Can print companies grab a significant share of programmatic advertising simply by buying major Web operations?
Time Inc. is reportedly considering some kind of deal with Yahoo, possibly a merger. In February, Time Inc. purchased ad-targeting specialist Viant Technology, which owns MySpace, once a top Web site, now ranked 1590 in the U.S. by Alexa. CEO Joe Ripp confidently declares that Time Inc. is “no longer a magazine company,” but a “content” powerhouse.
“He needs to make a move toward digital,” observes about.com founder Scott Kurnit.
Time Inc. also showed its future direction by buying a group of YouTube content sites — oddly timed indeed, as it coincided with Yahoo shutting a bunch of similar operations down. Although MySpace claims over one-billion registered users, it has not confirmed how many are active. (Viant did not make an executive available despite repeated requests.)
“I would take that number with a grain of salt,” says an industry observer. “There is a reason why MySpace disappeared.”
Today, only a quarter of MySpace visitors are in the U.S., more than 20% come from India. Until I started work on this story, I had forgotten that I had created a MySpace profile. The Viant deal, Kurnit adds, “was about the third-party data,” not MySpace.
Let’s put this in perspective. Twenty years ago, Time Inc. was not just a magazine company, it was the pre-eminent print powerhouse, responsible for a third of all consumer magazine advertising. Because it owns weeklies, it still grabs about a quarter of all consumer magazine ads.
Time Inc. publishers had a pedigree: usually Ivy League graduates who lived and golfed in Greenwich. But then the Internet exploded, and Time Inc.’s travails then, especially its Pathfinder and AOL debacles, have been well chronicled, including in a book I wrote.
Time Inc. was spun off from Time Warner primarily because falling print ad revenues were hurting the overall company’s bottom line. The company suffered a 10% drop in print ad revenue last year, and digital advertising is expected to overtake print ads by 2019. So a combination of Time’s brands, Viant’s ad-targeting “cloud” and possibly Yahoo’s core business and market share will give Time a preeminent position in the $9-billion programmatic advertising space?
Keep in mind that the Top 10 Internet companies attract almost 70% of programmatic ads now. In other words, only by merging with Yahoo or some other big player could Time Inc. hope to compete in the burgeoning programmatic advertising future with anything like the major scale it once enjoyed.
While other print companies, such as Condé Nast, take baby steps like hiring programmatic ad specialists, Time Inc., accustomed to a leadership role, wants to be a digital player on a major scale. But even Google doesn’t dominate digital advertising the way Time Inc. has print, so acquiring anything like its former status seems a long shot for Time Inc.
And there’s still the memory of that AOL deal.