DataXu launched Tuesday what CEO Mike Baker calls the next generation of demand side platform (DSP) technology that lets advertisers measure, buy, and optimize ad placements across online, video and mobile display channels in real-time, impression by impression. The platform -- DX2, which added mobile and video -- makes more than one million media decisions in a second to deliver advertisers deeper consumer insights and media control. It's about understanding consumer behavior and recognizing patterns through three screens. The technology also features pull technology rather than push. Baker -- who sold Enpocket, a mobile ad platform, to Nokia in 2007, allowing it to build an advertising network -- believes mobile and video will create the next wave of efficiencies for advertisers. He says the first generation of DSPs approached the bid world as if they were paid-click optimization engines from search engine optimization (SEO) companies, relying on cookies to serve up the ads. DSPs have become known as the disruptive intermediaries, but as online advertising moves deeper into technology it will take technologists, or techarketers, rather than traditional marketers, to support online advertising through automation and data gathering. DX2 makes decisions with data beyond cookies in real-time such as time of day, geographic location, day of the week and other data that reveal performance patterns. "The industry relies on cookies, cookies and more cookies, as if browser cookies define the limits of intelligent decisioning," Baker says. "We look at all the data related to ad placement, including cookies, but also page content and creative perimeters that correlate to conversions." The back-end platform that allows DX2 to provide precise ad placement looks a lot like Google, according to Baker. Through Apache Hadoop, an open-source parallel processing technology, and commodity hardware, DataXu crunches ad and Web data for advertisers looking for statistical probabilities. The data is processed daily for 30 days. DX2 manages multichannel campaigns with access to more than 100 billion auction media impressions across online display, mobile and video channels. The platform integrates with Nexage and Mobclix for mobile inventory, and adap.tv and BrightRoll for video inventory. Mobile and video beta programs will run through 2010. The platform offers a real-time survey tool in partnership with Vizu that identifies the creatives, the consumers and the content that produces the best brand lift. Baker claims the platform dramatically lowers the cost of ownership because advertisers don't need to purchase as much data. A recent DataXu MarketPlus company newsletter digs into the cost of media associated with these new tactics. The chart shows cost on a CPM basis for Optimized "Run-of-Exchange," Audience Targeting and Retargeting indexed to Run-of-Exchange cost. The tremendous amounts of data are filtered through machine learning technology. Baker says DataXu's team -- literally a group of Massachusetts Institute of Technology (MIT) rocket scientists -- filters information from data, turning the info into insights and actionable. The data is not achieved.
Toyota is launching a Web series as part of its AutoBiography social media campaign to promote Camry and Corolla. The new video series running on Break Media's network of sites features standup comics doing monologues about their first cars. The new video series, "Standup Stories," has six comedians riffing on the theme. The videos have the comics performing in front of a live audience of some 75 people at Hollywood's Improv comedy club. The first video went live on Monday, with new routines rolling out in coming weeks. The videos are both at Break.com/toyota and on Toyota's AutoBiography Facebook page. Break was also involved in Toyota's "swagger wagon" effort for the new Sienna minivan. Kim Kyaw, Toyota's media strategist, says the effort is intended to get more guys engaged. "A lot of the content has tended to resonate with a female demographic. The comedy angle gave us something for men to enjoy as well. She points out that Break Media's network of sites reaches more than 100 million men 18 to 34 years of age each month. She says Toyota is piggy-backing on the network. "Break Media provided recommendations of comedians and we chose from those." She says the comedians were given creative direction. The AutoBiography program, which started in June and runs through November, has included broadcast, print and digital advertising. "So far, we are doing very well," says Kyaw. "We have gotten over 8,000 stories," she says.
The Association of National Advertisers (ANA) is joining a roster of groups urging the Supreme Court to support a lower court that judged unconstitutional legislation in California restricting violent images and speech. The U.S. Supreme Court in Schwarzenegger v. Entertainment Merchants Association, No. 08-1448, is reviewing a decision by the 9th Circuit Court of Appeals, which said a California law aimed principally at video-game publishers violates the First Amendment. Arguments begin Nov. 2. California says states should be able to regulate any material that its legislature deems likely to harm the ethical or moral development of minors, and that states should be able to deny minors direct access to material protected by the First Amendment as long as parents do not choose to provide such items to their minor children. Broadly, the ANA argues that the proposals are content-based, subjective in application and potentially vast in scope, and "antithetical to First Amendment values." The ANA is joined in the amicus brief by a diverse group, including the American Booksellers Foundation for Free Expression, the Association of American Publishers, the Freedom to Read Foundation, the National Association of Recording Merchandisers, the Recording Industry Association of America, the Amusement & Music Operators Association, PEN Center USA and the Recording Academy. The industry brief argues that among other things, legal precedent should direct the court to support the Ninth Circuit's decision. The group argues that since the court has not heretofore recognized exceptions to the protections of the First Amendment for violent content, it should not do so now. "Contrary to the contention of the State of California, this court has consistently and properly declined to make exceptions to the protections of the First Amendment for visual depictions or textual descriptions of violence," says the brief. "Such descriptions and depictions, both fictional and real, have always been a part of our civilization's art, history and literature, both for children and for adults." The brief says a long aesthetic history of violence supports the point. The 53-page novella-like brief's examples range from Homer ("Menelaus hacked Pisander between the eyes, the bridge of the nose, and bone cracked, blood sprayed and both eyes dropped at his feet to mix in the dust") to the Brothers Grimm fairy tales and Tom and Jerry cartoons ("Tom and Jerry spend short after short physically attacking each other.") Dan Jaffe, ANA executive vice president, said in a statement that while he agrees children should be protected from inappropriate material, "The California law is far too sweeping and clearly violates the First Amendment. We joined in this brief to respond to the growing effort of policymakers across the country to 'childproof' ever widening categories of speech in our society." Jaffe argues that the high court has, in the past, asserted that regulations restricting speech that is lawful for adults can't be unbridled simply because they are intended to protect children. "Also, treating older teenagers up to the age of 18 as if they were very young children is constitutionally suspect," he said. Jaffe doesn't miss the obvious chance to reflect on the Terminator's own career: "It is ironic that this case is being pursued by California Gov. [Arnold] Schwarzenegger, whose career was propelled by a series of movies that contained substantial violent content and which spawned video games based on them." "The Terminator is determined," says Jaffe, who adds that the regulations follow a trend toward raising the age of childhood and restricting a broader range of advertising and products because of their potential to be marketed to children. "It's the whole idea of putting kids in some sort of chrysalis, or hermetically sealed container until they are 'fully mature' at some magic date." On Monday, the ANA, the American Association of Advertising Agencies (4As) and the American Advertising Federation (AAF), filed a brief calling on the U.S. Supreme Court to review another case involving restrictions on alcohol beverage advertising in university publications. In that case, the U.S. Court of Appeals for the Fourth Circuit said a new Virginia law that bans the advertisement of alcohol beverage products in publications directed to a primarily student audience was constitutional. The court based its holding on the fact that a portion of the readership is under legal drinking age and the state has an interest in preventing underage drinking. "What's happening in the food area is that they are saying a range of foods can't be advertised because the audience is under 18. The violence issue is only a piece of it. It's not only trying to raise the age at which one can be treated as a child, but the number of categories." Jaffe predicts that if the Court takes the case, odds are they will rule in favor. "I think the odds are they will continue to uphold these kinds of First Amendment protections as they have in the past. But there are two new members who have not spoken out in these issues and whenever you go to the Supreme Court it's a situation where you have to cross your fingers."
Over the weekend, on the eve of the new broadcast TV season, NBC's "Sunday Night Football" and a kid named Fred on Nickelodeon scored big TV results. "Sunday Night Football" featured a game highlighting the brothers Manning -- Peyton and Eli of the Indianapolis Colts and New York Giants, respectively. It posted the fifth-best results ever for the NBC NFL series, a Nielsen preliminary 8.0 rating/21 share among 18-49 viewers. The game was also 3% higher than the only other time the two brothers/ NFL stars met in a regular-season football game. The best "SNF" numbers ever came with the Sept. 9 game between the Minnesota Vikings and New Orleans Saints. The Colts' 38-14 victory over the Giants came against virtually zero competition -- reruns and one original episode, that of ABC's season finale 10 p.m. drama "The Gates," which ended with a 0.9/2. During the 8 p.m. to 8:30 p.m. half hour, a combination of CBS' "60 Minutes" and a rerun of "Undercover Boss" posted a second-best 2.7/7. After that came a trio of Fox's "Family Guy" reruns between 8:30 p.m. and 10 p.m., with episodes earning a 2.4/6, 2.4/6 and a 2.5/6, respectively. During the 9 p.m to 9:30 p.m. half-hour, "Undercover Boss" also posted a 2.4/6. NBC had a 6.7/18 overall on the night in the key 18-49 viewer group; CBS, was well behind that at 3.5/10; Fox, at 2.0/5; ABC, at 1.1/3; and Univision at 1.0/3. On Saturday night, Internet video character Fred Figgelhorn, transformed to TV stardom, rocketed Nickelodeon's "Fred: The Movie" to a big-time 7.6 million total viewers -- easily making it cable TV's biggest movie of the season so far. The kids' cable network scored large numbers among its core audience -- 3.3 million kids 6-11; 3.1 million Tweens 9-14; and 4.0 million kids 2-11. In addition, Nickelodeon says Fred videos generated 1.8 million streams on Nick.com.
The majority of mobile entertainment devices used by parents and kids host less than 20 apps geared toward children, but about 7% host more than 60 apps for a child, according to The NPD Group Kids' Mobile Entertainment & Apps study released Monday. Gaming is the most popular type of app downloaded, with the average mobile device used by a child containing approximately 10 game-related apps. Music ranked No. 2. When it comes to overall downloads, however, music dominates and games moves to the No. 2 spot. Video steps in at No. 3. Music makes up more than half of all downloads and about 61% of all child-related downloads to a mobile entertainment device. The remaining types of downloads, including ringtones, TV shows and movies, comprise less than 10% of all downloading activity. Three top themes emerged in the study that keep kids coming back for more, and parents agreeing to allow the kids to download, listen to music and play games. Anita Frazier, industry analyst at The NPD Group, says these themes include the love of music, laughter to keep kids entertained, and fun and addicting applications. "Parents are more willing to pay for apps when they think their kids will use them a lot," she says. Connecting with friends through social elements also attracts kids. "We all know you're supposed to be 13 and over to use Facebook, but all of us know plenty of kids under that age with Facebook accounts," she says. "The social aspects are appealing to many kids." The ability to download content or listen to music at no charge continues to entice consumers, especially kids. Seventy-five percent of respondents say free is the highest motivating factor driving app downloads. Other motivators include recommendations by family and friends, the request from the child for the app, and the app's affiliation with a character or personality. About 82% of all apps downloaded for children are free. Those who purchase apps for children say they're willing to spend almost twice as much as they do. And the willingness to spend more rises as the child increases in age. Despite some prevailing notions that many apps are used once and then deleted or forgotten, most kids will reuse the same app many times. Only about 1% reported abandoning apps after one use. A child might spend on average slightly more than 20 minutes at a time, but this varies by gender and age, Frazier says. Most kids use the app multiple times, rather than just once, or only a few times, Frazier says. "Parents told us their kids are using the apps 'over and over,'" she says. Frazier says the study didn't measure whether the parent became a motivating factor to the child downloading and using the app, but NPD found that apps downloaded to devices owned by the child created more motivation compared with those downloaded to parent-owned devices. "For devices owned by the parent, but that the child uses, 'it's educational' became a much more motivating factor" when trying to sell the kid on the application, Frazier says. Friends and family recommendations also help to motivate the child into using the application. Final data includes 1,043 completed surveys from parents who have kids 0 to age 14 using either iPhone, iPod touch, iPad, BlackBerry or another smartphone. The survey was conducted between June 18 and July 28, 2010.
In his Archive of American Television interview back in 1997, Hugh Downs, who got his start in radio, said this of TV's first years: "I thought it was a gimmick like 3-D movies and it would just go away... I saw in a relatively short time that it was here to stay, and that I'd better move toward participating in it." There is a similar conflict happening now between the established medium of television and original Web content. Transitioning himself from radio to TV in the 1940s was the right thing to do at the right time for Downs, even when the audiences and sponsorship dollars were not yet there. Which brings us to today: Where are we in the transition to new media? When you see the numbers of teens and 20-somethings forsaking traditional TV for online video exclusively, it seems as if we should be seconds away from hordes of smart, successful TV people making lots of money creating broadband content. But we're not there yet. When television launched in the late 1940s, most movie studios forbade (yes forbade!) their talent from appearing on TV. For years, movie stars and even fans thought of TV people as B-list celebrities. Slowly, a few TV-only stars and shows made it above the fray, and they're still household names today. Yet, sorry to say, the Internet has yet to spawn a true A-list celebrity who's not a cat. Why? Because true Internet content creation, complete with storytelling, is still a second-class citizen. Worst of all, the minute anything viable shows up on the Internet, TV still has the money to lure the wayward child back to the mothership. TV people have been reluctant to do Internet-only work if there's a broadcast job to be had. Many TV stars do extras to promote their broadcast shows, but moving exclusively to Web distribution is still considered a step down. It's no surprise that something similar happened in the radio-to-TV transition: radio stars, big deals back then, sometimes allowed their shows to be simulcast on television -- but didn't turn off the radio mike until they knew TV was stable. Those who didn't make the move at all are forgotten. There are some TV people who bravely dipped their toes into the broadband world: Will Ferrell, Marshall Herskovitz and Ed Zwick, and Lisa Kudrow, to name a few. The water must have been really cold (or unprofitable), because Kudrow's show "Web Therapy," which launched as a Web series, was recently picked up by Showtime for airing on good old-fashioned cable TV. The same happened with Herskovitz and Zwick's "Quarterlife," which found itself as a short-lived series on NBC. A TV deal is still considered trading up, even if the aggregate numbers of viewers and anytime access (to a younger audience, at that) are potentially better on the Web. Things will change as the content matures and everyone figures out how to monetize all this (just like they did on TV). Early TV programming is not so different from today's Internet hits. Is the Web series "The Annoying Orange"(with 64 million views) that different from 1949's mildly subversive "Time for Beany?" Is "Fred" (with 21 million views) that far away from 1954's "The Pinky Lee Show"? If TV history is any indication, a "Golden Age" comes next for original Web video. In the '50s and '60s, well-written long-form live TV dramas as well as comedy hits like "I Love Lucy" changed the way America consumed media (and helped end movie studios' media domination). Eventually, content creators will develop long-form programming using interactivity to tell stories in new ways. Maybe we'll see fewer 3-minute one-joke videos and more 12-minute masterpieces. And of course, no one will complain if a same-day Old Spice ad pops up to cover the costs.
In the past, we've looked at how YouTube can generate more revenue and what Facebook can expect as it wades increasingly into online video. Today, we'll look at Yahoo in the context of the rumor that the Sunnyvale-based company is gunning for 1 billion users and $10 billion in annual revenues within three years, or 2014. With 622 million users and 2009 revenues of $6.5 billion, Yahoo will have its work cut out for itself. While it can accelerate its march to 1 billion users through acquisitions, the road to $10 billion in revenues will no doubt have to come through video advertising. Yahoo is no stranger to online video: its video portal at video.yahoo.com is a top 10 video destination. It downright invented Media RSS (MRSS), which is the backbone of most video syndication and discovery today, and was obviously ahead of the curve with the purchase of Broadcast.com back in the day (way back). Being ahead of the curve isn't always a good thing. The action is ahead of us now. In the U.S., online video advertising was a $1 billion industry in 2009, according to eMarketer. The number will grow 49% this year, and should hit $5.5 billion in 2014. That's just in the U.S.; double that amount to guesstimate global figures: so by 2014, global online video advertising will represent a $10 billion industry. If Yahoo is serious about hitting its rumored target, then it needs to first reverse the revenue slide it experienced from 2008 to 2009: from $7.2 billion in 2008 to $6.5 billion in 2009. But as everyone knows, the wheels came off the economy in the tall of 2008 and the first half of 2009 was slow, even for online media. However, as things stabilized and the advertising dollars came back, online won more battles than it lost -- and online video in particular outgrew everything else including search and social media. Without a doubt, search continues to garner the lion's share of online ad dollars, and Facebook's explosive growth has allowed it to galvanize its share of social networking ad dollars, but the fight for online video ad dollars remains wide open despite YouTube's stranglehold of video views in the U.S., with 43.1%, according to comScore. Who Can Really Take on YouTube? By now, everyone knows YouTube's challenges: - Overreliance on user-generated content - Facing advertisers' aversions - Hesitance of traditional media companies to license their content with YouTube - And frankly, the fact that while YouTube in aggregate generates the most views and outdraws its competitors, it is challenging to drive a lot of views for a given video due to the sheer clutter on the site. This is where Yahoo can pose a considerable challenge to YouTube -- if it weren't content to remain on auto-pilot instead of shifting out of cruise control. Yahoo has relationships with practically every advertiser in the world -- but more important, Yahoo remains the world's No. 1 portal. Outside the echo chamber, that has a lot of value and traction. Largest Video Sites Will be Aggregators By now we see that aggregators will become the dominant video sites when measured in traffic. But the reality is that the vast majority of these aggregators will be challenged on revenue and profits. In fact, many aggregators will also have their share of UGC and pirated content, meaning that their monetization will be slow and arduous. Yahoo is somewhat immune to that. It owns 1) distribution; and has the 2) monetization down pat. When it comes to 3) content, Yahoo has been both an aggregator and creator of content. It licensed articles (usually for 30 days, which hurts its SEO mojo) and over time began to dive increasingly into original content. With video, it has created a number of series and has licensing deals with numerous companies. Content licensing costs are analogous to traffic acquisition costs (TACs) in search: they reduce profit margins. Where things differ is that Yahoo can avoid these by creating videos in-house, which explains why more and more companies are betting on content, from Break Media to AOL. But before it worries too much about profit margins, Yahoo needs a game plan to ramp up revenues, and that is where online video comes in. It is obviously too early to tell what Yahoo intends on doing, but any way you dice it, for Yahoo to hit 10 billion in annual revenues within three years, it will have to get far more serious about video.