Crenk

For a while now I have been running Adphilia and we are only a small site representation company that is slowly growing. We have spent a lot of time trying to source the right Advertising server to meet our needs, but we still haven’t been able to find the right one in my mind. We have toyed with using free ad servers like OpenX or Google, as well as corporate ad servers like Right Media or Doubleclick. This is a post which just outlines what we have found within the company.

Free Ad Servers:

Open X - OpenX is an amazing piece of software that allows medium and large website to control their inventory. It is cost effective because the software is free, however you need to think about the implications advertising will have on your hosting servers, because huge amounts of ad serving can mean very large bandwidth costs. I also find OpenX a little hard to understand when you are first using the serving, plus I’m sure the larger your sites are the more complicated it becomes.

Google Ad Manager - Google Ad manager is a great product but it is built specifically for small publishers. It has a great design and easy to use. The first issue is that you can only use this ad server for small sites, because it is not compatible with any larger ad servers, and you have to put ad code straight into the header of your site. Additionally, I really don’t like the fact that when you deliver your first campaign you have to set it all up the day before it is allowed to be start. Small but bloody annoying.

Corporate Ad Servers:

Zedo - Zedo is very professional company with some great customer service. However, with them we got caught on the first hurdle, cause they were very expensive compared to all the other companies. Possibly, this is due to the great customer service and the results they can bring your sites. However, if you don’t have a great sales team to match what they can offer, there isnt too much point.

DoubleClick - This company just amazes me. Doubleclick seems to be a mish mash of several individual sections of software that has been mashed into one tool. Instead of Trafficking, reporting, billing and account details all in one sections, they seem to have segmented them, thus making it very untidy. However, they are the worlds best ad serving tool and the most used.

Atlas - Atlas, I tried to contact 5 times and they have never even responded to the messages I left. So I didn’t even get past the pricing stage let alone using their service. Typical Microsoft!

After all of these experiments it didn’t really bring me to finding the ad server solution that I was after. Im wanting a piece of software that is easy to understand and us, which doesn’t cost the earth, preferably free and web based. Does anyone know of a solution that I should try?

Well im sure that everyone has already heard, but if not Microsoft has today withdrawn their proposal to acquire Yahoo! Yahoo have issued a press release and Roy Bostock, Chairman of Yahoo! Inc., issued the following statement today in response to Microsoft Corporation’s announcement that it has withdrawn its proposal to acquire Yahoo!:

“We remain focused on maximizing shareholder value and pursuing strategic opportunities that position Yahoo! for success and leadership in its markets. From the beginning of this process, our independent board and our management have been steadfast in our belief that Microsoft’s offer undervalued the company and we are pleased that so many of our shareholders joined us in expressing that view. Yahoo! is profitable, growing, and executing well on its strategic plan to capture the large opportunities in the relatively young online advertising market. Our solid results for the first quarter of 2008 and increased full year 2008 operating cash flow outlook reflect the progress the company is making. Today, Yahoo! has:

– a refined strategic focus to drive enhanced volume and yield;

– reorganized to focus its efforts on its most promising products and services;

– invested in innovations designed to revolutionize display advertising and facilitate closing the competitive gap in search; and

– enhanced expense and resource management to support improved profitability.”

Here are also some of the thoughts from around the web:

• Techcrunch
• Venturebeat
• News.com
• Centernetworks

It has been reported this morning that Farecast has been acquired by Microsoft for $115 million. Farecast is a travel prediction engine which attempts to help you find the most ideal time to purchase tickets.

This is a good return for investors into Farecast, because they received approx 5 times their investment.

Microsoft has already openly stated that they will integrate the Farecast technology into MSN Travel. Farecast had a very good technology and im sure there must have been more companies interested in Farecast, because I cant see that Microsoft would pay $115 million just to put the technology into their travel section. Must have been a strategic move to keep the technology out of reach of their competitors.

The soap opera that is Microsoft bid for Yahoo is continuing. Firstly it is reported by the WSJ that Yahoo is closing in on a merger with AOL. If the deal goes through, the two companies would combine their web and internet based services. Yahoo! would reportedly use some of the revenue from a merger with Time Warner/AOL to buy back a whole bunch of stock which woudl help the company fend off any further unwanted advances from Microsoft.

While at the same time it is reported that Yahoo has begun testing out Search Ads from Google. Then Microsoft hit back with the following statement about the search testing:

From Brad Smith, Microsoft’s General Counsel:

“Any definitive agreement between Yahoo! and Google would consolidate over 90% of the search advertising market in Google’s hands. This would make the market far less competitive, in sharp contrast to our own proposal to acquire Yahoo! We will assess closely all of our options. Our proposal remains the only alternative put forward that offers Yahoo! shareholders full and fair value for their shares, gives every shareholder a vote on the future of the company, and enhances choice for content creators, advertisers, and consumers.”

Well, what can I see happening? I expect that AOL and Yahoo will potentially merge, but this it might happen in about 6 months time. In terms of search advertising between Google and Yahoo, im sure this cant continue because of the amount of marketshare they will have between them. Finally, Microsoft have no chance of purchasing Yahoo, I cant see it happening because Yahoo shareholders and directors would have already agreed if there was something that was going to happen.

More news from around the world.

It has been announced that AT&T will join forces with Microsoft and use the Microsoft Surface. The announcement was made yesterday at the 5th Annual AT&T Press Luncheon during CTIA.

The Microsoft Surface features a 30″ multi touch screen which can detect any phones on its surface. With AT&T the Surface will have the capabilities of dragging videos, photos, ring tones, songs and dropping them into the phones. The Surface is a great concept but I cant see this making too much difference in phone shops throughout the USA. It would be much better if it could be used in restaurants. However, that being said im sure this is a nice additional revenue stream for Microsoft.

It has been a busy day in the race for Yahoo. Rupert Murdoch has officially stated that News Corp is going to fight Microsoft for Yahoo, and on the flip side the Time Warner Chief Executive Jeffrey Bewkes has said that Time Warner is open for a deal on AOL.

Talking to investors at the annual Bear Stearns Media Conference, Murdoch said that “We’re not going to get into a fight with Microsoft, which has a lot more money than us.” Murdoch also gave support to Google as FIM’s ad provider: “We’re very happy to be in the Google camp. They sell our search advertising and pay us well for it.”

Bewkes however acknowledged weakness in the AOL business and told the Bear Stearns media conference Tuesday that Time Warner was open to combining AOL with another company “whatever configuration makes it the strongest and the most valuable.” This being said, AOL booked $5.2 billion in revenue in 2007 with AOL properties receiving 112 million visitors a month.

So as the race heats up, who is actually putting in formal bids for Yahoo and will there be a merger, takeover, or nothing?? Only time will tell.

The new version of Live Messenger is out today and I just upgraded this morning. I havent had a full chance to go through the program and see what has been added and upgraded compared to the last version. However, on first glance the header bar and chat windows has completely change complexion and now adheres to the Live overall style.

If you know more about the changes in this new version please post them in the comments section, and im sure to add it to the post.

News just in that Microsoft is to bid $31 per share to Yahoo’s board of directors to purchase the company. Release below. I’ll update this post with analysis in a bit, and we’ll have a separate post linked from this when the conference call starts.

In the last few days I have been reading some great articles over at RWW on the music industry, where it is headed and how Apple could potentially lose its dominance. These articles have fueled great debates on the RWW site and here is my take on the whole music industry.

Having the Complete Package

Josh wrote a great article at RWW that basically talked about Apple and how they are slowly coming under fire from Amazon and Zune. I think the situation is very straight forward until someone really tries to shake up the market!

Apple currently has 70% of the portable music player market and approx 85% of the music download market. Apple additionally has a very strong brand awareness and loyalty. Apple are very smart at what they do and for companies who only offer part of their package, it will be very difficult for them to compete and actually grab any market presence. Im sure we will see companies like Amazon attempt to attack parts of the music market but if they succeed in any particular area (such as cut pricing of downloads and DRM free downloads), then Apple will just calculate the right times to cover the advances and offer equal services. At the end of the day Apple knows that they have brand loyalty like no other and services such as Amazon Mp3 in the long run will only help them sell more iPods or Macs, because these people who download have to put their music somewhere.

In terms of Zune they have been receiving some good reviews for their new product, however this is Microsoft we are talking about. Microsoft has long been serial monopolists and Zune is not going to change that fact. Apple have of course AAC files that can only be played on iPods and Microsoft have exactly the same with the Zune.

At present no one can challenge Apples dominance and I dont think anyone will challenge them for at least another 5 years. Microsoft with Zune have just launched a product and service exactly the same as Apple did years ago with the iPod and iTunes, there is no difference to me. Amazon however, have launched a service that was need, a service that offers DRM free music not via subscription and via a cut price. Amazon hit a small gap in the market that was needed, but does this mean they will get any where near iTunes? No chance in hell!!

Future of DRM

I predict that 2008 will be the year that all the big 4 (Sony BMG, Universal, Warner and EMI) start selling DRM free music more openly. Amazon has Warner on the books and iTunes has EMI already signed up with Warner to come on board very soon.

In 2007 there have been lots of experiments with the music business model, such as Radiohead and also Amie Street, but have they proved anything? Yes I think they have. The Amie Street business model of offering music low and then prices increase when the track becomes popular has proved so successful that Amazon has bought into the company. Radiohead proved that selling digitally on a website can be just as popular as selling on the huge iTunes.

Conclusions. Overall, I really think customers are willing to pay for good quality music, especially DRM free music that can be transported to any portable music player, but only at the right price! Im still not too sure if we have found the right price yet. This is mainly due to the big 4 wanting to make a good margin on their sales on iTunes, thus prices are currently high. I cant wait to see a service that skips all of the hassels and just offers a simple service that sells good quality mp3s DRM free at a price such as $0.50 per download.

What Needs to Happen to Break the Music Industry

Currently, I am CEO of a company which is entering the music space but focusing on music licensing and distribution. Hypothetically, if I had the resources and money to launch a product in the music industry that would compete with iTunes and Apple, I would do the following.

• Digital music downloads need to have a copyright system in place that actually tracks who the music is sold to and if the music is transported between computers or players it just needs to be unlocked via a password or something similar.
• Offer a DRM free music store in which the music can be transfered to any portable music player
• Offer a reasonable price and optimize the transaction fee the third party takes.
• Then offer other vertical services such as videos, games, ebooks and more.
• Finally, move into horizontal integration, such as a revolutionary portable music player, online and satellite radio stations and many more ideas.

This is the only way I can see someone breaking the Apple dominance and taking at least some share of the music market. If you are a VC and would like to fund my idea, please get in touch with me! haha. I love a challenge!

This has to be the funniest thing i have heard in ages. Microsoft has launched a campaign which states, “they know you’ve got a pirated copy of our software, so register with us and pay a small fee for an official license”???

Basically Microsoft is trying to turn people who are using their software into consumers, which it pretty self explanatory. Microsoft estimates that 35% of the software installed on computers is stolen. Im just not entirely sure why a person who is using pirated software for free would even consider paying. Everyone wants something for free!