OpenX opens kimono to reveal financials – prepwork for an IPO?
It’s the season for getting a peek at private Internet companies’ financial results.
Wall Street is still chewing over Facebook’s recently revealed numbers, and on Monday, OpenX Technologies, a private, venture-backed online ad company, served up some financial gristle of its own.
The company, which provides an online ad exchange as well as ad server technology, said that it is now on track to generate more than $100 million in revenue on an annualized run rate basis and that it became profitable in the fourth quarter of 2011.
And it said it expects to profitable in 2012.
The move comes a few weeks after Facebook, the world’s No.1 Internet social network, pulled the curtain back on its financials for the first time, revealing $3.7 billion in 2011 revenue, with the release of the prospectus for its upcoming IPO.
OpenX CEO Tim Cadogan said the release of some of its financial results was not a sign that it planned to follow Facebook’s footsteps into the public market — at least not immediately.
“It’s premature to commit to it at this point, but it’s definitely something we’ve been thinking about,” he said of an IPO.
Online advertising catches up to newspapers in 2010
The newspaper industry had a lot of bad knocks this year. Advertising revenue continued to decline, when just about every other media sector — like local broadcast TV, for example – rebounded beautifully. For newspaper companies the term “moderating ad revenue declines” has become the new flat.
Now comes word from the research firm eMarketer that online advertising in the U.S. is expected to outgun newspaper advertising in 2010. For the year, online ad spending is expected to rise about 14 percent to $25.8 billion, while print advertising spending in newspapers is expected to decline about 8 percent to $22.8 billion. The research firm includes everything from Google and eBay to the New York Times in its online advertising category.
eMarketer also points out that total ad spending for newspapers including print and online will reach $25.7 billion in 2010, which it says is ”shy of the $25.8 billion advertisers will spend on Internet ads.”
Except it all depends on how you do the math. The $25.8 billion figure for online ad spend also includes Internet advertising spending on newspaper websites. According to the Newspaper Association of America, newspapers online ad revenue hit about $2.7 billion in 2009. So taking out that figure, combined print and online advertising revenue for newspapers will still eclipse online advertising spending at all other websites except newspapers for 2010.
Yet, any way you slice it, the numbers still point to a worrisome trend: Any gains that newspapers make with online ad revenue is not enough to offset print losses.
(Photo: Reuters)
Google sees ad revenue in images
Google has turned its flagship Internet search engine into a key advertising channel for businesses over the past decade.
But Google has a variety of other online properties that it believes are also well-suited for advertising, and on Tuesday the company began to effort that appears intended to ramp-up advertising on its specialized search engine for images.
Google executives told reporters at a briefing in San Francisco that its Image Search product, which has cataloged more than 10 billion images of everything from celebrity photos to impressionist paintings, generates more than 1 billion page views everyday – a rare nugget of information about Web traffic from the search giant.
And Google unveiled a new ad format for Image Search that allows marketers to combine images with the text that appear in the ads above regular image search results.
Until now, search ads that appeared in Google Images were for the most part all text (in some cases, the ads had product-specific images). But the new ad formats will allow marketers to include visual images for anything they want: a picture of an alluring beach for a travel agent selling Hawaiian vacation packages, for instance.
The change in format means that only two ads will now appear above Image Search results, instead of the three ads that were previously displayed. But Google executives said they expect the image-based ads to sell for a premium.
The new ad format is part of a broader overhaul to Google Image Search announced on Monday, that includes the most significant redesign of the product’s user interface since it was launched in 2001.
Microsoft’s Mehdi sees Bing in the black
Microsoft’s Bing search engine hasn’t put a dent in Google’s mastery of the market yet, but executive Yusuf Mehdi thinks it could do so soon, once the search ad partnership with Yahoo is completed.
Bing might even make some money eventually, he suggested in an interview today, once advertisers start to see it as a creditable alternative to Google.
But how long does it have to achieve those goals? Microsoft has lost more than $5 billion in its online business in the last four years. The company keeps saying it is a long-term project, but surely it has to see results soon.
Mehdi’s answer to that question in the clip below, and his thoughts on the delayed relaunch of the MSN portal, from an interview at Bing’s headquarters in Bellevue, Washington today.
Google’s Fast Flip Trick
Google wants its online news site to feel more like the good old print product.
And the company is prepared to pay for it.
Google took the wraps off of Fast Flip on Monday, a slick online tool that lets readers flip through articles from newspapers and magazines as quickly and effortlessly as if they were turning the pages of a magazine.
The company said it will share advertising revenue with the 30 publishers whose content is currently available on Fast Flip, including the New York Times, the Washington Post and Newsweek.
Obsessive Google-watchers may recall that rumors of this product emerged back in June.
But the company officially released Fast Flip on Monday, making it available on Google Labs, the company’s outlet for products that are still in the testing phase.
Google is essentially hosting images of the first page of various articles from its partner publishers. A Web surfer can browse by topic or news source and scroll through fast-loading snapshots of all the relevant articles. There’s a “recommended” section that aggregates the most popular articles thanks to a new recommendation tool that Google has added (watch out Digg!).
Unfortunately, Google has discontinued Fast Flip… which sucks because I used to user it every day.
I also used to recommend Fast Flip a lot. My organization teaches speed reading classes and we used to recommend using Fast Flip as a great way to read faster online. Now that the app is gone, we’re going to create a new one, that is even better. We’ll post updates on it here: http://www.irisreading.com/fastflip
Meebo launches new ads with 30-second guarantee
Convincing marketers to try a new type of Internet ad format isn’t easy, especially during a time when ad budgets are getting cut.
But Meebo has come up with a novel way to entice advertisers to take the plunge: the company will guarantee that Web surfers spend at least 30 seconds interacting with ads that run in its new advertising units.
The new ads are integrated within the Meebo real time communications service, which provides instant messaging and link-sharing capabilities on more than 40 Web sites including myYearbook, CafeMom and Current TV.
Meebo said up to 85 Web sites have signed up to go live with the service.
At first glance, Meebo’s new ads don’t look like that big of a deal – the ad is essentially a small icon within the Meebo toolbar that’s parked at the bottom of a partner site’s Web page. But a click on the icon expands into an “overlay” of up to 900×400 pixels, which can feature rich media, such as video and games.
Meebo Chief Operating Officer Martin Green says that user engagement with the new ads is much better than with traditional online display ads, because viewers would need to click on the tab to call up the ad.
“We have done this in testing and in the last couple of months we get on average over a minute of time spent, which is a massive amount of time with advertisers’ content,” said Green. “Part of the reason is you only get people who are interested in checking it out.”
Looks very promising, like a more sophisticated Google ad. If this takes off Meebo could be sitting on gold as big G is always on the look out for interesting concepts.
Yahoo and Google spice up ad offerings
The battle to build the best Internet search engine gets plenty of press.
But with the economy in the doldrums, the Internet giants are also engaged in a heated race to improve their advertising offerings.
Yahoo and Google, the top two search sites in the US, are rolling out new features and services designed to grab a bigger slice of the advertising dollars that businesses spend to hawk their wares.
On Monday, Yahoo unveiled a self-serve display advertising service which allows companies to create their own online ads.
The service is aimed at small, local businesses that aren’t served by the Yahoo sales team and the account managers that cater to larger advertisers. According to Yahoo, businesses using the new self-serve ad product can choose from more than 800 display ad templates to run across the Yahoo network of Web sites, and opt to pay on a per click or a per impression basis.
Meanwhile, Google plans to begin testing a new type of ad unit to better showcase products in the sponsored links that appear alongside search results.
According to an email that Google sent out to advertisers, posted on blogoscoped.com, the ads will feature product pricing and a product image.
with which keywords can we see examples of these new ad units?
Google makes a TV ad
Google built its business on the advertising shift from traditional media, like TV and newspapers, to the Internet.
But as Google strives to jump-start its fledgling Chrome Web browser, the company apparently still sees value in good old-fashioned mediums like broadcast television.
Google said it would begin advertising Chrome on various TV networks beginning this weekend.
The TV spot will raise awareness of its browser, Google explained in a posting on its blog on Friday, “and also help us better understand how television can supplement our other online media campaigns.”
The Chrome browser, which Google released last year, is a distant No.4 among Web browsers with a scant 1.4 percent market share in April, according to Net Applications. Microsoft’s Internet Explorer rules the roost with a 66.1 percent share, followed by the Firefox browser and Apple’s Safari browser, respectively.
The Chrome TV ad, which Google said was made by a team of its employees in Japan, is a whimsical stop-motion-like animation in which the Chrome logo bounces around a box of woodblocks.
The 30-second ad, which has music but no spoken words, finishes with the simple message “Install Google Chrome.”
I didn’t get it. Stick to an ad on http://www.google.com. That I got and installed it.
Google funds photo advertising start-up
Google may not be buying companies as often as it once did, but that’s not stopping it from doling out funds to promising start-ups.
On Wednesday, Mountain View, California-based Pixazza, a developer of photo-based online ad technology, said Google was among the group of investors that plunked down $5.75 million in Series A funding. Pixazza’s technology lets Web surfers click on portions of online images to get more information, say the brand and price of the shoes that a celebrity is wearing in a photo.
“Google’s investment underscores the innovative and promising nature of Pixazza’s new advertising technology,” Pixazza said in a statement announcing the deal.
Google’s investment comes as the search giant has slowed its pace of outright acquisitions, and as the company prepares a new in-house venture capital division called Google Ventures.
Other investors in the funding round include August Capital and CMEA Capital. And Pixazza listed angel investor Ron Conway, former eBay COO Maynard Webb, and Facebook CFO Gideon Yu among its backers.
Pixzazza says its “distributed workforce of product experts” can match products in photos with its network of advertisers, and claims it will do for images what Google’s AdSense advertising network did for Web pages.
Blue Sky for Baidu?
The dreams of Internet moonshot stocks have not disappeared amid the global economic slowdown.
Take Baidu, the No.1 Internet firm in China, which was bequeathed a lofty $432-a-share valuation by Deutsche Bank on Tuesday under a so-called “blue-sky scenario.”
That would be quite a bit above Baidu’s $186.50 opening price on Tuesday, but Deutsche Bank analyst Alan Hellawell points out in a note initiating coverage on Baidu that the stock has traded upwards of $380 in the past 52 weeks and that Baidu’s market cap still pales compared to Google’s.
While Baidu’s revenue recently took a hit after the company removed paid listings from unlicensed medical firms, Hellawell believes the headwinds pressuring the stock have now largely subsided.
Citing the spread of Internet usage among Chinese citizens, and the increasing popularity of online advertising by Chinese small and medium businesses, Hellawell reckons that Baidu could ride the same wave that once propelled Google’s stock to more than $700 a share.
“We expect Baidu to largely follow Google’s business model evolution and growth trajectory,” Hellawell said.
The $432 hypothetical valuation for Baidu’s stock assumes various best-case scenarios over the next three years, including a 48 percent growth in Chinese online advertisers instead of the 19 percent growth rate used in Deutsche Bank’s base scenario.
BIDU is always a bubble to bust the fire jumpers, satisfying their dreams with their blood.
Even if Baidu share could reach $432 someday, BIDU tends to crash hard. Those who pushed most (buy on in peak) suffer most.
Just like San Lu, Baidu plays evil. Chinese gov would erase evil firms easily. A little while ago, San Lu was the best and largest baby milk power provider in China, now dissappeared.
