Week of May 4, 2009

Social Networking's Increasing Clout

Friday, May 8, 2009

Nielsen recently released a report called "Global Faces & Networked Places, detailing the increasing impact of social networking around the world. Their survey focused on 12 of the largest countries in the developed world. The report quantifies the astounding growth of the social net phenomenon.

Here are a few of the highlights of that report:

The #1 country for social networking is Brazil, where over 80% of all Internet users in 2008 spent time on social networking.

The fastest growing market was Germany, which saw an increase of 12 percentage points, from 39% of users to 51% from '07 to '08.

The US ranked 6th among the 12 countries surveyed with 67% of all online users accessing communities.

The global reach of online communities increased by 5 percentage points last year. This was the largest growth for any of the most popular segments of Internet usage:

Search 85.9%

Portals 85.2%

Software 73.4%

Communities 66.8%

YouTube Selling More Ads to Large Advertisers

Thursday, May 7, 2009

A couple of years ago, media analysts were celebrating the rise of user generated content. The king of UGC is YouTube, which has been in the vanguard of the battle over monetizing this customized content. The percentage of videos on YouTube with ads is still small, but it's growing and more big advertisers are participating. The most popular form is video pre-roll ads

According to AdAge, YouTube is selling ads on 9% of its US videos, up from 6% a year ago. This may seem like a small percentage, yet this represents more ads than the #2 video company, Fox Interactive, gets in page views each month. Still, the overall revenue for YouTube is amazingly small. Estimates of its ad sales range from $120 million by Screen Digest to as much as $500 million, according to Jeffries & Co.

TV Online Revenue Passes $1 Billion

Wednesday, May 6, 2009

A report by Borrell Associates for the Television Bureau of Advertising states that broadcast TV stations passed the $1 billion mark for online revenue in 2008. However, not all markets were equal, according to the survey. Stations in markets 1-20 saw online revenues go up by 65%, earning more than $1 million per station, on average. Stations in markets 51-100 saw an average gain of 33%. But those in markets 21-50 saw a 3% decline. Gordon Borrell, CEO of the company, said that they have seen a similar dip in newspapers in the middle markets, compared to those in bigger and smaller areas.

According to Borrell's numbers, TV still has quite a bit of upside in the local online ad market. Here's how various media did in the local online space, which accounted for $12.7 billion in '08:

Pure play Internet 47.2%

Newspapers 27.7%

Directories 10.8%

Radio anyone?

YouTube's Content ID

Tuesday, May 5, 2009

One of the most significant reasons for YouTube's increase in sales is its Content ID technology. This allows YouTube to place ads on a video once it is uploaded. With this ability, it has been able to convince more copyright holders to allow YouTube to keep content on its site. In the past, copyright holders would have demanded that unauthorized postings be pulled down. Now, with a way of monetizing these postings, more of this content has remained on YouTube.

Disney & Hulu Reach Agreement

Monday, May 4, 2009

Disney and Hulu have finally entered into an agreement to put Disney-produced TV content on the popular ad-supported video site. This means that 3 of the 4 networks are now participating in the Hulu venture, with CBS being the only holdout. Disney is getting an equity stake in Hulu as part of the deal. While a number of popular Disney-produced shows like Lost, Grey's Anatomy and Desperate Housewives will be available on Hulu, programming from ESPN will not.

In another sign of Hulu's growing clout, the video service is reportedly in talks with the 4 major music labels to add music videos to its offerings, bringing it into more of a collision course with YouTube.