Insider Chatter by Donna Bogatin

The future of all varieties of local search will be analyzed, debated and predicted over three days of The Kelsey Group’s Interactive Local Media Conference set for Los Angeles, post-Thanksgiving holiday.

I am a five year, multidisciplinary veteran of the Kelsey local intensives: From academic analyst, to startup entrepreneur, to professional blogger, I have experienced the annual event for interactive local media execs and local search practitioners from all angles and always look forward to the high-level local pow-wows.

This year, I have the pleasure of joining the Kelsey Group analysts on stage to wrap up the three-day local meetup in helping evaluate if we are in the midst of a local revolution, or an evolution.

Local media play AnchorFree, for one, would undoubtedly vote for local revolution, thanks to its ”hotspot media network.”

I met AnchorFree co-founder and CEO David Gorodyansky, and team, at the Ad-Tech conference in New York City earlier this month when the Silicon Valley based startup hosted a Silicon Alley Happy Hour. While many Ad-Tech exhibitors laid claim to the latest and greatest ad network innovations, the AnchorFree value proposition is indeed compelling:

The largest Hotspot media network, representing more than 10,000 Hotspot locations, generating more than 400 million page views through five million user sessions per month. The location-based ad network is a new marketing channel for brand and direct response marketers to deliver interactive, timely and targeted advertisements to laptop and mobile device users when they are away from the home or office.

What is so “revolutionary” about the AnchorFree ad network? In a telephone interview this week, Gorodyansky proudly told me his company can target local ads better than Google and Yahoo! As the leading search engines rely on IP addresses for ad serving precision, both Google and Yahoo work under 30% to 50% margins of error, Gorodyansky indicated.

AnchorFree serves ads “pinpointed to street level location,” Gorodyansky told me. AnchorFree may even be able to target Yahoo local ads better than Yahoo itself; AnchorFree has an ad sales and delivery partnership with the number two search engine:

Advertisers are guaranteed 100% accurate location-based targeting, as AnchorFree’s geo-targeting capabilities are based on the access location of the consumer, and not on the less reliable ISP data.

The AnchorFree sales pitch: “We connect advertisers with millions of consumers in a captive, persistent manner that is highly measurable and geo-targeted to users’ exact locations. Any business, from coffee shops and restaurants to hotels, airports and malls, can leverage the AnchorFree network to offer their patrons free Internet access while generating new revenues with no financial investments required.”

AnchorFree aims to build a nationwide broadband advertising network providing 1-to-1 connections with attentive consumers, Gorodyansky told me. Whats more, the out-of-home laptop and wireless device users that engage with AnchorFree’s free-to-the-consumer, ad-supported hotspot network, are highly desirable to brand and direct marketers, Gorodyansky indicated.

Brands currently running across the AnchorFree network include American Express, AirTran, Circuit City, Clorox, Ford…AnchorFree commands CPMs of about $12.50.

While Gorodyyansky hails the local advertising appeal of its service for the media business, AnchorFree also sees its mission as revolutionary for the world at large:

The company enables a grass roots movement of thousands of locations around the world that come together into the largest public, ad-supported Wi-Fi community.

AnchorFree’s hotspot concept does sound “hot.” The hot local space nevertheless has lots of companies vying for “revolutionary” honors.

Dozens of other prospectively “hot” local plays are unbdoubtedly gearing up to make their own best advertising and/or technology cases to the hundreds of local decision makers set to convene in Los Angeles from November 28 to 30!

SEE YOU THERE? BE SURE TO STAY TO THE VERY END! CONTACT DONNA BOGATIN

MORE INSIDER CHATTER CEO INTERVIEWS: MerchantCircle CEO Aims To Disrupt Local Advertising $39 billion Spend: INTERVIEW AND Stepan Pachikov: EverNote Web 2.0 Perfect Mobile Storm To Hit in 2008, INTERVIEW

UPDATE:  CBS To AnchorFree WiFi: WE Own The Ad Billboard, Online AND Off

” Advertising will pay the way” on the Internet, Viacom and CBS Chairman Sumner Redstone reconfirmed today at a New York City conference. At the same time, the New York Times attested to the power of ad-supported online media, at another NYC conference.

Nevertheless, NY Times $10 million Free News Bet NOT a Sure Thing I headlined when the old gray lady knocked down its pay wall. The GM of NYTimes.com suggested same this morning, during an Ad-Tech panel on “Publishing in the Digital Age, How Companies Are Extending Their Reach.”

Vivian Schiller began her presentation by sharing just how much the venerable “dead tree media” has extended its reach online since it dropped its fee plans for featured opinion columnists and the archives: Search referral traffic has increased 133%, Schiller said.

Nevertheless, “it is too early to declare victory,” Schiller advised. In other words, the content must be free game–at the cost of $10 million in yearly subscription revenues–is NOT a slam dunk.

Schiller remains bullish, however. Under the TimesSelect regime (which represented about 10% of content), direct navigation represented approximately 55% of NYTimes.com traffic, search referrals about 45%. Since opening up “opinion and archives,” search referral traffic has “tripled, quadrupled,” Schiller said.

For the NYTimes.com, online subscriptions and direct navigation is akin to “appointment viewing”; Share of such traffic has decreased, as search referral traffic increased.

Schiller extolled the New York Times brand and the quality of audience it delivers to its advertisers. During the Q & A, I discussed how overall audience quality is impacted by the new influx of search referred traffic.

I asked Schiller:

1) As search referred traffic outpaces direct navigation, how will advertisers react?

2) Are CPMs lower for search referred traffic versus direct navigation?

3) How does NYTimes.com deal with fickle search referred visitors who sometimes don’t even finish the clicked-on story, let alone browse other areas of the site?

NYTimes.com advertisers are pleased with the greater access to a higher number of monthly uniques representing new, diverse demographics, Schiller indicated. Moreover, CPMs for advertising at NYTimes.com are not based on source of visitor origination, so CPM dilution is not a concern, according to Schiller.

Schiller acknowledged that average, overall time spent at NYTImes.com will decrease as the percentage of search referred traffic grows. The site is subject to the typical 80-20 rule, whereby a small number of loyal users drive a large portion of revenues, Schiller indicated.

BUT, if it is too early for the New York Times to “declare victory” on the “opening up” of NYTimes.com, it may also be premature for the company to conclude that there will no negative impact on CPMs going forward. After all, while the New York Times may not break out traffic by source for ad pricing, advertisers may very well judge the overall audience quality inferior at some point, and subsequently put downward pricing pressure on NYTimes.com CPMs.

In analyzing the New York Time’s future CPM prospects when it announced its farewell to TimesSelect subscriptions, I underscored that as page view increases will be derived from fleeting search engine and link-fueled visitors, it is unlikely that NYTimes.com would be able to continue to command high CPMS as it has been accustomed to with its dedicated readership.

Rupert Murdoch did a silmilar analysis in reporting to Wall Street yesterday on the future prospects for WSJ.com:

The wsj.com, making it free, we are examining the possibilities of doing that. There are a lot of pros and cons. We passed 1 million people now who are paying for it, and getting very, very high cost per thousand for advertising.

On the other hand, if that was to jump to 10 million or 20 million people around the world, it could be a wonderful thing for the brand. We would be selling the ads at a lower cost per thousand but I think we’d be in front.

NYTimes.com has already bet that it will be in front.

MORE AD-TECH EXCLUSIVES: NBC STILL Playing YouTube Games with Google: Ad-Tech Report and IAB Blasts FTC: Cookie Police Threaten $20 billion Internet Ad Economy, Ad-Tech Report

PLUS: YES! Facebook IS Scarier Than Google! AND WSJ.com Beware: Digg Users Plot Paywall Hack

CONTACT DONNA BOGATIN

As Google comes under increasing regulatory rhetoric fire regarding the consumer privacy implications of its desired DoubleClick acquisition, the online ad industry trade association (of which Google is an important  member) is stepping up its ANTI-regulatory rhetoric. 

It is the best of times, it is the worst of times, so declared the leader of the leading voice of the Interactive Advertising Industry, Randall Rothenberg, IAB CEO, at Ad-Tech in New York City this morning.

The IAB assembled a power panel to discuss “The State of the Industry” and prefaced the debate by warning the audience of interactive marketers, agencies and professionals that their livelihoods are at stake, (NO) thanks to the Federal Trade Commission (FTC).

How so? Despite booming prospects for the online ad industry–$20 billion yearly revenues projected only 13 years after the introduction of the Netscape browser, Rothenberg boasted, nearly a third in importance to the TV ad business—,the online ad party could come to a schreeching halt, if the FTC and “anti-consumer groups” have their way, Rothenberg warned, implying consumer advocates are masquerading as evil doers.

Rothenberg was incredulous, indicating the FTC hearings last week had the temerity to surface the view that time is of the essence in acting on behalf of consumers because ”the time for fact-finding is over,” the FTC believes.

The FTC itself is incredulous, with Commissioner Jon Leibowitz personally coming to the defense of Web consumers: “I am concerned when my personal information is sold to third parties and when my online movements are tracked across several Websites.”

“People should have dominion over their computers. We really mean it,” Leibowitz underscored and THAT is what the IAB is afraid of, that the FTC is not paying lip service to real consumer privacy issues, but will actually take meaningful action to protect users online. In other IAB words, REGULATE.

Cookies are a prime target of the the FTC’s regulatory investigations, much to the chagrin of the IAB and the powerful member companies it represents: Google, Yahoo, Microsoft…

Rothenberg is on an IAB mission to educate the FTC, so-called “anti-consumer groups” and consumers themselves on how, according to IAB member companies, the Web’s cookie technology is not only as harmless as fresh-baked brownies, but the (not so) little engine that could, IS fueling a multi-billion dollar democratic Internet economy in which EVERYONE can be the next Google!

During the Q & A, I noted that State’s Attorney Generals are also concerned about protecting users online, the underage ones.

My queston to the panel: Arianna Huffington indicated comments are moderated at HuffingtonPost to insure a safe and civil environment. In contrast, anything goes at UGC sites MySpace and YouTube. Do you share IAB’s position that regulatory oversight is necessarily a threat to your businesses, or do you look to the government to help build your credibilty with the public?

Rothenberg rephrased my question, “So how do you feel about regulation?”

Fox Interactive Media Chief Revenue Officer, Michael Barrett, gave a thoughtful response underscoring both the MySpace safeguards in place to protect minors and the ongoing education efforts necessary to promote best online practices for the youngest MySpacers. MySpace is open to constructive input from the government, Barrett suggested, while nevetheless indicating neither technology or regulation are foolproof panaceas.

Moreover, user concerns online are not merely a function of the age of consumers, as I report and analyze in: Savvy Web Consumers Delete Cookies, Big Time.

Blasting the FTC may make for good press, but the IAB can not ignore a significant user allergy to cookies!

After all, IAB member comScore has been warning about the real world cookie deletion problem for many a months:

About 3 in every 10 Internet users delete their cookies in a month, with an average deletion frequency of about 4 times per month.

Consumer cookie deletion is rampant, IAB dreaded FTC “regulation,” or not. It is unlikely that a self-serving industry “education” program will dissuade one-third of Web consumers to change their behavior, in favor of the multi-billion dollar advertising economy.

ALSO: Facebook Puts Freeloader Users On Sale To Highest Bidders! and Facebook To Users: We Know How YOU Live, Work, Play, Vote…

PLUS: YES! Facebook IS Scarier Than Google!

CONTACT DONNA BOGATIN

NBC has a hate-love-hate relationship with YouTube, I noted to NBC Universal Senior VP, Digital Distribution, Ron Lamprecht, at the Ad-Tech conference underway in New York City. Google’s Director of TV Ads, Michael Steib, was at his side.

The two execs shared a stage for a panel entitled “Television 3.0,” moderated by Greg Baumann, Editor, Television Week.

During the Q & A, I underscored the irony of a Television Week editor opening a panel on the future of television by showing a “clip” about TV, running on YouTube! I also asked Lamprecht what NBC intends to do about the rampant unauthorized posting of copyright NBC materials at YouTube.

My Question: NBC has deleted its YouTube channel while semi-launching its would be YouTube killer. NBC content nevertheless continues to boom at YouTube. What will NBC do about the ongoing copyright infringement?

1) Join in the Google Video ID program OR

2) Join in Viacom’s billion dollar YouTube lawsuit?

Lamprecht’s answer: We launched Hulu.com. We continue to talk with Google, Michael and I just spoke before the panel (Google’s TV Ads point man concurred).

I saw, and heard over the open mikes, the two Google and NBC execs joking together as well, before the discussion got underway.  During the panel, NBC’s digital distribution point man even gave Google the thumbs up, underscoring how the tehchnology of the company that wants to control all the world’s advertising, even the broadcast kind, will be indispensable to television advertisers going forward. Robert Leverone, VP Television, Dow Jones, chimed in that partnering is key.

The NBC-Google co-panelist love fest today at Ad-Tech contrasts starkly with the NBC-Google almost showdown I witnessed at the OMMA conference in NYC in September.

As I recount in NBC’s Defense Against YouTube IP Abuse? Carrot, NOT Stick: OMMA Report George Kliavkoff, Chief Digital Officer for NBC Universal, twice lobbed veiled, but pointed, jabs at Google for its scant concern for protecting the rights of content creators at its YouTube juggernaut. HE was sharing the stage with Google’s Director of Media Platforms, sitting side-by-side with Eileen Naughton.

During the OMMA Q & A, I asked Kliavkoff: “You seem to have twice indicated NBC’s unhappiness with Google’s DMCA business model. Isn’t it time for NBC to give Viacom some real support by also suing YouTube for copyright infringement?”

Kliavkoff responded that NBC belives in IP “carrots, not sticks.”

Just weeks later, NBC pulled its YouTube channel. Lamprecht didn’t say today if THAT (anti) YouTube move was the carrot, or the stick, talking!

MORE: Tom Curley AP Crusade: Google AdSense Lawsuit Near? Thanks to Attributor and Hulu.com Debuts: Worth the Wait and  NBC on Why Hulu.com IS a YouTube Killer: OMMA Report

PLUS: Google To World: Give YouTube Your Videos, NOW! and NBC Still Booming on YouTube: Google Lawsuit Next? and OMMA Advertising Cat Fight? Google’s Media Chief Gets Defensive

CONTACT DONNA BOGATIN

In Google AdSense: Dawn of the Web’s Bloopers last week, I noted that big, bad Google AdSense advertising adjacencies are not only good for laughs, but they signal that contextual advertising is NOT a “solved problem,” not even for number one Google.

I also mused, as AdTech takes New York City by storm this week, perhaps there are some ad network disruptors in store ready to deliver that ever elusive Google “killer.”

Out of the Ad-Tech gate, a “new ad targeting platform” is indeed promised. Rather than seeking to “kill” Google, however, it is happily piggybacking on it: BuzzLogic is but the latest to jump on the lets help Google sell some more AdWords bandwagon.

In Local Ad Sales War: Why Google is a Guaranteed Winner I analyze how the Googleplex triumphs with NO local ad sales pain, but LOTS of AdWords gain as venture capitalists and corporations eagerly pick up the Google local sales slack, not only on behalf of Google, but even in competition with themselves, and often at the expense of their own SMB clients!

BuzzLogic’s AdSense rally is particularly surprising as the ”sales pitch” for their new service disses AdSense, big time:

Online advertising is a big money maker and advertisers are spending $19 billion online alone. But, these ads have not provided the return anticipated, behavioral and contextual adverising have not converted to make the spend worthwhile? Money aside, there are other inefficiencies, including metrics and measurement that further complicate matters. Throw in social media, and you end up with an advertiisng nightmare.

REALLY? If Google AdSense is such a “nightmare,” how is it that GOOG is doing so damn good!

BuzzLogic may know why!:

The advertising nightmare has not escaped the big players–Google, Yahoo and AOL are all looking for the magic bullet, as noted by recent acquisitions of Blue Lithium and Tacoda and testing around cost-per-action adversiing models. So, what does this mean for advertisers looking to capitalize on online audiences?

BuzzLogic has a “magic bullet” of its own! Enter “BuzzLogic Ad Targeting.”

According to the company, “Ad Targeting” enables advertisers to isolate influential blog and social media conversations occuring around products, brands and issues.” BuzzLogic promises advertisers can then ”immediately target ad campaigns into the online conversations shaping consumer perception and buying behavior.”

HOW SO? By unleashing Google AdSense into the blogosphere, enhanced by “site-level campaign targeting.” 

While BuzzLogic’s “Ad Targeting” system results in Google AdSense decorating blogs same as they have long done, CEO Rob Crumpler hails ”key benefits” realized during the private beta, including:

Increased performance–in some cases more than two times higher the conversion rate–when compared to other ad optimization approaches.

Crumpler also boasts BuzzLogic is “helping to propel the industry forward by surfacing relevant and influential content online.”

Blogger Greg Sterling, of Screenwerk blog fame, concurrs: Cited as a reference in BuzzLogic’s official press release, on behalf of “Sterling Market Intelligence,” Sterling assures:

Online conversations, including blogs, are gaining more and more sway over consumer purchase decisions. BuzzLogic technology is important because it allows marketers to see much more clearly the particular blogs and conversations that represent the actual sources of influence shaping those consumer perceptions.

Nevertheless BuzzLogic’s Crumpler himself underscores: “The online advertising industry garners billions of dollars, yet the intelligence around how to deliver the right ad to the right consumer has a long way to go.”

YES, even as the BuzzLogic “site-level campaign targeting” for Google’s AdSense debuts!

ALSO: Qmecom Mass Personalized Video Ad Platform: Yahoo SmartAds, Digitas Beware, INTERVIEW and Attributor Launch Blasts AdSense Pirating: Google Beware and Tom Curley AP Crusade: Google AdSense Lawsuit Near? Thanks to Attributor

PLUS: IAC Sells Ask.com Short? $3.5 billion Google Deal

CONTACT DONNA BOGATIN