe I’m confused about all this money I pay as a consumer to access the Internet from home. I pay about $50 a month for broadband service to some big company called Time Warner. If not them, I’d be paying Verizon. But what about us content hogs spreading all this data through these big dumb pipes? How can we do this without paying for it? Of course we don’t. I just last week wrote a check for over a thousand dollars for our co-location and bandwidth usage for our Web sites. Imagine the gall of my hosting company to charge me more money when I use more bandwidth!
But maybe all this money is just bypassing poor AT&T; and their buddies? Let’s check out the financials. AT&T; seemed to do OK, with only an 81 percent jump in second quarter profit, earning over $1.8 billion. Considering the large ISPs made over $20 billion last year from consumers paying for access, it is hard to imagine that they are having trouble keeping the fibers lit at night. Then again, maybe it is hard to make money when you spend $100 million lobbying and advertising against Net Neutrality.
But I guess $100 million is a drop in the bucket for a group of companies that earns $14 billion selling special access services to Web companies, ISPs, and other users of the local data networks.
And it is nice to have the government pay you to build these tubes or pipes or whatever you are calling this stuff. Telecoms have been getting tax breaks for years to build infrastructure. In the early 1990s our government offered $200 billion in tax incentives, funding, and other assistance to replace old copper wiring with fiber optic wiring.
Buy, where do our tax dollars go? I thought Google was supposed to pay for this?
1150% Tax on Long Distance, How Can the Telcos Survive on This?
Filed under: Media – August 03, 2006
I just got a phone bill at home for long distance. Since we use cell phones with long distance included we rarely use our land line for toll calls. But last month I called my sister in Northern California and used the land line. She was not home, so the call was one minute long, costing me 10 cents. Not too bad. So then why is my phone bill $1.25?
Because the company charges a “Regulatory and Other Charges Recovery Fee” of 99 cents on all accounts, and then Federal and Local taxes are calculated with that included. This means that my Federal Tax rate was 60% (6 cents) and Local Tax was 100% (10 cents), and their “Other” fees were a massive 990% of my actual charges.
But don’t think for a second that all these fees go on to the government. Only the Federal and Local taxes are passed on. The other fees are kept by the telco. You see, they charge us for things they have to pay, as a “cost of doing business” fee. Yes, the government charges them various fees, but instead of paying them out of their pockets, they pass these fees on to us.
But I will admit that on a percentage basis the numbers are huge, but total dollars are small. So let’s look instead at the regular phone bill. I pulled the latest bill for our office phone service which is a lot more expensive, so the taxes and surcharges should be minimal, right? How does a total tax and surcharge rate of 52% grab you? Yes, that is right. We paid 34% extra in “Surcharges” and 18% in “Taxes”. The biggest single line item is the ever mysterious “FCC Line Charge” of over $7.50 per line.
No wonder they are making billions in profit. We’re paying their expenses. Maybe the next surcharge will be the “Ed Whitacre Golden Parachute Fund.”
Net Neutrality: Oligopoly and Stagnation
Filed under: Internet Strategy – August 04, 2006
There is a great article in the latest Technology Review that looks at the current Net Neutrality debate by examining the past. You can look at recent history, such as the cell phone networks of today, or go further back and look at what happened with Western Union and the Telegraph industry.
I would think that we all know how open the cell phone networks are today because we see so much innovation and new service popping up. And I’m sure you have been able to take your cell phone from one company to the next and have it operate flawlessly, right? Read this article on NewsForge from a cell phone technology insider and see how easy it is to work with them and innovate. Want a hint of the future of the Internet?
So why aren’t there a wealth of amazing and interactive services available for mobile devices? Why is there no MySpace, Craigslist, Amazon, Flikr, or eBay accessible through this network? Why are cell phone payment systems and email systems nearly nonexistent? Why haven’t charities raised money or awareness of their causes through this system?
It’s simple. Because the cell phone carriers control what services are allowed to use their networks. There is no net neutrality on the cell phone network.
And what about the Telegraph? Western Union expanded the network by buying rivals and focusing on business customers, and squashing innovation that could have brought the service to the masses.
We have all read how the Telcos need this tiered system so that they will have the incentive to innovate. But innovation is not what it used to be. Back in the day when nobody could put any device on a phone that was not approved by AT&T;, at least AT&T; had their Bell Labs that came out with great stuff, even if they were not for the telephone. But what about today? Telcos spend far less money on research and development than the computer and Internet industries, and according to the article, Telcos spend more money lobbying than they do on innovation.
I’ll leave you with a quote from the cell phone technologist:
It doesn’t take much imagination to imagine Verizon treating their Internet property just like their cell phone network — short-sightedly milking it for all it’s worth, at great expense to the public, and to the future.
Media Guard – Blocks Bad Ad Viruses, Trojans, and ActiveX
Filed under: Online Advertising – August 07, 2006
Right Media today announced the release of their new Media Guard system which will prevent harmful applications from being spread through online advertising.
From their press release:
Media Guard was designed to block advertisements that contain viruses, trojans, initiation of Active X and exit pop-ups. During its initial test phase in July 2006, Media Guard scanned over 50,000 creatives 5 million times worldwide and discovered 17 different types of hidden viruses. To add an extra measure of protection and control for publishers, a manual review applies uniform standards to creatives by using over 160 attributes and classifications arranged categorically.
This is a great development, but it does seem as if their press release gets one thing wrong.
The subhead for the release says:
Media Guardâ„¢ System Addresses Long-Standing Industry Need to Protect Publishers from Ads Containing Inappropriate and Harmful Content
While this is all well and good, whoever said that publishers need protection? Maybe because they are a network they missed the real beneficiary – the public!
Someone Just Got 1 Billion Dollars
Filed under: Search Engine Marketing – August 07, 2006
Sorry to continue piggybacking on Jim’s headline, but this one is for real. The Wall Street Journal just broke the news that Google has agreed to pay News Corp. at least $900 million for the exclusive rights to search and text based ads on MySpace and other sites. This makes $2 billion that Google has allocated to dominate the search and ad markets (the prior $1 billion to AOL) and stake out claims. They are doing their best to box out Yahoo! and MSN.
If Only John Wanamaker Lived Today
Filed under: Online Advertising – August 09, 2006
AdAge just reviewed a new book (to be released next month) that declares that John Wanamaker’s adage is not longer true. Only 37.3% of all advertising is wasted. The book, “What Sticks: Why Most Advertising Fails and How to Guarantee Yours Succeeds,” tracks a billion dollars in spending by 36 top advertisers.
Now, I have to admit that I have not read the book yet (they didn’t deign to send me an advance copy for review), but the review sure makes it sound like the ad industry is in trouble and they need lots of work and analysis to turn this around. The author even apologizes to prior clients in the book. A quote from the author is telling
I spent the first decade of my career as an agency media guy. I felt like a charlatan the entire time. … I knew in my heart of hearts that we collectively, not just Greg Stuart, did not know what we were doing in spending clients’ money.
The review even points out that marketers set up campaigns without clear goals.
Of the 36 marketers the authors researched, only two — P&G; and Cingular — had a clear definition of success for each marketing effort at the outset, Mr. Briggs said in an interview.
As the old joke goes, “I can see your problem right here…” All you have to do is look at the ad spend data and you can see that it is not even projected to be 9% of all ad spending until 2011. If the ad industry wants to wake up and actually be a part of the ROI calculation, they need to look at the media that is accountable and trackable, where you know very quickly when you are wasting your ad dollars. Online advertising is not rocket science and virtually all campaigns are tracked to some degree, and many are updated and adjusted real time to improve performance.
If Wanamaker were alive today, he’d be spending half of his money online and he would know which half was being wasted…
Google Now Shows Search History
Filed under: Search Engine Marketing – September 08, 2006
Google today seems to have released a new feature when viewing organic search results for users who have Google accounts and are logged in. If you have a Google account (you get one is you use any Google services, including Gmail) then all you have to do is sign in and start searching. Any site that you have visited by following links on the Google organic search results while logged in should have a very basic history that it will show you in the search results listings.
While this is new, I have seen sites listed showing “2 visits – Jul 6”, and other sites that I have visited recently and often showing no recent visit activity. I even tested this out before signing in and my activity was not tracked there. Even though I had visited one site from the search link a few times before logging in, the result only had the time of the one visit I made after logging in, and said nothing about multiple visits. But other sites had data telling me the number of visits.
Looking at sites I visited today, there is no record in the organic listings of a visit, yet the links are marking the sites as visited, and Google Desktop knows about the visits.
Once you are logged into your Google account, it is very easy for them to track (via cookie or account data) where you go. I also have Google desktop installed, and that tracks my history. But I would think it would be showing a lot more visits and for more sites if it used the desktop data. My guess from the small sample I have is that they are using the tracking codes when you click on search results and associating them with your account and storing that information on their servers.
I would think that they are doing this to make it easier for you to know if you have followed a search link before, and even how often. I’m sure privacy advocates will find something to complain about here, but since this only happens when you are signed into your Google account, all you have to do is not sign in to prevent this tracking.
Feds Continue to Target Gambling CEOs – Sportingbet’s Dicks Arrested
Filed under: Affiliate Marketing – September 08, 2006
US attacks on Gambling continued Wednesday with the arrest of the chairman of Sportingbet, Peter Dicks upon his arrival at Kennedy Airport, acting on a warrant issued by the state police in Louisiana. This follows the arrest of BetOnSports CEO David Carruthers as I reported here back in July. Back then many thought it appeared as if they were going after BetOnSports specifically and not the industry in general.
I have said it before that the US seems to be ramping up it’s intensity with regard to online gambling, and this is just the next step in what I expect to be an escalation of arrests and indictments. The notable fact here is that it was the state of Louisiana, not the federal government that took action. This might also be a loophole that get Dicks off. State laws differ from federal laws, and with Internet gambling taking place across state (and country) lines, there may be a jurisdictional argument.
That said, I would not plan on visiting the US if I were an executive of an Online Gambling company.
ClickZ Notices Affiliate Marketing
Filed under: Affiliate Marketing – September 28, 2006
It was nice to see an article in ClickZ from Heidi Cohen on the benefits of affiliate marketing. What is extra interesting about this is that Heidi normally writes about “Actionable Analysis”, where she normally covers ways of measuring what you do online. This area has had articles more recently on content strategy, email marketing and analysis, analytics, and more.
It was great to have her include affiliate marketing here, as we have been touting the value of this channel based on the measurability and metrics of this area. This was not a puff piece either, as it went into detail on marketing strategies. She talked about setting limits and monitoring affiliates – including defining what they can do with paid search. She also advised a tiered system of affiliates and personal contact:
Personal contact, tailored marketing support, collateral, and on-site merchandising can help drive visitors sent from affiliates to convert better. Many marketers overlook the importance of courting their second-tier affiliates. Since there’s always turnover, you must keep grooming new affiliates with the potential to grow significantly.
Of course she goes into detail on metrics as well, as this is her area, and she does not miss some of the pitfalls. She even goes into detail on how to stratify affiliates and measure turnover rate. She also warns to consider the impact of the program on margin due to channel conflicts.
All in all, a good top level article. Maybe with some prodding she might want to write in more detail on some of the analytics areas and how they can help with the conflicts?
Update – New York Dismisses Warrant for Sportingbet Officer
Filed under: Internet Strategy – September 29, 2006
Reuters is reporting that the arrest warrant for Peter Dicks that I reported on earlier, former chairman of Sportingbet, has been dismissed by a judge. The warrant was based on a “gambling by computer” charge filed in Louisiana.
It is hard to say of this is a break in the attacks on Internet gambling, or just a conflict between two states. The report mentions that New York State Governor George Pataki refused to sign the extradition order to send Dicks to Louisiana to face the charges against him. I don’t follow East Coast politics closely enough to read between the lines, but I would not be surprised if there is as much politics going on here as there is legal wrangling over online gaming.
Is Google a Moron?
Filed under: Internet Strategy – October 06, 2006
I have heard from two sources that Google in in talks with YouTube and the price is $1.6B, I guess that answers Mark Cuban. Obviously Google has the deep pockets and is already embrioled in numerous trademark issues, so this actually makes some sense.
Pixels are Back Again – Will Lightning Strike Twice?
Filed under: Online Advertising – December 05, 2006
Alex Tew of the MillionDollarHomepage has launched his next big idea, Pixelotto. Instead of $1 per pixel for ad space that people forget about, this new twist has advertisers paying twice the old amount, but adds incentive for players to click on ads by offering a winner $1 million once all the ads are sold.
To win, you just have to sign up and click up to 10 ads per day. I assume each click (up to 10 per day) counts as an entry. He says that once all ad space is sold, he will wait a month and then choose a winning ad space. The winner will be chosen from everyone who has clicked on that ad.
To make you feel better, he adds that the winner gets to nominate a charity to receive $100K. Just in case the advertising does not sell, the winner gets half the sold ad revenue and the charity 10%.
I really want to be critical and call this a scam that will fail, but with Alex’s track record and many happy advertisers from the first time, he is already doing well. The total is already over $90,000, and I have seen the number move today while writing this post!
Graphical Map of the Internet for Nerds
Filed under: Internet Strategy – December 12, 2006
I really can’t say why I like this map, but it just hit a good spot in my brain. Click the map for the full size image.
Verizon Reps Can’t Do Math
Filed under: Customer Service – December 19, 2006
Do you know the difference between a dollar and a penny? If so, go to the head of the class and let the Verizon reps stay behind. There is an amazing 27 minute long audio clip (below) from a blogger named George Vaccaro who ran into a bit of trouble with his Verizon bill. He was going to travel to Canada and wanted to know how much using his data service would cost. He was quoted .002 cents per kilobyte and had the operator note this in his record.
When he returned from Canada he found that he had been billed $71.79 for 35,893 kilobytes of usage. This works out to .002 dollars per kilobyte, a significant difference. Listen to the audio clip below as he tries in vain over and over to many different operators to explain that there is a difference between .002 cents and .002 dollars.
This call was made December 7th, and it was finally resolved for him by December 10th. One blog reader has been going through the same hassle. Others have found evidence of this same thing and there are even recordings made on December 14th that show that the reps still have not had a memo sent out explaining that their documentation is in dollars and that there is indeed a difference between fractional dollars and fractional cents.
Now Microsoft Thinks It Invented RSS?
Filed under: Internet Strategy – December 21, 2006
It was just revealed (after the 18 month “secrecy” period expired) that Microsoft has filed for two patents (here and here) covering Web feeds – specifically mentioning RSS. I know Microsoft is famous for taking other’s technology and making it their own, but actually going off and patenting it is a step beyond what they normally do.
It sure looks like they are claiming to have invented the feed reader in claim 1 of the ‘329 patent:
1. A system comprising: one or more computer-readable media; computer-readable instructions on the one or more computer-readable media which, when executed, implement: an RSS platform that is configured to receive and process RSS data in one or more formats; and code means configured to enable different types of applications to access RSS data that has been received and processed by the RSS platform.
Followed by Claim 10 where they seem to have invented the reader:
10. A system comprising: one or more computer-readable media; a set of APIs embodied on the computer-readable media, the set of APIs comprising one or more methods that enable at least one application to access RSS data that has been processed and stored in a feed store; and wherein said at least one application does not understand an RSS format in which the RSS data was originally embodied.
The ‘011 application covers “Finding and consuming web subscriptions in a web browser ” where
a user can subscribe to a particular web feed, be provided with a user interface that contains distinct indicia to identify new feeds, and can efficiently consume or read RSS feeds using both an RSS reader and a web browser.
Dave Winer has already commented on this. For those of you who don’t know, he is acknowledged as the one who is pretty much the father of RSS.
In my brief reading of this, it sure looks like they are not only late to the party, but have amazingly broad claims. Maybe they are doing this to get most of it thrown out and still have something left over.