Tech publishers and bloggers are buzzing about the impending release of a new version of Microsoft's popular Internet Explorer browser - still the dominant tool used to access the Web - that has new privacy features that could more readily delete the browsing history and cookies of individual Internet users, making it more difficult for advertisers and publishers to track and serve ads to them. Consumer privacy experts are hailing the forthcoming release of Microsoft's Internet Explorer 8 (IE8), and its so-called "InPrivate" blocking feature, but industry analysts say it could be an anathema for targeting and serving online ads. While the IE8 feature was not specifically designed to be an advertising blocker, it is expected to have that effect for certain forms of online advertising that depend on pixel tracking, because IE8's InPrivate application can block tracking pixels, cookies or pieces of code that enable third-party sites to identify and track individual browsers as they surf from site to site. News of the IE8 ad blocking threat comes as Microsoft rival Mozilla is preparing the release of a new version of its equally popular Firefox browser. Mozilla dubbed its new feature a "private browsing" tool, and said it would offer users greater flexibility in terms of how they adjust their privacy settings, but the effect could be the same as Microsoft's IE8 privacy features. Mozilla is planning its release for later this year or in early 2009.
Continuing its efforts to establish a thriving reseller market for rich media, content distribution network Highwinds Network Group today is expected to announce new partnerships with four firms, including VirtuPoint, i5labs, One Pica and 9mmedia. Highwinds operates a content delivery infrastructure dubbed RollingThunder, which allows clients to quickly access high-bandwidth content such as animation, streaming audio and video. More recently, Highwinds has branched out into the rich media design market, as an increasing number of marketing agencies have taken part in the reselling of Highwinds' content delivery services to their own customers. In addition to offering direct access to their CDN technologies, Highwinds' lets its channel partners control their own billing and pricing structures, and provision new customer accounts quickly. "We started to see some trends, which we thought would support a resellers market," said Mark Hayes, vice president of marketing and business development for Highwinds. "The common thread we saw among rich media design companies was their ability to call the shots when it comes to their own customers." To support its growth in this around, Highwinds in March closed a round of financing worth $55 million, which was led by General Catalyst Partners and Alta Communications. Still, Hayes claims that Highwinds is already profitable, which is all the more surprising considering the modest size and budgets of its reseller partners. "We have struck big deals, like Technicolor, but many of these resellers are somewhat small," Hayes said. In July, Highwinds and Technicolor, the services division of Thomson, signed a major partnership agreement under which Highwinds' RollingThunder content delivery network is providing content delivery, real-time analytics and advanced capabilities for Technicolor's digital content distribution. "Many of these deals might be worth $5,000 or $10,000 a month, but they add up," Hayes said. Jason Wong, CEO of i5labs, said the Web application development firm is using the Highwinds CDN as a secondary revenue stream for the company. "We are private-labeling the CDN and StrikeTracker as 'i5labs CDN by Highwinds,' and customers are responding well to it," he said. Meanwhile, in an effort to expand its client base and maximize revenue streams, VirtuPoint, a rich media development firm, is presently using the Highwinds CDN for the broadcast of live events, on-demand video and static content distribution to deliver client data.
News of Google's potential mobile search deal with Verizon Wireless comes as no surprise to analysts who monitor the mobile search and advertising space. In fact, according to Mike Boland, senior analyst at The Kelsey Group, the deal is indicative of a huge shift in the way that mobile service carriers are starting to view technology companies, paved in part by AT&T's groundbreaking deal with Apple for the iPhone. "Apple broke that barrier between the service carriers and technology companies," Boland said. "The entire mobile industry saw the benefits of letting a tech company come in and do what they do best, which is the hardware and software. And now we've seen this domino effect, with iPhone-driven query volume picking up for Google and iPhone-based traffic surges to other sites. So AT&T's competitors see that they need to partner to take advantage of increased data consumption, as well as mobile search advertising." Still, the possible partnership between Verizon and Google could be described as a truce between "frienemies." The two giants have clashed in the press and on Capitol Hill, with regard to the terms of the FCC's auction of the 700 MHz wireless spectrum in January, as well as about broadband traffic throttling and net neutrality. The deal would essentially make Google search the "on deck" option on Verizon mobile devices, and they would split any ensuing ad revenue. It would come as a welcome change, according to subscribers like Larry Dignan, executive editor of ZDNet. "To say the Verizon Wireless default search experience is messy is an understatement," Dignan wrote, in a blog post about the deal rumors. "I'm a Verizon Wireless customer and I get bounced all over the place depending on whatever deal the carrier cut." Boland says that subscribers exposed to the iPhone's smooth, streamlined search and browsing interface are increasingly unwilling to pay for poorer mobile experiences, and carriers are under the gun to partner with tech providers as a result. "Apple created a catalyst with the iPhone, and now there's no going back," Boland said. "Companies like Verizon are almost forced to find partnerships for competitive reasons. They'd probably rather go back to the way it used to be, where they had all the control, but new standards have been set in the marketplace." Greg Sterling, senior analyst & program director for Local Mobile Search agrees. "The U.S. carriers that 'open up' faster and give consumers ways to personalize their devices and gain access to the types of content they want will win, those that resist will not," he wrote, in a blog post titled "Carrier Universe Opening Up." On the other hand, the deal would be one more step in Google's push for mobile search domination. CEO Eric Schmidt mused that the search giant would eventually be able to generate more revenue from mobile advertising than desktop in a guest spot on CNBC's "Mad Money with Jim Cramer." "Over time, we will make more money from mobile advertising," Schmidt said. "The reason is because the mobile computer is more targeted. Think about it--you carry your phone everywhere; it knows all about you." But Google faces steep competition, particularly on the international front, from Yahoo. The Web giant currently boasts mobile search and advertising partnerships with nearly 30 mobile service providers and carriers, including Telefonic in Latin America, Orange in Europe, and Reliance Communications in Asia.
Mobile search and advertising provider JumpTap has closed $26 million in fourth-round venture funding from investors led by AllianceBernstein and including General Catalyst Partners, Summerhill Venture Partners, Redpoint Ventures, Valhalla Partners and WPP. The funding will be used to expand the Cambridge, Mass.-based company's global ad sales and operations division to meet growing demand from advertisers. JumpTap says it reaches 140 million wireless subscribers through partnerships with 17 mobile operators and content providers including The Associated Press, AccuWeather.com and Superpages.com. "The closing of this round by these prestigious investors during a tight financial credit climate sends a strong and positive message about their confidence in the growth potential of mobile search and advertising and our ability to execute on our long-term vision," said Dan Olschwang, president and CEO of JumpTap, in a statement. The financing comes in the midst of a rapidly evolving mobile search market. The Wall Street Journal reported last week that Verizon Wireless and Google are close to a deal on mobile search, highlighting a shift by carriers toward alliances with the major Web search players. Sprint Nextel recently made Google the default browser on 40 of its phones, and AT&T plans to use Yahoo to power search on its Media Net portal beginning later this year. The major wireless operators have historically been reluctant to share ad revenue with the Web portals, choosing instead to work with smaller partners like JumpTap and Medio to supply search and other services. But the carriers' walled garden strategies are beginning to crumble as the mobile landscape opens up. "It does seem carriers once feared the search engines eating their lunch and now they're doing deals with them," said Greg Sterling, who leads the local mobile search practice for Opus Research. But that trend doesn't necessarily bode ill for JumpTap, which provides white-label search to carriers including Alltel Wireless and Virgin Mobile. In addition to providing specialized search for mobile content such as ringtones, the company has diversified more broadly into mobile advertising. "Their future exists more as an ad network than a search engine," said Sterling. To that end, JumpTap has recently notched ad-related deals including a partnership with Pinch Media to place ads in iPhone applications. In April, it reached an agreement to handle mobile advertising for NBC Universal and Fox, serving ads on the mobile sites of shows such as "Heroes," "The Office," and "24." "JumpTap has successfully positioned itself as the hub of the mobile advertising ecosystem and demonstrated its ability to attain its goals," said Mark Mackenzie, vice president and head of digital media venture capital investing at AllianceBernstein, in a statement. Underscoring its ambitions in mobile advertising, JumpTap in July announced the opening of its New York office at 275 Madison Avenue. WPP Group took a 2.5% stake in JumpTap in early 2007, seeking a foothold in the emerging mobile ad business.
Utah's highest state court has tossed a lawsuit accusing SmartBargains of engaging in unfair competition by displaying pop-up ads to Overstock.com visitors. "Overstock failed to show that SmartBargains' pop-ups, labeled with the SmartBargains' logo and appearing in a separate window on the top of Overstock's website, are deceptive, infringe a trademark, pass off SmartBargains' goods as those of overstock's goods, or are likely to cause confusion," according to the Utah Supreme Court in its opinion. The lawsuit dates back to 2004, when Overstock first filed a complaint against SmartBargains. Overstock alleged that SmartBargains had engaged in unfair competition, interfered with prospective business relations and violated a newly enacted Utah law banning adware companies from displaying any pop-ups that obscure ads or content on other sites. That law, the Utah Spyware Control Act, was found unconstitutional four years ago. Utah subsequently passed a revised law, but that version only bans pop-ups that violate companies' trademarks. The trial court dismissed Overstock's lawsuit, ruling that the pop-ups were not misleading and did not confuse customers. Utah's Supreme Court agreed in a ruling issued last week. The Overstock-SmartBargains dispute isn't the first time a court has considered whether pop-ups are legal. Adware company WhenU won a similar lawsuit in a federal appeals court in New York in 2005. There, 1-800 Contacts alleged that WhenU violated trademark law by serving pop-ups for Vision Direct to visitors who navigated to the 1-800 Contacts' site. The Second Circuit Court of Appeals okayed the pop-ups, ruling that they didn't violate 1-800 Contacts' trademark. Some courts have since extended that rationale to search ads, ruling that using a trademark to trigger a pay-per-click ad isn't the type of use in commerce that's covered by federal trademark law. The Second Circuit Court of Appeals is currently mulling the issue in a lawsuit brought by computer repair company Rescuecom against Google. There, Rescuecom argues that Google infringes on the company's trademark by allowing rivals to appear as sponsored results when users search for Rescuecom.
Video ringtone-sharing company Vringo today is expected to announce an agreement with Nokia to make Vringo's video ringtone application and rich media content available to Nokia device owners through the "Nokia Download" Web store. Through Nokia Download, users can get the Vringo application, then choose from Vringo's range of rich media content--including video clips, animation, avatars, slides shows, music, greetings and more--to create personalized visual or video ringtones. The application can be used on the handset or on the Vringo Web site to generate new video ringtones or select the clips they want their buddies to see when they call. The video ringtone service offers personalization tools that appeal to a younger consumers, while its community component simplifies the process of finding and sharing clips. Vringo closed a $12 million round of venture capital funding, led by equity firm Warburg Pincus, about a year ago. At present, the Nokia Download Web store is available in 17 European countries, including Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy, Netherlands, Norway, Poland, Portugal, Russian Federation, Spain, Sweden, Switzerland and the United Kingdom. "Nokia Download is the perfect tool for accessing Vringo", said Vringo CEO Jon Medved. Vringo lets users set their own visual or video ringtone and choose the video, avatar, slide show or picture they want their friends to see when they call. Users can browse Vringo's collection of content licensed from TV, video and music clips. Original Vringos can also be created by using camera phones or downloading pictures or video from existing social networks or other Web sites.
Phillips-Van Heusen's Calvin Klein division has launched an e-commerce microsite at calvinklein.com to market and sell its better white-label line of sportswear. Beginning today, the Calvin Klein Web site now allows U.S. shoppers to access products from the Calvin Klein "better" brand--with apparel and accessories developed especially for the online store as well as Calvin Klein's specialty retail stores, which started opening the stores in the U.S. late last year. Such stores are now in Atlanta, Georgia; Los Angeles and Costa Mesa, San Francisco, and Glendale, Calif.; Aventura, Fla.; Bloomfield Hills, Mich.; Natick, Mass.; Denver and Las Vegas. The site lets consumers view products from various angles, zoom in and out, change color SKUs, search by size, create and send wish lists, and search store locations. Other services include gift wrapping, free gift messages and free shipping on purchases over $200. The company says the online store will get Web ads and traditional print ad support with the Web address featured in ads. Calvin Klein will also serve up regular seasonal promotions to drive traffic. Next month, for instance, online registrants will get a chance to win a $1,000 online fall shopping spree. John Walsh, president and COO of Calvin Klein's retail chain, said in a release that the new e-commerce site--the third phase of the U.S. direct-to-consumer program after the establishment of new stores--will drive future growth, especially in the U.S. "The continued expansion of this important revenue and communication medium is central to our future growth plans and has provided the necessary platform for the development of our on-line business," he said. The Web concept for the site is via New York-based CreateTheAgency.
Interactive agencies have always been challenged to do more with less. In the fourth quarter of 2008, they will have to do much more with much less. Financial experts such as Warren Buffet are of the opinion that with the housing crisis, credit crisis and rising gas prices, the current recession will last for at least as long as the one in 2001, which lasted thirty months. What then can agencies do to ensure that their clients don't cut back on marketing? Businesses want increased returns from both branding and direct response campaigns, which are increasingly more difficult to achieve as the click-through rates on banners continue to fall, and search engine keywords become more expensive. This explains why an increasing number of online marketers are investing a portion of their media budgets against high ROI lead generation advertising. But they are not investing in just any old lead generation advertising. They are investing specifically in a specific segment of the online lead generation market-marketing leads. The marketing leads segment of online lead generation is a new category for the industry. It has transformed online lead generation from being the domain of the direct marketer to being the new and exciting tool for the brand marketer's toolbox. But just what exactly are marketing lead campaigns and how do they differ from traditional online lead generation? With marketing lead campaigns, marketers can pay only for leads -- and not for wasted impressions or clicks. But that's where the similarities with traditional online lead generation end. Traditional online lead generation advertising has been largely associated with sales leads. These are generic leads generated on the basis of demographic criteria -- age, FICO score, income, etc. On the other hand, marketing leads are brand-specific. They are unique leads generated for a particular advertiser offer. This makes them ideal for brand marketers looking to build a use base for their community sites, brand newsletter or rewards programs quickly and cost-effectively. Another key difference is that sales leads are often resold to multiple vendors. Think of the LendingTree.com model - where multiple banks compete over one lead. While these leads are ideal for sales people looking to close business through a phone call, they are not suitable for brand marketers. However, marketing leads are never resold. If a marketer from Microsoft gets a marketing lead, that lead would not be resold to an Apple marketer. Marketing lead campaigns have come into being recently as a direct result of the increased transparency in the online lead generation market. Transparency enables marketers to engage consumers in the most relevant way. For example, a consumer that has signed up from WallStreetJournal.com would receive different messaging from a consumer that has signed up from say a Rollingstone.com. How can interactive agencies use marketing leads to engage consumers? The Internet has opened a myriad number of possibilities in this regard. Look around you. Marketing is moving from an announcement oriented push strategy to a pull strategy, where the emphasis is on building engagement and conversation with customers. A New York Times article titled "The New Advertising Outlet: Your Life" quotes Nike executives as saying that much of the company's future advertising spending will take the form of services for consumers, like workout advice, online communities and local sports competitions. The Jetblue Twitter Forum, The Mercedes Benz community site, and the Starbucks Idea site are some other examples of brand marketers incorporating real-time feedback from their consumers to drive meaningful and relevant branding experiences. Even though some companies put a price tag on vehicles such as newsletters (e.g. Comcast buying Daily Candy for $125 Million), a great interactive brand medium is frankly priceless. By using marketing lead campaigns, agencies can build a qualified pipeline of leads for their clients quickly and cheaply. In addition, agencies can work off the CPL metric, which is much closer to the desired end goal (sales, repeat buys, etc) than metrics like click-throughs and Cost-per-Click that are so far removed. Finally, by using marketing leads to build branding vehicles, brand marketers can engage consumers at multiple touch points, increase brand loyalty and drive sales, making their campaigns more accountable. And there's no better rationale to provide for an increased budget. Online lead generation might not be the new kid in town. But with marketing lead campaigns, it's certainly the most changed kid in town. And it's a change that we can all believe in.