Posts by David Card (bio)

David Card | May 16, 2008, 08:10 AM
Second-Day Thoughts on CBS-CNET

I'm not quite as bearish on CBS-CNET as colleague Barry Parr. Barry's critiques of CNET ring true -- they're a former leading online media innovator that still has some good content, but has fallen behind on many of the new trends in online media distribution and networking. And Barry says "CBS needs more distribution and network power and fewer content businesses," riffing off his analysis in this thoughtful Jupiter report.

But I'd argue that, while content and distribution are separate businesses, they needn't be separate companies. And as Barry points out, CBS' roots are as a distributor. The thing is, networks aren't just distribution. They're audience aggregation and ad sales. And, especially for premium advertising, he who owns the page -- really, he who owns the audience -- keeps most of the ad dollars. (Barry will correctly say that, although I can talk a good game on 21st century networks, I'm still too fond of old-school portals.)

So if CBS and CNET can actually figure out how to sell ads across what is now a more diverse audience in a broader variety of contexts, they might have something. CNET adds tech, games, and a couple of weak lifestyle/entertainment properties to CBS' TV promotional site, sports, last.fm, and a weak online news offering.

The result is a hodgpodge. It's not a general-purpose network or portal yet, and it doesn't own any verticals, though it's strong in tech and sports. I still believe in synergy, and I see some cross-promotion potential in sports, tech, and games (young males, anyone?). And of course, bulking up in digital could help the folks running the thing get attention, focus, and resources from a media conglomerate that's weighted towards slow-growth markets like broadcast TV, book publishing, radio, and outdoor.

Some ad buyers seem to like the combo, or are at least being very polite, according to Paid Content.

David Card | May 14, 2008, 07:07 PM
Signs of the End of Western Civilization, Part CCC

From a PR email: "We’d love to see a post of it on your site for feature and/or preview. The show could best be described as “The Darwin Awards meets Faces of Death,” telling the true stories of actual deaths and recreating them through awesome comic-book style graphics, acting, CGI, and colorful narration....If you do feature the show, can you please send us a link?"

Should I send 'em this link? Do they bill their client by "blogger" column-inch? Do they bill if I don't mention the show's name? Or the network? Oh yes, it's a real network.

David Card | May 14, 2008, 01:25 PM
Online Ad Forecasting Poll

It's online ad forecasting season, and we really would like Jupiter clients input. The survey on our site is too small to be useful -- so I'm not posting any results except to say it looks mighty bullish to me (a plurality says 25% growth or better), and the results otherwise are all over the map. So come on, Jupiter clients, let your voice be heard.

David Card | May 14, 2008, 09:38 AM
What Happens if a Story Breaks, but Nobody PRs It?

YouTube's announcement of rudimentary buzz-targeting -- that is, placing its ad overlays on videos as they become popular -- strikes me as at least the most important tech news that broke yesterday. I mean, c'mon, Carl Icahn? Craigslist lawsuits? Yet, most of the tech blogs, and all of MSM have nothing on it as of this morning.

Cnet re-wrote the press release early
Alleyinsider had some actual analysis, and had it early
Mediapost has a decent story, you know, with people they actually called up, today

Gosh, I guess the old PR roadshow trick -- which Google disdains -- still sets the news agenda. Whoulda thunk?

David Card | May 09, 2008, 12:18 PM
Google, Yahoo Remain Favorite Brands Online

Google's nosing ahead of Yahoo as the top online brand, according to a Jupiter consumer survey. But the kids like the social media.

The question asked respondents to pick their top two favorites. Clients can check out the data on Quantify, and compare it with the results last June.

David Card | May 06, 2008, 09:30 PM
Why Sync, Indeed?

I like this post by Microsoft's Mesh team, too. It makes a great case for "fat client" personalized UI engines that manipulate data that is temporarily stored locally. It seems that locating that data in the cloud would solve a lot of the sync problems created by multiple local data stores. Yes, in some ways, syncing is a problem, not a solution.

I think it'll be a long time (make that "never") before cloud computing does great UI (voice reco? gesture-based manipulation? 3D graphical manipulation? hard-coded privacy/identity/authorization?). Have you used a Web app -- other than a browser -- lately? But I'm still waiting for Microsoft to do a decent job of "data mining, indexing and transformations on" local data stores. Have you used Outlook "find" lately? That's one reason why Microsoft has to duke it out with Google, and why Google cares about client-based search (and not browsers or operating systems).

David Card | May 04, 2008, 07:56 PM
How Ya Gonna Stop Google Now, Part II?

Of course, Yahoo needs a strategy for competing with Google, too. Unlike Microsoft, Yahoo is not competing with Google to be the leader in supplying core technology platforms. However it is competing for search ad dollars and users.

More important, Yahoo, like Microsoft, is talking about ad-buying and –selling marketplaces that integrate search and display, and build off of targeting aided by understanding consumer behavior. And, since Yahoo sees its portal homepage and email as key Web starting points, it must ensure that Google’s search doesn’t dilute its homepage influence, and that Yahoo mail and IM ddon’t lose communications share. Oh, and Yahoo offers core mobile and mapping services, has a classifieds business, and needs to do something about YouTube.

So what do we need to hear from Yahoo execs?

- How Yahoo’s as-yet-unproven ability to target ads effectively (thus raising remnant inventory CPMs) will produce higher growth rates in online advertising (it’s promising 25% per year) than Jupiter is forecasting for 2009 and 2010.

- How Yahoo can gain search query share. It has already shown it can earn more profits from Google’s search ad network than from its own. Yahoo needs to prove to its content and communications users that its own search is better than clicking away to Google.com. If it can’t, it can go on collecting revenue-share from Google – assuming no hostile governments call it anticompetitive – but will probably eventually lose query share and thus search revenues.

- But keyword search should also fuel those consumer insights that lead to better targeting. If Yahoo essentially concedes search, does that dilute the effectiveness of its display networks and exchanges? It might not, but advertisers and publishers need to be assured of that.

- And I want to hear Yahoo’s plan for walling off Google in search. How is Yahoo’s display network going to gain share from Google’s contextual AdSense business, and keep AdSense locked into simple text ads? How is it going to gain share versus AOL’s networks? Yahoo has a decent pitch for publishers, but it’s based on a product that isn’t shipping yet, and outside of some newspapers, has few marquee publisher partners.

I’m completely unconvinced that social media technology is air or electricity or whatever other “open” metaphor you like. What I see are two big social networks – MySpace is producing ad revenues and Facebook has all the mindshare about social graphing, whether from advertisers or developers. Even though Yahoo, MSN, and AOL are better equipped, through their direct sales forces and branded content programs, to help advertisers tap into social marketing, it’s Facebook and Google that get the attention. Yahoo showed some social platform demos; where are the marketing programs?

David Card | May 04, 2008, 07:48 PM
So How Ya Gonna Stop Google Now?

Assuming Microsoft doesn’t take another run at Yahoo, what does it do now? I don’t love big mergers, but I understood why Microsoft wanted Yahoo. Yahoo was the best way for Microsoft to:

- Gain share in advertising fast
- Put its search technology in front of a lot more eyeballs
- Try to integrate and scale ad-buying and -selling marketplaces and targeting and tracking technologies across both display and search
- Try to integrate two big bases of communications users, and establish standards in contact and presence management, and possibly unite core identity, authentication and authorization services
- Achieve commanding leads in key online media categories: personal finance, entertainment info, and automotive, and beef up strong positions in news, sports, games, maps, and jobs
- Double down on consumer mobile offerings

All from a profitable company with a huge group of loyal users. Buying AOL, or integrating MySpace or Facebook doesn’t do nearly as much. Hey, Viacom’s market cap is only $25 billion (Disney or Time Warner are worth more than $50 billion). I’m only half-kidding.

As I’ve said too often, this is about Microsoft vs. Google for platform dominance, and all the other Internet and media players are pieces in that game. Google has replaced Microsoft as the most important company in all of IT, as consumer and Internet technologies ripple into enterprise IT and consumer electronics. Search is a more powerful user interface metaphor than Windows, and Google’s APIs and web-based services are starting to attract serious numbers of developers. And as Microsoft CEO Steve Ballmer told the Financial Times over a year ago:

Today, the big phenomenon that we can embrace - the big fat thing for us to think about, embrace, endorse, compete with - is what does ad-funding mean? Whether it is for search, or whether it is for business-services, or whether it’s for other online services, what does that funding mean as a competitive business model and do we embrace it as is? Do we modify it? Do we just compete with it, with more of a transaction or subscription model? But how we deal with that is a Job One issue.

That's why, unlike some observers, I believe Microsoft needs to be in the consumer Internet media business to compete against – and take profits from – its most dangerous threat: Google. Other than Yahoo, what are its options?

- Attempt to wall off Google in search, by winning the display ad platform and network battles. AOL and Facebook would help here, or MySpace.

- Attempt to wall off Google from enterprise IT. I don’t get paid to analyze that industry any more, but I don’t think this requires buying Oracle or SAP. But I don’t see any obvious path to diluting Google’s impact on network services, cloud computing, and the very real threat of a marginalized desktop OS as the source of UI conventions and navigation/interaction APIs.

- Minimize the impact of ad-based IT technologies and services by owning small business computing – small business is where ad-based IT plays out. Intuit would help, as would Adobe.

- Keep Google technologies out of mobile, and off of the TV set. I think it’s too late for Microsoft to do something with Nokia; Microsoft has long struggled with carriers and telcos (so will Google); and what do you think Xbox is for?

See how hard it will be? See why Yahoo, difficult as it might be, at least makes logical sense? We need to hear from Microsoft how it intends to beat or fend off Google post-Yahoo.

David Card | April 30, 2008, 11:23 PM
This Just In: American Idol May Be Fixed

Stoopid judges expose Idol as Quiz Show, 21st century edition. Wotta surprise. And who cares? It's pop entertainment, people.

As Mr. Seacrest anxiously glanced offstage for help, Mr. Jackson, beside Ms. Abdul at the judges’ table, gently prompted her to make comments “just on the first one.” Confused, Ms. Abdul said to Mr. Castro, “I thought you sang twice.” After realizing what had occurred, she then explained that she got her notes mixed up and had meant her comments to be about the next singer, David Cook. But instead of repeating that she thought Mr. Cook had given an uninspired performance, she told him, “You were fantastic.”

David Card | April 30, 2008, 08:36 PM
AOL 1Q08 Ad Revenue Details

Some more details on AOL's ad business after I finally got to listen to Time Warner's 1Q08 earnings call.

Overall advertising was up 1% to $552 million. That's down 11% from Q4. Besides screwing up its sales force, management blamed that result on:
- $19M accounting difference a year ago
- Ad.com's biggest customer, Apollo (aka University of Phoenix) only spent $17M this Q versus $56M a year ago. Apollo generated $250M$215M in revenues for AOL last year.
- It got rid of $10M worth of bounty fees from an unprofitable sponsorship deal with Goldrush
- CPM compression was was "an issue of our own yield management" -- ie they sold too much network inventory instead of premium O&O inventory

Display ad sales on AOL's own properties were down 18% to $191 million. This was blamed mostly on the sales channel conflict between the network ad sales force and the AOL properties sales force, which should be fixed now (though full benefits beyond Q2). Users are flat (relatively good as AOL access business fades) and page views and pages/users were actually up nicely.

Third-party network sales were up 25% to $188 million. If you strip out Apollo and acquisitions, growth was "much higher."

Global search revenues were up 4%. US search was up in the high single digits. AOL.com search was up 89% but that was offset by the decline in AOL access (client software) searching.

Net domestic ex-TAC ad revenue was down 13% to $292 million. That's down 18% from Q4.

So, if you're keeping score, and my calculations are correct, worldwide online ad sales growth for Q1 is looking like this:

Google (ex-TAC)                              $3.75 billion, up 45%
Yahoo (ex-TAC)                              $1.1 billion, up 13%
Microsoft (minimal TAC included)   $619 million, up 39%
AOL (ex $60M-ish of TAC)             $495, down 2%

David Card | April 30, 2008, 08:30 PM
Time Warner Loves Day and Date VoD

A tidbit from Time Warner's earnings call. Warner Bros. et al are very pleased with VoD day and date trials. That is, releasing a movie to VoD at the same time it's released to DVD. (DVD used to have the earlier release window.) So much so it's planning to release "essentially all" its titles that way this year.

Time Warner maintains that DVD sell-through is not affected -- it even claims sell-through is up a bit because there's less competition with used rentals. VoD margins for the studio are in the 60-70% range, while DVD rental margins are 20-30%, it says. So, Blockbuster and Netflix are the only victims.

David Card | April 29, 2008, 11:49 AM
TV Guide Talks Online Video Guide Strategy

PaidContent is wisely wondering about TVGuide.com's future if the proposed merger of TV Guide/Gemstar and Macrovision goes through, especially since Macrovision hinted it might unload the magazine. Meanwhile, among other things, TVGuide.com is attempting to establish itself as the guide to (professional) video content online. There'll be a lot of competition for that role.

Some things TVGuide.com is doing well

- TVGuide.com believes, as I do, that robots alone won't solve the problem. So it has its spiders and algorithms, but it also has a smallish (10 people) staff of editors doing content as well as promotion.
- TVGuide.com is embracing the notion of online networked media, and pursuing syndication via deals and widgets. It's also aggregating content on its site
- This might be controversial, but its editor is also its marketing VP. That makes sense to me for online networked media
- They demo'd a feature that made it pretty easy to create a little widget that creates an auto-refresh search. If you wanted to have constantly updated Justin Timberlake video content on your fansite blog, you could do so

Some things that need work

- It only spiders about 65 cable and broadcast sites for its professional content. It covers music videos but doesn't work with Yahoo, which is the leading site for them. Right this moment, the top video on Yahoo Music (no. 4 on AOL Music) is Mariah Carey's "Touch My Body." A Mariah Carey search result for that tune on TVguide takes you to iTunes. YouTube gets you the right video.
- Because it doesn't have deals with many suppliers, it's a very inconsistent user experience when you "click thru" on content. Sometimes it plays locally; sometimes it carries you off to a site
- You can embed feeds with one click in MyYahoo and iGoogle. But not in Facebook or MySpace, where people actually use widgets. "Open Social support" -- well, that and 5 bucks will get you a cup of coffee at Starbucks
- The advertising syndication strategy is, as we analysts often say, "nascent"
- Notice how I had to give two links for the main site and the online video guide?

Net: strategy on-trend; some execution details TK.

David Card | April 29, 2008, 08:21 AM
You Only Hurt the Ones You Love, Part XIII

What's wrong with this sentence?

The marketing hoax is an attempt by the South Korean electronics company to overcome the commoditization of the television business.

Perhaps this is an attempt at irony; surely it's not an accurate description of LG's marketing strategy. LG is trying to combat TV price declines via design -- in this case, color. And promoting the idea via gimmicky marketing events, which to judge by the story, were largely successful.

If this is what happens when Murdoch takes over and threatens to fire a lot of editors, then I'm not impressed. C'mon guys, you're still my favorite newspaper.

David Card | April 28, 2008, 07:59 PM
Take It Away, Please

Well, it's only day one of NPR's new morning show, The Takeaway, but I'm distinctly underwhelmed. According to coverage in both the Sunday Times and the Journal the new show is an alternative to Morning Edition in major markets like New York and Boston that's supposed to feel fresher, using live co-anchors. Well, it felt like amateur hour today.

The Takeaway debuted at 6AM in New York with dead air. Former Morning Edition host Bob Edwards, himself booted in a youth movement, was supposed to intro, but WNYC botched the feed. The co-anchors don't have any chemistry or rhythm yet and constantly talk over each other. An interview with an ambassador from Zimbabwe -- these things can always be risky -- not only produced the standard non-answers, but the ambassador nipped back at the interviewer and made him look as overmatched as Lesley Stahl trying to smile through her sparring match with Justice Scalia last night on 60 Minutes. Much ballyhooed "interactivity" -- it used to be called talk radio, but no listeners were actually on the air -- sponsored maybe 5 responses during the 6AM hour.

I'm left with my usual attitude towards live news: it's way less efficient at delivering the goods than properly edited programming. Case in point, the local 1-sentence weather update on The Takeaway was "temperature, raining," while it was "temperature, raining, and forecast high temperature" on Morning Edition. Which is semi-live, anyway. I'll give it a week, but if things don't look up, I'm switching over to WNYC AM, where Morning Edition is still on at 6.

David Card | April 25, 2008, 10:43 AM
Keeping Score: 1Q08 Online Ad Growth

Microsoft/MSN showed solid online advertising growth, growing 39% in Q1 worldwide to $619 million. If you subtract aQuantive's ad revenue of $47 million, it still grew 29%. MSN, however, suffered over $200 million in losses.

So, if you're keeping score, and my calculations are correct, worldwide online ad sales growth for Q1 is looking like this:

Google (ex-TAC)                              $3.75 billion, up 45%
Yahoo (ex-TAC)                               $1.1 billion, up 13%
Microsoft (minimal TAC included)    $619 million, up 39%

AOL still to come.

David Card | April 24, 2008, 08:30 AM
Suds

Amusing Journal story about Miller-sponsored Brew Blog that constantly tweaks archrival Anheuser-Busch. Stuffy Anheuser declines to comment, but a beer trade pub is certainly in a snit:

Not so crazy about the blog is (Harry) Schuhmacher, the editor and publisher of Beer Business Daily. Mr. Schuhmacher, who charges $440 a year for his publication, declines to say how many subscribers he has. "I tell Miller you're subsidizing a free publication, and it hurts the trade press," he says. "But they don't care."...Mr. Schuhmacher adds that he writes fewer positive pieces about Miller than he once did because he knows Brew Blog will always publish the same stories.

Ummm, dunno if I would admit that, Harry. You're the one that's supposed to be a real journalist, remember? Not the pajama-clad corporate spy?

DISCLAIMER: I am a former Anheuser-Busch employee. (Summer job as costumed character at Busch Gardens Williamsburg.)

David Card | April 22, 2008, 06:06 PM
Yahoo 1Q08 Earnings Call Highlights

Yahoo showed results slightly above consensus, maintained 08 guidance on revenues, and slightly raised them for cash flow. Since everybody blogs earnings calls real-time, I'll focus on the key highlights and most important "color" comments.

- Advertising revenues for Yahoo's own sites were up 18% to $966M. They were down 7% from Q4.

- Advertising revenues from its network partners were down 7% to $607M. They were up 9% from Q4. Yahoo blames this on higher rev share fees and pruning out its lousy affiliates.

- Fees revenues were up a whopping 21% to $245M. (down 1% from Q4) No color. This includes portal fees from broadband ISPs from deals that are currently being re-negotiated away from fees toward ad rev-share agreements. For instance, AT&T paid $350M to unwind its contract, but that will be recognized over the 4 year term of the deal.

Total US revenue ex-TAC (minus revenue sharing) was up 17%, but that's probably buoyed by that fee growth. Int'l was up 7%. Owned & Operated ex-TAC growth was 15%; search O&O was 16% and display O&O was 15%. It feels like Yahoo's US display ad growth was about 15%. That means that, so far, we're not seeing the US economy pummel online display advertising revenue. Jupiter projects US display ad growth for 08 to hit 15%.

Ad categories Auto, Pharma, Telco, and CPG remain strong, with double-digit growth. Financial, Travel, Retail remain sluggish. Some of those sectors even showed decline. Of the strong categories, Telco & Tech were strong in display only; Pharma & Auto were strong in both display and search.

Remnant inventory CPMs nearly doubled. Yahoo is running its "non-guaranteed" ad inventory through Right Media's exchange, and it's working. Premium inventory prices were up modestly.

Average TAC rates globally remain 78%, and are seeing continued upward pressure from a very competitive environment.

Yahoo removed the 10-cent minimum required bids on select US keywords during the quarter (an auction approach should raise prices overall), but that had no impact on search yield yet. O&O search yield was up 10%, which is down from the 20% rate of the prior quarters, but that's because of tough comparisons as Panama first rolled out. Not much on the Google test, other than it leaves options open.

Search volume growth was over 10% in the US but less -- and under its goal -- internationally. Yahoo claimed it saw the most improvements in relevancy in five years.

Yahoo's revenue per search was up 15% globally. Yahoo figures that, when it started Panama, it had a 90% RPS gap compared with Google. It estimates it has closed that gap by 30 points, but there's still a 60 to 70% gap to close.

Everybody reiterated the core strategies. They're all on the same page at least. The objective is to be:

- Web "starting point" for the most users (starting points mean doubling down on home page, search, mail and a few key verticals like Finance, Sports, News; opening them up to third parties; and adding social connections to content but not becoming a social network)
- the must-buy ad inventory for the most advertisers
- a platform for the most developers

Yahoo's strategy for revenue growth depends on increasing:
- Search volume & yield
- Display volume & yield

Of these, the two yields offer the most promise, says Yahoo, with display volume growth the second most. Yahoo intends to grow display revenues 25% in both 2009 and 2010. That's way higher than Jupiter's US growth forecasts of 12% and 11%. Yahoo says it does indeed intend to gain share, but probably thinks our forecast is a shade conservative.

David Card | April 22, 2008, 10:50 AM
Some Un-Cruddy Digital Stuff

Of course digital is more than just free stuff. Amazon is the best media store ever. The Internet is the best library ever, and Google is the best index of same. On-demand music services are the best radio ever, and the iPod is the best portable media device ever. Mobile telephony is better than land-locked telephony. Tivo is better than VCRs. YouTube is lots more fun than America's Funniest Home Videos. Expedia is far superior to your local travel agent. Etc. etc. etc.

More importantly, eBay is the best person-to-person auction and selling machine ever. And it couldn't be done off-line. It's not replacing anything, it's inventing something new.

First AOL, and now Facebook or MySpace, depending on your tastes, are the best community communications platforms ever. And they're removed from geographic and time constraints, and more or less free of Big Media Control (debatable). And they enable multiple personae, if you should so choose. On the internet, no one knows you're a dog...

IM is the first real-time text communication vehicle. But even better, it offers presence management and sophisticated contact management, not thay anybody's done anything interesting with that yet.

The point is, digital works best when it doesn't merely replace an existing consumer or business service on the cheap, but rather when it creates something new. All I saw in the "cruddy" post were examples of cheap replacements.

Whaddaya, trying to kiss up to the boss?

David Card | April 21, 2008, 10:50 PM
The Real Reason Everything Is Getting So Cruddy

I don't really think it's about a "rebalancing of tradeoffs" or "ubiquity, scalability, extreme convenience, democratization, openness and personalization." Or especially that "the very definitions of “useful” and “needs” are up for grabs in ways that the creators of the earlier generations of consumer services and technologies could not have anticipated."

It's much simpler. Every example fellow Jup David Schatsky cites as a cruddier digital offering is either dramatically cheaper than what it replaced, or absolutely free.

David Card | April 21, 2008, 10:27 AM
Do We Really Need Another Movie Network on Cable?

While I chuckled at PaidContent's headline (Movielink Redux), my initial reaction to the Paramount-MGM-Lion's Gate JV was that it felt old-fashioned. From the announcement and coverage, it sounds like they're planning to do a Pay-TV movie network, and throwing in on-demand and Internet distribution (supposedly not ad-supported) almost as an afterthought. Variety's coverage tells Showtime's story best (they wouldn't pony up for high renewal fees, and so are going to get jilted.)

Viacom chief Philippe Dauman tells the Journal "We have a once-in a lifetime opportunity to think about reinventing the pay window for theatrical movies," but the only window the startup will break is Pay-TV (Internet availability will be simultaneous with Pay TV, apparently). No talk of DVDs or theatrical.

In the press, there's lots of talk of former Viacom properties (Viacom owns Paramount, CBS owns Showtime) sniping at one another. There's not so much on how the venture will crack an already crowded cable market or whether it will share revenues aggressively with carriers. Just that MTV Networks may do some marketing. Or is that negotiating?

Jupiter likes ad-supported Internet video a lot better than fee-based services. We're projecting $2.3B in 2012 online video ad revenues, and $600M in 2012 online video consumer fees.

David Card | April 20, 2008, 05:02 PM
Give Me Back My (Broadcast) Media!

In the civilized world, on a Sunday afternoon, on TV a guy can watch sports. Or even golf. But here, in the media capital of the universe, we get to watch the Pope at Yankee Stadium. Long live PBS!

David Card | April 19, 2008, 10:58 AM
Record Store Day

Do the industry a favor. Buy a CD. I'm pretty excited to listen to new releases from three of my faves: Nick Cave, Murder by Death, and Black Francis (Frank Black). Heck, I even paid sales tax...

David Card | April 17, 2008, 06:00 PM
Okay, Google Did Great. Next Comes Yahoo...

Lessons from Google pre earnings call hype:

- It's very difficult to use comScore data to build financial models. Wotta surprise; that's not what they're built for. But you'd think comScore would realize that there is such thing as bad PR.

- At the risk of sounding like a suckup sycophant, you modelers out there might want to pay attention when management tells you they're reducing bad clicks to make the good ones more effective. And expensive.

- Google says it doesn't feel any looming recession pain. Okay, but Int'l grew way faster than the US. I remain unconvinced that Internet advertising is recession-proof.

- Google babbled something about having display ad capability on 90% of its pages, and becoming the biggest display platform in the world. But then it quickly backed down and said it had no real plans for anything other than YouTube and Orkut.

- Bloggers have no shame. You didn't know that? Quoting Blodget at Silicon Alley Insider: "Google met revenue estimates and blew away EPS. Some hair on the quarter, but obviously miles from the disaster some had feared." "Some," Henry? Some??

Okay, I'm being a little unfair -- earlier today SAI predicted GOOG would beat consensus estimates. But, still, SAI's been one of the bigger fear-mongers that I read anyway...

- From the Journal: "Like other technology giants Intel Corp. and International Business Machines Corp., Google also reported strong growth in revenues abroad, potentially easing concerns that the slowdown in the U.S. is spreading world-wide and helping make the case that big tech companies may be well positioned to weather a domestic recession."

IBM is a services company and sells what is essentially capital equipment (computers used to be counter-cyclical -- 15 years ago -- but no more), Intel is a near-monopoly that sells components, mostly to PC companies, and Google makes its money off of advertising. Why does the performance of these three companies indicate anything whatsoever for a mythical "tech sector?"

David Card | April 15, 2008, 01:21 PM
Dubious Data, Part XLIV

If this stat meant anything, Yahoo's ad network would be worth 93% as much as AOL's, Google's 89% of AOL's, and ValueClick's 82%. But of course, that's not the case.

In Q4 of 2007, Google paid out $1.3 billion to its AdSense partners, Yahoo paid out about $430 million, and AOL paid out about $250 million. I'm basing this on company-reported TAC, or traffic acquisition costs, which is what they call revenues shared with network partners.

Of course, the companies all use their own networks, too, and take varying fees. But for an apples-to-apples comparison of market force or industry power -- if not value -- TAC comparisons are useful. (ValueClick's total revenues were $183 million in Q4.)

Fellow members of the digerati and commentariat, please stop obsessing about absolute reach. Without more context, it's a worthless metric.