Octavianworld

Adify: A First Step Toward A Multi-Tier Online Ad Network Ecosystem

Yesterday I posted ideas about the likely emergence of multi-tier publisher aggregation mechanisms for the online ad market.  Things move fast.  Today, via TechCrunch, I learned about Adify, one of 13 firms selected from over 200 to present at today's Web 2.0 conference in SF. Adify allows publishers to set up their own virtual ad networks to market ad space they have to sell on their web properties.  Translated:  it's sort of a specialized eBay or Amazon storefront for online ad space.

So, now advertisers can search and browse these storefronts to buy space at retail in highly targeted ways.  But we can also predict that new intermediaries will emerge to package and broker value-added bundles to advertisers who lack the time or the sophistication to do the shopping themselves.  These intermediaries could be new services provided by the traditional ad networks, or they could be new players entirely. 

More broadly, what we're seeing is the predictable exploitation of the big arbitrage opportunity in online advertising.  Rough numbers:  a $20 billion online ad market, with (conservatively) a 15% margin*, featuring (my guess) a 50% arbitrage opportunity =  a >$1 billion market available to the quick and the clever.

(*Prior to its recent stumble, Aquantive's March 10Q reports that, excluding consulting by Razorfish and DNA,  revenues and pre-tax profits were $37 million and $15 million, respectively.  After a share of corporate G&A and taxes, I make that a 15% margin more or less.  Of course one company's profit margin is only a vague, flawed proxy for the industry profit pool, but it gives you a feel for how lucrative this business currently is.  I'd guess Hellman & Friedman have done very nicely after taking DoubleClick private in 2005, what with lower overhead and tax-deductible interest on buyout debt.)

Related:  Madhens

De-Optimized

Follow-up to my post on MegaKarma: traffic to my blog doubled (rough estimate), and a couple of people voted my post up on Reddit.  But then I got voted back down into the dark hole I came from.  Oh, the humiliation.

Moral of this story:  Just as is true in the real world, there's no substitute for personal networking.  Send your posts to others, ask them to comment constructively on their blogs and link to you if appropriate.  Services like Megakarma might be helpful, but only on the margin.  Anyone have a different experience?

MegaKarma: Social Media Optimization

Via an ad on Adverblog, I learned of MegaKarma.net, a service that helps you game submissions to social bookmarking / voting services like Digg and Reddit.  The basic idea is "you scratch my back, I scratch yours":  once you've submitted your link to the social bookmarking services, you submit it to MegaKarma, which then emails it to a list of other members of these services who vote it up (if they like it) after it's posted.  I'm just trying this service now (with this post!), so I can't say yet whether or not it seems to be effective.  But it does seem like a way around the "credibility power law" effect that emerges in systems like these, where "power posters" have disproportionate clout in the algorithms the services (properly) use for rankings.  Just as we had PR firms to spread the word and build buzz in Old Media, we now have services like these for the New.  Technology changes, but socioeconomic dynamics remain the same.

Postscript:  Mike-O-Matic's take

"Monetizing" The Blogosphere: Networks of Networks

Typepad users like me who loggged in today saw Typepad plugging Bayraider, a new shopping blog from Shiny Media, which seems to be trying to follow in the wake of PopSugar.  With the entry costs being so low, a few motivated friends can get together and put together small networks that collectively improve their ability to sell ads.  This makes me think that we'll see more entrepreneurs putting together such networks, following in the model pioneered by Federated Media.  Of course, with the A-Listers snapped up already, I think we can expect to see a multi-tiered market aggregation market emerge: 

Unpacking the Digital Video Revolution (Podcast)

Here's a great podcast of a recent presentation by Brightcove CEO Jeremy Allaire on the structure of the film-TV-video production and distribution business, and how distributing video over the Internet blows it up and creates new possibilities. 

http://www.itconversations.com/audio/download/ITConversations-996.mp3

(Note: I drafted this post in March, and never got around to publishing it.  So this might be a bit dated, but I think it's still really useful.)

The Medium Is Not The Message

PHP may be the new Powerpoint, but my friend Ben Kline, a senior ad agency exec, says he's seen too many situations recently where people confuse having a [pick your new media channel:  blogs, podcasts, video, "community"] for having good content on them.  So what makes good content for these new channels?  It depends, of course, on audience, subject, occasion, device...  But I've been thinking that there are some over-arching principles that distinguish better stuff in these channels.  Kathy Sierra's talk at the OpenACS/.LRN conference a couple of days ago helped bring this into sharper focus for me.  Here's a short list of things that make my emerging 3x5 card filter for what makes good new media content:

PHP Is The New PowerPoint

Playing around with Ning's social application templates recently.  Have found throwing together simple demonstrations with them to be so much more instructive and persuasive than traditional presentations.  Once you clone one of their templates to create a starting point for your efforts, it's easy to customize them, by simply editing/ extending the source code.  Nice for wannabes like me, I simply edit around the edges rather than starting from scratch (which has its own merits under different circumstances).

Graphic Friendships, Part II

Following on my recent post outlining a tag-oriented approach to collaborative filtering, some reactions and further ideas:

Philip Greenspun presented a new approach for filtering posts on photo.net at this morning's OpenACS/.LRN conference. He calls it the "Solar Magnitude Forum".

Kate Ehrlich at IBM Research, where they've developed the Dogear enterprise social bookmarking application, offered these thoughts: "[re:] some of the issues you raise about tag overlap... There are a couple of issues with it as I see,  One is that there is a high degree of variance in tag use. So, for instance, you and I may bookmark the same pages but use completely different tags.  And vice versa.  We may use similar tags but on completely different (by some measure) webpages. The other is the power law problem.  There are a few people who contribute a large number of tags.  Their data tends to overwhelm the system when it comes to looking for matches so one has to do some kind of normalization first..."

What Philip and Kate are working on are more advanced than what I described, to be sure.  But Misiek Piskorski  at HBS wrote me a very thoughtful note that said essentially, "great idea, but first we have to get more people tagging!"

Also, Bill Ives posted recently on an interesting roundup of social bookmarking sites.

Appassionata

This morning I went to the OpenACS/ .LRN conference Carl Blesius organized at Harvard Medical School.  Carl recruited Kathy Sierra, author of the Creating Passionate Users blog, as a keynote speaker.  13 pages of notes for a 45-minute presentation suggest she had my attention.  Here are some excerpts of my notes: