Category Archives: technology

What does the Net Neutrality decision mean for Online Advertising?

A U.S. appeals court this Tuesday threw out federal rules that require broadband providers to treat all internet traffic equally, increasing the chance that websites that take up a large percentage of bandwidth like Google and Netflix might have to pay a premium to ensure quality service to it’s users.

While the regulatory issues are complex, the basic concept of net neutrality is not: internet service providers (ISPs), such as Verizon and AT&T, and national governments should treat all sites and data on the internet equally and not discriminate or charge different rates based on traffic or any other user metric. In other words, joeschmo.net and Google should be treated the exact same.

In 2010, The FCC adopted regulation to establish an “open internet” and barred ISPs from blocking against any sort of web content. In 2011, Verizon challenged this regulation and the D.C. Circuit Court of Appeals ruled in Verizon’s favor Tuesday. Read more about the case. What this decision essentially does is allow ISPs the opportunity to create a tiered system of internet speed based on bandwidth-use. In other words, ISPs will be able to charge internet companies a premium for their users to experience their site at high speeds. While questions on civil liberties and monopolistic practices are paramount here, the effects of this decision on a commercial level are far reaching indeed, online advertising being no exception.

One of the greatest concerns around this decision is that without net neutrality, innovation could be stifled and barriers of entry to the tech and digital marketplace could become too great for startups and other internet ventures to succeed. If ISPs charged a premium for high speed internet, then new ventures that do not have the capital to pay for the service potentially fail before they even begin because the impossibility of a good user experience would overshadow the value of the service. In turn this would greatly impede on an advertiser’s consideration set and ability to diversify a digital buy. If sites need to pay a premium for speed, the sites who can’t pay decrease in traffic and the internet becomes a group of concentrated impression pockets.

Every player in the advertising place could be affected by this. For networks whose pitch is often scale and full delivery, this trend could greatly depreciate the value in their offerings and impede on their abilities to keep up site rosters and relationships. For programmatic buyers, a decrease in impression supply could increase the average price levels on inventory and thus make a once efficient model much more expensive. For publishers, higher premiums for bandwidth would mean greater overhead that would need to be offset with either higher prices on ad space or the culling of assets (layoffs) to retain profit margins, and an already competitive agency world would need to adjust commissions and fees to compensate for higher advertising costs, possibly causing brands to take their strategy and planning in house.

But what all these increases in advertising costs really do in the end is hurt the small medium enterprises. While the higher costs would cause larger brands to rethink their media budget, SMEs who are following consumers into the digital space but are working with smaller budgets could be limited and potentially harmed by the increased premiums on digital real-estate and pushed aside by the larger corporations that are able and willing to pay the hiked prices.

It should be said that this is not yet a reality and that the issue is still within in the court system. Furthermore, the decision in some ways was actually positive, laying out ways in which the FCC can enforce net neutrality. However, the issue should be taken seriously among all advertisers. In an article entitled Loss of Net Neutrality Could Be Bad for All Online Video, Christopher Rick concludes: “Can you afford to have your ads not reach 100 million people that they reach now? Can you afford to serve one billion less ads than you do now? Can you afford to not get together with others in your industry and put your foot down…firmly on the side of net neutrality?”

Can we?

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Yahoo Bought Aviate for $80M according to Techcrunch

Untitled-2As a follow up to my previous story, Techcrunch is reporting that Yahoo purchased the mobile startup Aviate for approximately $80M.

“My source didn’t know any of the details beyond the amount,” Techcrunch Anthony Ha reports, “…that’s an impressive price for a young startup that raised a $1.8 million Series A (from Highland Capital, Andreessen Horowitz, and others) less than a year ago. (It was also incubated at StartX.)”

Yahoo is currently declining to comment, but regardless, this falls right in line with Mayer’s acquisition-happy behavior as the new CEO of the portal giant, so it should come to no surprise to anyone.

Mayer’s new hashtag: #swingforthefences.

Yahoo Makes Three Big Ad Moves during CES

In the past two days Yahoo has made three big moves in the advertising tech world: unveiling ‘Yahoo Advertising,’ picking up Aviate to improve their mobile experience, and creating their own new tech hub, ‘Yahoo Tech.’

Yahoo Advertising

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Yesterday at the Yahoo CES keynote, Marissa Mayer announced Yahoo’s new ‘all-in-one’ advertising solution: Yahoo Advertising. While the name isn’t glamorous, it strikes right at the heart of what Yahoo is trying to do: give advertisers “a comprehensive suite of web, mobile, and video ad products across native, audience, and premium display, which are accessible through a new buying platform.” While their ‘elevator’ is something you’d hear in any vendor meeting on the proverbial Madison Avenue, the new platform does bring some sense to Mayer’s recent run of acquisitions.

What is most notable is that the new platform finally gives Tumblr a clear role and purpose at the company, and a clear position for agencies to consider. Until recently, advertisers didn’t quite know how to utilize or even think about Tumblr. Marissa answered at least some of our answers with presenting Tumblr as the social arm of ‘Yahoo Advertising’ where companies will now be able to purchase sponsored posts as part of their overall buy with the purple giant.

See the first blog post for other new features rolling out.

Yahoo Picks Up Aviate:

Aviate PictureYesterday it was Mayer also announced that Yahoo has picked up the mobile company Aviate, which claims to be an “intelligent home screen service.”

While terms of the deal were not immediately disclosed, Mayer suggested that Yahoo was looking to use Aviate’s technology to deliver content in ways that are “smarter and more personalized.” Yahoo has had some great success with their recent mobile apps. Yahoo Weather, for example, looks sleek on any smart device and is my personal go-to out of the three weather apps on my phone. Depending on the terms of the deal, this seems to be a smart buy for the company and continues to open up their mobile opportunity for advertisers.

Read more about the Aviate acquisition.

Yahoo Tech: a new Yahoo hub for Tech News

Yahoo Tech logo

Finally, this morning Yahoo launched their new hub for tech news: Yahoo Tech. While Yahoo is jumping into a space that is beyond cluttered, chief editor and “founder” of Yahoo Tech David Pogue claims YT will be a tech site of a different sort, taking the more “human side of tech.”

Pogue’s introduction serves more as a introduction of himself and his take on the current tech editorial space. He clearly states what he is not: he’s not a gearhead, “ If I were, I’d steer you to Engadget, AnandTech or Tom’s Hardware;” he is not a PR person, “I don’t speak that language. You’ll never catch me using terms like ‘price point’ when I mean ‘price,’ or ‘form factor’ when I mean ‘size.’ I’ll never say ‘content’ when I mean video, ‘solution’ when I mean product, ‘DRM’ when I mean copy protection, or ‘functionality’ when I mean ‘feature’;” and he is not a member of the tech clergy: “But honestly—you know what I wish? That the haters and fanboys of each tech religion could gather together in a big school gym and either (a) battle it out, (b) smoke peace pipes, or (c) finally acknowledge that this is a self-esteem issue, not a technological one.”

You can read the blog post yourself, but for me, it reminiscent of the time I sat in on a rural religious service and the minister made fun of people who could translate and interpret the original Latin text of the lesson we were reading. While I don’t think Pogue is going for an anti-intellectual vibe, it does come off as a little abrasive to people who do consider themselves in-line with all things tech. Nevertheless, it’s clear Yahoo is once again aiming for more premium content.

In sum, with a new network, more acquisitions, and more content, Yahoo is moving fast and furiously to make a big comeback and bring in a new era of advertising for the portal. It will be exciting to see how it plays out.

Video Starturp Vidible Raises $3.35M in Series A Funding

Vidible PictureVidible has raised $3.35M in Series A funding led by Greycroft, according to an article released last Friday on Techrunch. Vidible is a programmatic video content exchange with a complete SaaS platform for video management to syndication and analytics. Vidible aims to deliver professional quality video content to the right context or audience at a transparent price in real time across all devices.

According to the article, President of Vidible Tim Mahlman wants to improve the “archaic” methods of syndicating videos and give more control and transparency to buyers and sellers. Vidible’s solve is a platform that allows buyers to search for different kinds of videos, while the content creators have control over where their videos get played, with both sides having access to analytics.

The video advertising business has seen a big surge in the last year. The continued growth in video consumption has led to an increase in demand from advertisers and agencies for more video impressions. Two of the big five adtech IPOs of last year were Tremor Video and YuMe, both specializing in video advertising. The content creation side hasn’t been any slower. One of Yahoo’s biggest deals last year was picking up Katie Couric in an attempt to show viewers and advertisers that they are focused on producing original and premium video content.

Greycroft’s John Elton thinks that Vidible is taking advantage of this recent growth. “I think it’s a new medium,” the article quoted Elton as saying, “There are people that do it very well, that are looking for more distribution, and there are publishers looking for content that’s appropriate for their site.” Elton also finds Vidible’s emphasis on monetization attractive. Vidible’s current setup has the content buyer pay a set rate based on impressions, then they can either run their own ads with the videos or run ads from one of Vidible’s network partners.

Until recently Vidible has been focused on R&D, but with this new round of funding it’s clear they will start to build out their business arm and client portfolio.

Yahoo display ads used to spread malware

Marissa Mayer is on a mission to get advertisers back to Yahoo, but she might be doing more damage control than building the client portfolio this week. On Friday, internet security firm Fox-IT reported that Yahoo’s servers were distributing malicious advertisements, affecting thousands of users in various countries.

“Clients visiting yahoo.com received advertisements served by ads.yahoo.com. Some of the advertisements are malicious,” the site reported, “Upon visiting the malicious advertisements users get redirected to a ‘Magnitude’ exploit kit via a HTTP redirect to seemingly random subdomains….All those domains are served from a single IP address: 193.169.245.78. This IP-address appears to be hosted in the Netherlands….This exploit kit exploits vulnerabilities in Java and installs a host of different malware….”

At the time the update was posted, Fox-IT estimated that Yahoo was sending around 300k visitors/hr to the malicious sites and believes there were around 27.000 infections every hour based on the standard 9% infection rate. Below is a chart of the countries most affected by the exploit kit, with the highest infection rates being in Romania, Great Britain, and France. Fox-IT doesn’t know exactly why those countries were most affected.

It almost goes without saying that this sort of attack could come with a tremendous cost for an already suffering Yahoo. Since stepping on as CEO, Marissa Mayer has spent billions in an effort to redress Yahoo as an advertising friendly brand: entering the social media space, picking up top talent, even reinventing the logo. Yet, despite her best efforts, Yahoo’s revenue continues to slip. This most recent debacle will almost certainly have agencies and advertisers second guessing whether it’s user safe, let alone brand safe, to have their advertisements on the purple portal, giving Yahoo another hurtle on their race back to profitability.

Mass Relevance included on Venture Beat’s ‘startups to watch’ in 2014

Untitled-1Venture Beat recently posted a list of the “26 amazing startups you need to watch in 2014.” On the list was social ad tech Mass Relevance, an SaaS platform that creates real-time consumer engagement models by aggregating, filtering, and re-displaying social content from any social network to any digital property – TV, web, mobile, or jumbotron.

Founded by Sam Decker, Eric Falcao, and Brian Danton, Mass Relevance wants to help large media companies manage the flow of social information. The platform takes data streams from various social networks (Twitter, Facebook, Vine, Instagram, YouTube, etc.) and aggregates them into a single visualization for clients. Brands can customize how they want to see or process the data: they can set word/hashtag filters, audience demographic filters (age range, gender, geography), and media or social network filters, among other things. The platform can also display the data through mobile apps, live TV broadcasts, websites, projector screens at conferences, stadium displays, and other visualizations that run alongside events. 

Here is a good example taken from their site: Mass Relevance helped CNN transform their Facebook data to create the Facebook + CNN Elections Insights page. The page incorporated a number of visualizations and allowed for a unique user experience. For example, users could view the election conversation by candidate, demographic, geography, or time-frame. According to Mass Relevance, the page drove a total of 1.4 million visits and 43,000 individual recommendations, and the top 5 posts on the page garnered an average of over 2,500 likes, with the top post capturing 7,500.

With the explosion of social media, processing and aggregating social data for large media companies and brands is a potentially lucrative market, and Mass Relevance isn’t the only company trying to capitalize. Apple recently bought the social media analytics startup Topsy, which offers users a way to analyze tweets, gather sentiment and measure the reach of a campaign, hashtag or message. Also worth mentioning is FeedMagnet, which “combines original content with curated ‘best-of’ 3rd-party articles and social posts, creating rich, diverse, and engaging brand experiences,” according to their site.

While the social aggregating space is gathering a full roster of competitors, Mass Relevance is clearly coming out as its leader. The company does a brilliant job of taking big data and turning it into meaningful insights. In a world on the verge of making sense of the constant flow of information, Mass Relevance has an enormous opportunity to help brands and other organizations understand the social universe.

2013 saw 26 tech IPOs, 6 were ad tech

It’s the eve of a new year and once again every media outlet on the web and otherwise is posting their “unique” recap of the year and thoughts of things to come. For technology news outlets, 2013 is a phenomenal year to recap due to the amount of growth and activity that occurred in the industry (Facebook, Twitter, Xbox, Playstation, etc). I’d like to follow suite and take a quick look at the activity in the ad tech space this year.

Today Mashable is reporting that 2013 had the most tech IPOs since 2000, aka the .com era. While the article primarily emphasis the .com bubble parallels that can be drawn, I would like specifically focus on what portion of this year’s tech IPOs were ad tech company’s. Below is copy of the diagram from the Mashable article that lists all the IPOs for this year:

Source: Mashable.com

Source: Mashable.com

Below I’ve recreated the above chart, but isolated the companies that fall into the ad tech category:

UntitledWith the exception of Rocket Fuel and Marketo, ad tech wasn’t a phenomenal performer. While the entire tech IPO market saw a total of 77.84% in returns for this year, ad tech saw a total of 32.97% which comes in just under the NASDAQ year end ROI of 40%.

Ad tech is definitely not a sure bet right now in the investment market, but there is no denying we are just seeing the beginning of the sector’s potential. 2013 will go down as a major step in the digital revolution: Social Media took flight with Facebook and Twitter IPOs, mediums of communication evolved with Snapchat and Instagram, companies like Netflix, Hulu, and Amazon redefined how we consume and think about content, and all forms of media finally realized the internet is not only here to stay, it is the future of everything. As more people come online and more companies think of creative ways to reach and entice customers, ad tech will become more innovative and more exciting, and, eventually, more profitable.