Online Ad Revenue Decline: Implications for Google?
March 17, 2012
The digital advertising industry took a hit in the last quarter of 2011, experiencing about a six percent decline in both display and search, recently released statistics from Kantar Media, which we learned about in ClickZ’s “Spending on Digital Ads Fell Sharply in Q4.”
The optimism of the alleged economic recovery seems to be false, if the Kantar data are accurate. The firm’s numbers show display ad revenue slipped 5.9 percent compared to the same quarter in 2010, while paid search dollars took a somewhat surprising 6.4 percent downturn. Leaner spending by telecommunications providers, automobile manufacturers and businesses in the local sector as a major factor, Kantar Media reports.
But display and search were not the only ad sectors hurt by the overall economic climate. Kantar’s statistics indicate the entire ad industry suffered a one percent revenue drop compared to 2010, marking the first time a quarter’s revenue declined since the end of 2009 and dashing the hopes of many for a recovery. Perhaps this trend is motivating Yahoo to outsource advertising and Google to take steps to enhance its advertising platform.
There were some bright spots. For example, there was a solid football season, the World Series’ seven games and Fox Networks’ new vocalists’ contest The X Factor. Each helped television advertising to couch potatoes growing in the vast wasteland to expand. grow. Kantar reports network TV advertising for Q4 grew 7.7 percent.
Advertising in beleaguered consumer magazines fell 5.2 percent. Sunday magazines’ ad spending dropped 9.8 percent and local newspapers spent 3.9 percent less than last year, marking a continuation of the downward spiral the print industry has been experiencing over the last several years.
Internet ad spending in general gained only slightly with a .4 percent increase in revenue, while online display advertising lost 2.8 percent of its revenue compared to last year, and display ad spending experienced a 5.5 percent decline.
Considering the fact that the revenue streams of search engines like Bing, Yahoo! and Google are made up largely of advertising revenue, some have speculated that these declines in ad spending may push these search engines to charge its users more, shotgun out more ads in hopes of producing clicks which will encourage advertisers to spend more, or saturate a market sector for big spenders who want to reach anyone who is looking for a hotel, airplane flight, or celebrity news item..
“If true, this is bad news for those depending on online ad revenues,” said Google expert Stephen E Arnold, who maintains the site www.arnoldit.com. “If Google revenues go south, the company will take immediate and direct action to pump up revenues and sustain growth. After 13 years of trying to diversify revenue, Google is living up to Steve Ballmer’s quip that ‘Google is a one trick pony.’ The pony is aging now.”
Jonathan Tressler, March 16, 2012
Sponsored by Pandia.com
Quote to Note: Publisher Strips the Internet Bare
March 15, 2012
Quote to Note. Interesting write up by a poobah fearful of losing his elephants. Point your vile browser thing at “John R. MacArthur: Internet Con Men Ravage Publishing.” Here is the quote I noted:
As far as I know, there isn’t a single profitable online-only magazine or newspaper in the United States and there isn’t a single profitable newspaper or magazine with an online edition that is seriously considering dropping its print edition.
The write up was free when I located the essay. I don’t have much of an opinion on the arguments in the poobah’s write up. Too late.
Stephen E Arnold, March 15, 2012
Sponsored by Pandia.com
More NASA Technical Excitement: Hackers in the Entity
March 13, 2012
One hopes that some good will come of this.
At one point last year, “Hackers Had ‘Full Functional Control’ of NASA Computers,” reports BBC News. NASA had 5,408 computer security incidents in 2010 and 2011. Furthermore, from April 2009 and April 2011, the agency lost track of 48 its own mobile computing devices through loss or theft. On top of that, this incident; the article reports:
“[NASA Inspector General Paul K.] said that the attackers had ‘full system access’ and would have been able to ‘modify, copy, or delete sensitive files’ or ‘upload hacking tools to steal user credentials and compromise other NASA systems’. . . . Mr. Martin said NASA was a ‘target-rich environment for cyber attacks’. He said that the motivation of the hackers ranged from ‘individuals testing their skill to break into NASA systems, to well-organized criminal enterprises hacking for profit, to intrusions that may have been sponsored by foreign intelligence services’”.
Graduated degrees of bad news for the agency. NASA has since claimed “significant progress to protect the agency’s IT systems.” Note they don’t claim it’s locked down tight.
Officials do insist that “at no point in time have operations of the International Space Station been in jeopardy due to a data breach.” That’s good to know.
NASA has been licensing nifty technology to help the agency “manage knowledge.” Let’s hope NASA gets its knowledge under control or there will be more unfortunate incidents at an agency which is supposed to be darned good at technology. I am beginning for formulate some doubts about NASA’s technical capabilities.
Cynthia Murrell, March 13, 2012
Sponsored by Pandia.com
Tools for Mobile Sites
March 9, 2012
The unstoppable adoption of smartphones has led to a need for drastic mobile web site optimization according to the article “Mobile Site Mania” on RetailSolutionsOnline.com. The push to develop either exclusively mobile sites or main pages that are simplified to view on a smartphone has almost reached a frantic pace as competitors race to be the first and best in mobile business.
This article suggests that growing use of phones and tablets have necessitated tweaks to sites in the form of simplification and tools especially intended for mobile users. Simple changes included confining menus to the margins and imbedding fewer photos and text on pages that once strove to be elaborate. Tools that are gaining more use include buttons to call or email the business directly and GPS to automatically provide the nearest relevant location.
Many are going a step further with software to ease the transition to mobile and allow for customization to fit specific customer needs.
From the article:
“Some vendors have released technology for mobile that provides interchangeable brand encounters across touchpoints to reduce frustration and accelerate cross-channel sales. For example, Oracle Endeca for Mobile allows your mobile customers to search and browse your entire product catalog, watch videos, create wish lists, download PDFs, read and write user reviews, and proceed through checkout — all from their mobile devices.”
Specialized software vendors like Endeca will allow for such ease of use that we will likely continue to see a merging of web and mobile features and functionality. It will be interesting to see if one platform overshadows another in the near future.
Derek Clark, March 9, 2012
Sponsored by Pandia.com
Exogenous Complexity 5: Fees for Online Content
March 7, 2012
I wanted to capture some thoughts sparked by some recent articles about traditional publishing. If you believe that the good old days are coming back for newspapers and magazines, stop reading. If you want to know my thoughts about the challenges many, many traditional publishers face, soldier on. Want to set me straight. Please, use the comments section of this Web log. —Stephen E Arnold
Introduction
I would have commented on the Wall Street Journal’s “Papers Put Faith in Pay Walls” on Monday, March 5, 2012. Unfortunately, the dead tree version of the newspaper did not arrive until this morning (March 6, 2012). I was waiting to find out how long it would take the estimable Wall Street Journal to get my print subscription to me in rural Kentucky. The answer? A day as in “a day late and a dollar short.”
Here’s what I learned on page B5:
As more newspapers close the door on free access to their websites [sic], some publishers are still waiting for paying customers to pour in.
No mention of the alleged calisthenics in which the News Corp.’s staff have undertaken in order to get a story. But the message for me was clear. Newspapers, like most of those dependent on resource rich, non digital methods of generating revenue, have to do something. In the case of the alleged actions of the News Corp. I am hypothesizing that almost anything seems to be worth considering.
Is online to blame? Are dark forces of 12 year olds who download content the root of the challenges? Is technology going to solve another problem or just add to the existing challenges?
Making money online is a tough, thankless task. A happy quack to http://www.calwatchdog.com/tag/sisyphus/
My view is that pay walls are just one manifestation of the wrenching dislocations demographic preferences, technology, financial larking, and plain old stubbornness unleash. The Wall Street Journal explains several pay wall plans; for example, the Wall Street Journal is $207 a year versus the New York Times’s fee of $195.
The answer for me is that I did not miss the hard copy Wall Street Journal too much. I dropped the New York Times print subscription and I seem to be doing okay without that environmentally-hostile bundle of cellulose and chemically-infused ink. Furthermore, I don’t use either the Wall Street Journal or the New York Times online. The reason is that edutainment, soft features, recycled news releases, and sensationalism do not add value to my day in Harrod’s Creek, Kentucky. When I look at an aggregation of stories, sometimes I click and see a full text article from one of these two newspapers. Sometimes I get the story. Sometimes I get asked to sign up. If the story displays, fine. If not, I click to another tab.
When I worked at Halliburton NUS and then at Booz, Allen & Hamilton, reading the Wall Street Journal and the New York Times was part of the “package”. Now I am no longer a blue chip “package.” I am okay with that repositioning. The upside is that I don’t fool with leather briefcases, ties, and white shirts unless I have to attend a funeral. At my own, The downside is that I am getting old, and at age 67 less and less interested in MBA wackiness. I have no doubt I will be decked out in my “real” job attire. For now, I am okay with tan pants, a cheap nylon shirt, a worn Reebok warm up jacket, and whatever information I can view on my computing device.
Newspaper publishing has not adjusted to age as I have. Here’s a factoid from my notes about online revenue:
When printed content shifts to digital form, the online version shifts from “must have” to “nice to have”. As a result, the revenues from online cost more to generate and despite the higher costs, the margins suck. Publishers don’t like to accept the fact that the shift to online alters the value of the content. Publishers have high fixed costs, and online thrives when costs are driven as low as possible.
Net net: Higher costs and lower revenue are the status quo for most traditional publishers. Sure, there are exceptions, but these are often on a knife edge of survival. Check out the hapless Thomson Corp. Just don’t take the job of CEO because it is a revolving door peppered with logos of Thomson and Reuters and financial results which are deteriorating. Think Thomson is a winner? Jump to Wolters Kluwer, Pearson, or almost any other “real” publishing outfit. These are interesting environment for lawyers and accountants. Journalists are not quite as sanguine as those with golden parachutes and a year or two to “fix up” the balance sheets.
Identity Theft and Social Media Scares
March 7, 2012
Ah, The Culture of Fear is finally reaching social media. With search morphing from precision and recall to asking one’s closest online pals, fear and search may now become unlikely bed fellows.
I came across an interesting article today (while taking a break from browsing my social media accounts on my smartphone) titled, “Smartphone, Social Media Users at Risk for Identity Fraud.” According to the piece, smartphone owners and social media users have an increased risk of becoming a victim of identity theft because of a lack of adequate security settings. A recent report on identity fraud by Javelin Strategy and Research found that 7 percent of smartphone users were victims of identity fraud last year, compared to the 4.9 percent rate among the general population. The article tells us more:
Around 62 percent [of smartphone owners] said they don’t use a password or a pin code to lock their devices. About 32 percent admitted to saving log-in information on their devices. Social media and mobile behaviors made users more vulnerable to fraud, according to the report. Users of social networking services, such as LinkedIn, Google+, Facebook and Twitter, had the highest incidence of fraud. Consumers who actively engage with social media and use a smartphone were found to have a disproportionate rate of identity fraud than consumers who do not use in these services.
Because of GPS-enabled location data and personal information shared over these networks, users are putting themselves at risk. However, when it comes to sharing information on smartphones and social media, users’ fear may be misdirected and misinformed. It seems to me that a 2 percent increase in identity theft possibilities might not be the biggest of our problems.
Andrea Hayden, March 7, 2012
Sponsored by Pandia.com
LexisNexis Fails to Make the Leap
March 2, 2012
Leap Day is a bit odd for everyone. It just seems strange to have the 29th added to February every four years. However, for the most part, everyone assumes that Leap Day will cause no major problems. That was not the case for some law librarians who reported their findings in, “Lexis Litigation Lists Lag on LeapDay.”
“While trying to run a Litigant Strategic Profile from LexisNexis’ CourtLink system, we kept noticing that the reports simply wouldn’t run. We contacted Lexis in the morning to see what the issue was and they told us that they would investigate the issue and return our call as soon as they figured out what was causing it, or when they got it corrected. Morning turned to afternoon, and finally we heard back from them with a surprising answer. Turns out that the Litigant Strategic Profiles couldn’t understand February 29th, and therefore the reports simply wouldn’t run. The solution was to not run the reports until March 1st, when the system would be back to normal.”
The author rightly points out that his $2 alarm clock recognizes Leap Day, but a very expensive subscription database cannot. Needless to say, anyone needing Litigant Strategic Profiles on February 29, 2012, would not be satisfied to wait until the next day to continue their projects. The news is a poor reflection on LexisNexis. While the company later denied the Leap Day connection, and maintains it was a non-related “systems issue,” this is a good reminder of how dependent we are as professionals upon information storage and retrieval systems.
Glitches are a reality, bugs a way of life, but when our systems shut down, we shut down. This is all the more reason to invest in trusted, vetted information solutions and have contingency and redundancy plans for when issues arise. Even then, problems will occur, but stay calm and trust those old-fashioned solutions: patience and common sense.
Emily Rae Aldridge, March 2, 2012
Sponsored by Pandia.com
The Lady Librarian of Toronto
March 1, 2012
Ah, the good old days. Canada’s The Globe and Mail profiles a powerhouse of a librarian who recently passed away at the age of 100 in “When Lady Librarians Always Wore Skirts and You didn’t Dare Make Noise.” When Alice Moulton began her career, libraries were very different than they are today. Writer Judy Stoffman describes:
“When Alice Moulton went to work at the University of Toronto library in 1942, libraries were forbidding, restricted spaces organized around the near-sacred instrument known as the card catalogue. They were ruled by a chief librarian, always male, whose word was law. Staff usually consisted of prim maiden ladies, dressed in skirts and wearing serious glasses, like the character played by Donna Reed in It’s a Wonderful Life, in the alternate life she would have had without Jimmy Stewart.”
The article is worth reading if only as a profile of a strong woman from a bygone era, but it also paints a portrait of libraries in the 20th Century. Among other things, Stoffman reveals that, in the ‘40s and ‘50s, libraries had a locked room called the “inferno” where the banned books were kept. In the spirit of free access to information, such volumes had been released from captivity by the time Moulton retired.
With the modern-day censorship issues that have emerged online, we would not be surprised if brick-and-mortar libraries experienced a resurgence. They may be back if censorship kicks into high gear and we return to the printed word.
Cynthia Murrell, March 1, 2012
Sponsored by Pandia.com
Exogenous Complexity 3: Being Clever
February 24, 2012
I just submitted my March 2012 column to Enterprise Technology Management, published in London by IMI Publishing. In that column I explored the impact of Google’s privacy stance on the firm’s enterprise software business. I am not letting any tiny cat out of a big bag when I suggested that the blow back might be a thorn in Googzilla’s extra large foot.
In this essay, I want to consider exogenous complexity in the context of the consumerization of information technology and, by extension, on information access in an organization. The spark for my thinking was the write up “Google, Safari and Our Final Privacy Wake-Up Call.”
Here’s a clever action. MIT students put a red truck on top of the dome. For more see http://radioboston.wbur.org/2011/04/06/mit-hacks.
If you do not have an iPad or an iPhone or an Android device, you will want to stop reading. Consumerization of information technology boils down to employees and contract workers who show up with mobile devices (yes, including laptops) at work. In the brave new world, the nanny instincts of traditional information technology managers are little more than annoying nags from a corporate mom.
The reality is that when consumer devices enter the workplace, three externalality happen in my experience.
First, security is mostly ineffective. Clever folks then exploit vulnerable systems. I think this is why clever people say that the customer is to blame. So clever exploits cluelessness. Clever is exogenous for the non clever. There are some actions an employer can take; for example, confiscating personal devices before the employee enters the work area. This works in certain law enforcement, intelligence, and a handful of other environments; for example, fabrication facilities in electronics or pharmaceuticals. Mobile devices have cameras and can “do” video. “Secret” processes can become un-secret in a nonce. In the free flowing, disorganized craziness of most organizations, personal devices are ignored or overlooked. In short, in a monitored financial trading environment, a professional can send messages outside the firm and the bank’s security and monitoring systems are happily ignorant. The cost of dropping a truly secure box around a work place is expensive and beyond the core competency of most information technology professionals.
Second, employees blur information which is “for work” with information which is “for friends, lovers, or acquaintances.” The exogenous factor is political. To fix the problem, rules are framed. The more rule applied to a flawed system, the greater the likelihood is that clever people will exploit systems which ignore the rules. Clever actions, therefore, increase. In short, this is a variation of the Facebook phenomena when a posting can reach many people quickly or lie dormant until the data load explodes like long forgotten Fourth of July fire cracker. As people chase the fire, clever folks exploit the fire. Information time bombs are not thought about by most senior managers, but they are on the radar of those involved in a legal matter and in the minds of some disgruntled programmers. The half life of information is less well understood by most professionals than the difference between a uranium based reactor and a thorium based reactor. Work and life information are blended, and in my opinion, the compound is a dangerous one.
Third, vendors focusing on consumerizing information technology spur adoption of devices and practices which cannot be easily controlled. The data-Hoovering processes, therefore, can suck up information which is proprietary, of high value, and potentially damaging to the information owner. Information is not “like sand grains.” Some information is valueless; other information commands a high price. In fact, modern content processing and data analytic systems can take fragments of information and “fuse” them. To most people these amalgams are of little interest. But to someone with specialized knowledge, the fused data are not god nuggets, the fused data are a chunky rosy diamond, maybe a Pink Panther. As a result, an exogenous factor increases the flow of high value data through uncontrolled channels.
A happy quack to Gunaxin. You can see how clever, computer situations, and real life blend in this “pranking” poster. I would have described the wrapping of equipment in plastic “clever.” But I am the fume hood guy, Woodruff High School, 1958 to 1962. Image source: http://humor.gunaxin.com/five-funny-prank-fails/48387
Now, let’s think about being clever. When I was in high school, I was one of a group of 25 students who were placed in an “advanced” program. Part of the program included attending universities for additional course work. I ended up at the University of Illinois at age 15. I went back to regular high school, did some other Fancy Dan learning programs, and eventually graduated. My specialty was tricking students in “regular” chemistry into modifying their experiments to produce interesting results. One of these suggestions resulted in a fume hood catching fire. Another dispersed carbon strands through the school’s ventilation system. I thought I was clever, but eventually Mr. Shepherd, the chemistry teach, found out that I was the “clever” one. I sat in the hall for the balance of the semester. I adapted quickly, got an A, and became semi-famous. I was already sitting in the hall for writing essays filled with double entendres. Sigh. Clever has its burdens. Some clever folks just retreat into a private world. The Internet is ideal for providing an environment in which isolated clever people can find a “friend.” Once a couple of clever folks hook up, the result is lots of clever activity. Most of the clever activity is not appreciated by the non clever. There is the social angle and the understanding angle. In order to explain a clever action, one has to be somewhat clever. The non clever have no clue what has been done, why, when, or how. There is a general annoyance factor associated with any clever action. So, clever usually gets masked or shrouded in something along the lines, “Gee, I am sorry” or “Goodness gracious, I did not think you would be annoyed.” Apologies usually work because the non clever believe the person saying “I’m sorry” really means it. Nah. I never meant it. I did not pay for the fume hood or the air filter replacement. Clever, right?
What happens when folks from the type of academic experience I had go to work in big companies. Well, it is sink or swim. I have been fortunate because my “real” work experiences began at Halliburton Nuclear Services and continued at Booz, Allen & Hamilton when it was a solid blue chip firm, not the azure chip outfit it is today. The fact that I was surrounded by nuclear engineers whose idea of socializing was arguing about Monte Carlo code and nuclear fuel degradation at the local exercise club. At Booz, Allen the environment was not as erudite as the nuclear outfit, but there were lots of bright people who were actually able to conduct a normal conversation. Nevertheless, the Type As made life interesting for one another, senior managers, clients, and family. Ooops. At the Booz, Allen I knew, one’s family was one’s colleagues. Most spouses had no idea about the odd ball world of big time consulting. There were exceptions. Some folks married a secretary or colleague. That way the spouse knew what work was like. Others just married the firm, converting “quality time” into two days with the dependents at a posh resort.
So clever usually causes one to seek out other clever people or find a circle of friends who appreciate the heat generated by aluminum powder in an oxygen rich environment. When a company employs clever people, it is possible to generalize:
Clever people do clever things.
What’s this mean in search and information access? You probably already know that clever people often have a healthy sense of self worth. There is also arrogance, a most charming quality among other clever people. The non-clever find the arrogance “thing” less appealing.
Let’s talk about information access.
Let’s assume that a clever person wants to know where a particular group of users navigate via a mobile device or a traditional browser. Clever folks know about persistent cookies, workarounds for default privacy settings, spoofing built in browser functions, or installation of rogue code which resets certain user selected settings on a heartbeat or restart. Now those in my advanced class would get a kick out these types of actions. Clever people appreciate the work of clever people. When the work leaves the “non advanced” in a clueless state, the fun curve does the hockey stick schtick. So clever enthuses those who are clever. The unclever are, by definition, clueless and not impressed. For really nifty clever actions, the unclever get annoyed, maybe mad. I was threatened by one student when the Friday afternoon fume hood event took place. Fortunately my debate coach intervened. Hey, I was winning and a broken nose would have imperiled my chances at the tournament on Saturday.
Now more exogenous complexity. Those who are clever often ignore unintended consequences. I could have been expelled, but I figured my getting into big trouble would have created problems with far reaching implications. I won a State Championship in the year of the fume hood. I won some silly scholarship. I published a story in the St Louis Post Dispatch called “Burger Boat Drive In.” I had a poem in a national anthology. So, I concluded that a little sport in regular chemistry class would not have any significant impact. I was correct.
However, when clever people do clever things in a larger arena, then the assumptions have to be recalibrated. Clever people may not look beyond their cube or outside their computer’s display. That’s when the exogenous complexity thing kicks in.
So Google’s clever folks allegedly did some work arounds. But the work around allowed Microsoft to launch an attack on Google. Then the media picked up on the work around and the Microsoft push back. The event allowed me to raise the question, “So workers bring their own consumerized device to work. What’s being tracked? Do you know? Answer: Nope.” What’s Google do? Apologize. Hey, this worked for me with the fume hood event, but on a global stage when organizations are pretty much lost in space when it comes to control of information, effective security, and managing crazed 20 somethings—wow.
In short, the datasphere encourages and rewards exogenous behavior by clever people. Those who are unclever take actions which sets off a flood of actions which benefit the clever.
Clever. Good sometimes. Other times. Not so good. But it is better to be clever than unclever. Exogenous factors reward the clever and brutalize the unclever.
Stephen E Arnold, February 24, 2012
Sponsored by Pandia.com
DuckDuckGo Excitement: Real or Semi Real?
February 19, 2012
I like DuckDuckGo. I like Blekko. I like Yandex. I don’t get too excited about Bing because the number of useful pages indexed in a meaningful way is an issue for me. I don’t jump up and down for Exalead’s free Web search because the span of results seems narrow and stale for some of my queries.I don’t like Google as much as I did in 2006 because relevance seems to be—ah, how shall I phrase it—situational.
So it is not surprising that DuckDuckGo is showing a rise in usage. You can get the metrics which are causing some azure chip consultants to crank up their sales efforts for a special Web search usage report. You can see some of the DuckDuckGo data in “DuckDuckGo Searches Going Waaaaay Up.” The data show DuckDuckGo enjoying an increase in usage. Assume the data in the write up are accurate. DuckDuckGo has doubled its direct queries, nosing close to one million queries. Here is the key passage:
For the first time ever since the search engine opened its doors, it received more than 1 million direct search queries. These are generated by direct user requests. Api requests sit steady at the ten million per day mark.
Last I heard, Google was in the three billion queries per day territory. Big difference. Real growth but I think more “semi real” when compared to Google’s traffic. Worth monitoring the trend, however.
Stephen E Arnold, February 19, 2012
Sponsored by Pandia.com
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