Online Ad Market Expected To Beat TV By 2012

By Antone GonsalvesInformationWeek

cable TV

In four years, online advertising will rise from the fifth-largest medium to the second behind direct marketing, IDC said. Overall revenue from Internet ads will double to $51.1 billion in 2012 from $25.5 billion last year, the beginning of IDC's forecast period.

Video advertising will lead the shift, attracting the most new marketing dollars, the research firm said. Revenue from video will grow sevenfold to $3.8 billion from $500 million. Brand advertisers are expected to shift significant amounts of money into online video commercials from broadcast television and to a lesser extent from cable TV.

People are expected to spend more time watching online video as broadband access penetration increases, connections become faster, and more premium content becomes available.

"What will also drive this trend is that consumers are starting to realize that, as opposed to TV, Internet video lets them watch what they want, when they want, and increasingly also where they want," Karsten Weide, program director for IDC's digital media and entertainment unit, said in a statement.

Search advertising will continue to garner the most revenue over the forecast period in the United States, IDC said. This means that for any media company, search must remain a key part of its strategy for attracting ad dollars, despite Google's current dominance of the market, the analyst firm said. Google has about a 70% share of the search advertising market.

IDC is not the only analyst firm predicting significant growth in online advertising revenue. The Yankee Group expects the market to reach $50.3 billion by 2011, double the amount of 2007. The firm pegged the expected growth to the increasing size of the audience, the development of new types of advertising, and the creation of new publisher business models that will help sell interactive ads.

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IDC: US Internet Ad Spending to Boom

Juan Carlos Perez, IDG News Service

Online advertising will balloon in the coming years, becoming bigger than all advertising media except direct marketing by 2012, according to IDC.

Spending in U.S. online advertising will double from US$25.5 billion in 2007 to $51.1 billion in 2012, along the way climbing up from the fifth-largest to the second-largest ad medium and dwarfing newspapers, cable and broadcast TV, IDC said Friday.

The growth will come despite the economic turmoil roiling the U.S., as marketers shift advertising dollars to the Internet to take advantage of emerging formats like online video, which will see its ad spending shoot up sevenfold from $500 million in 2007 to $3.8 billion in 2012, a compound annual growth rate of almost 50 percent for that time period.

Factors that will boost online video advertising include an increase in broadband access, faster connections, the availability of more "premium" content and viewers' embrace of the medium's flexibility to pick what they watch and when, according to IDC.

Meanwhile, search advertising will continue as the single largest format for online advertising. Search advertising is currently dominated by Google with about 70 percent of the U.S. spending, IDC said.

Earlier this month, the Interactive Advertising Bureau (IAB) reported that U.S. online ad spending increased 26 percent in 2007 over 2006, and that the Google-dominated search format not only remained the market's largest, but also increased its share of the overall pie.

Search advertising accounted for 41 percent of the $21.2 billion in U.S. online spending last year, up from 40 percent in 2006, the IAB said. In 2007, spending in search advertising grew 30 percent over 2006.

With highly optimistic reports like these about the expected continued growth in online ad spending, the sense of urgency likely grows among companies like Microsoft, AOL and Yahoo, all of which have so far failed to capitalize as much their investors and executives have expected on online advertising's growth in recent years.

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FCC Considers Free Internet, Revised D-Block Auction

Barry Levine, newsfactor

According to a story in Thursday's Wall Street Journal, one of those plans includes a free wireless Internet. The winner of the auction for those frequencies would make broadband wireless Internet available to most of the U.S. Although details of the plan have not been worked out, there are reports that the FCC plan would mandate that the frequencies could not transmit everything the wildly diverse Internet could offer, such as pornography.

The D Block

Another plan for a new auction would be directed at getting a winning bid for the D Block. That group of frequencies was not sold at the last auction, as the minimum bid of $1.3 billion was not reached. Under FCC rules, the buyer would need to allow part of the spectrum to be used by public-safety agencies.

As a run-up to the D-Block reauction, the FCC has been taking comments from industry, public safety, and academics on how the rules for the D Block might be revised to attract higher bids. According to news reports, many public-safety groups, such as the Association of Public-Safety Communications Officials-International and the National Emergency Number Association, as well as some members of Congress are suggesting that the FCC keep the same public-private partnership as previously required.

This requirement seeks to guarantee that broadband communications between government agencies have national coverage and interoperability by requiring the commercial operator to make the frequencies available in the event of emergencies.

'Doesn't Seem Realistic'

The proposition, he said, was that the winning bidder gets the spectrum, uses a great deal of money to build and support the network, and then has to give up its use at times to public agencies. This less-than-compelling business proposition, he noted, was the reason the D Block only attracted one bidder, Qualcomm.

To be attractive to commercial bidders, Ho said, the FCC has to figure out some better incentives in exchange for sharing with public agencies.

He also did not think the idea of auctioning off frequencies that offer free Internet is a very compelling business opportunity. He said it was "interesting, but it doesn't seem realistic," similar to municipality-owned Wi-Fi.

"You get the frequencies, build it out, and then give it away for free," he said, adding that a comparison to television, which does the same thing, is not equivalent. Running an Internet network, he pointed out, involves a greater level of expense and a greater challenge for advertisers than sending TV shows over the air.

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Qualcomm's Plaza To Enable Easier Mobile Widgets

By Marin PerezInformationWeek

growing personalization demandQualcommwidget

The end-to-end framework, dubbed Plaza, will use basic Web standards for development. This will allow the existing Web development community to create widgets for the mobile Internet, while not excluding traditional mobile application developers, and even allow user-generated widgets.

"Plaza is designed such that mobile widgets can come from a number of sources, including operators, Web companies, and leading brands, who all share the ultimate goal of driving subscriber adoption of the mobile Internet. We believe that providing end users with an easy way to extend their online lives to their mobile devices will help drive the uptake of data services," Andrew Gilbert, executive VP and president of Qualcomm Internet Services, MediaFLO Technologies, and Qualcomm Europe, said in a written announcement.

As smartphones increasingly become consumers' choice for accessing the mobile Web, the popularity of mobile widgets is expected to grow. With a plethora of widgets on the iPhone, multiple offerings from Yahoo, and Nokia's widgets, Plaza is wading into increasingly crowded waters.

Qualcomm said Plaza's ease of implementation will give it an advantage over competitors. While Plaza is not device-dependent, operators can integrate it into their hardware and opt to give these widgets prominent placement on the device.

The company did not give a specific date for commercialization, but it's targeting the first quarter of 2009.

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Microsoft linking Silverlight, Ruby on Rails

Paul Krill

MicrosoftRuby on Rails Web

The integration will be done via a plug-in, according to a Microsoft representative. Microsoft officials will detail Ruby on Rails efforts at the RailsConf 2008 conference in Portland, Ore., which is happening now through the weekend. The plug-in will be free to conference attendees.

Silverlight is Microsoft's entry into the rich Internet application space, where the company will battle Adobe's Flash technology.

Also at the event, Microsoft officials will demonstrate IronRuby, a version of the Ruby programming language for Microsoft's .Net platform, running a Ruby on Rails application.

"Running Rails shows that we are serious when we say that we are going to create a Ruby that runs real Ruby programs. And there isn???t a more real Ruby program than Rails," said a blog entry on Friday from Microsoft's John Lam, a program manager in the Dynamic Language Runtime team, who will present at the conference.

The company, though, still needs to improve performance on Rails, he said. Currently, too much memory is being consumed.

"IronRuby doesn???t just let you run Rails; it lets you interact with the rich set of libraries provided by .Net," Lam said. "You???ll be able to use IronRuby to build server-based applications that run on top of ASP.Net or ASP.Net MVC. You???ll be able to use IronRuby to build client applications that run on top of WPF (Windows Presentation Foundation) or Silverlight."

The IronRuby project in general has featured processes that make it easier for Microsoft to develop open source projects, said Lam.

"What we learn from building IronRuby will be applied in other product groups to help us become more open and transparent than we have been in the past," Lam said.

Meanwhile, FiveRuns is unveiling Friday tools to profile and monitor Ruby on Rails application performance.

The public beta of the company's TuneUp product is being released. TuneUp is a free application profiling tool profiling performance analysis. Also offered, in its general release form, is Manage 2.0, a subscription-based application performance management product for applications in production.

The company also plans to contribute open source components to the Rails community, beginning with an instrumentation library, called FiveRuns Instrument, offered at FiveRuns.org, RubyForge, and Github. The software provides an API for instrumenting Ruby method invocations.

TuneUp was described by the company as a tool that provides visibility into application performance during the development phase. Developers learn of performance trouble spots and bottlenecks prior to production, FiveRuns said. A TuneUp plugin can be installed for access to performance metrics.

Developers can collaborate with others, browse application profiles, and look for similar configuration and performance problems.

"FiveRuns TuneUp gives developers deep visibility and relevant information to debug and improve the performance of their application and a community setting to collaborate with others to solve tough performance problems," said Steve Sanderson, FiveRuns vice president of development and technology, in a statement released by the company.

Manage 2.0 is a lighter upgrade to the initial product, adding monitoring support for more subsystems and other new features. Featured are enhanced rails metrics, monitoring for the entire Rails stack, and customizable contextual Triggers and Notification Chains that alert users to problems.

??A light Ruby client for Manage 2.0 consumes minimal resources and is optimized for virtual environments, the Amazon Elastic Compute Cloud service, and other server environments.

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Publishers expect book sales to stay flat

By HILLEL ITALIE, AP National Writer
2 hours, 36 minutes ago

The Book Industry Study Group, a nonprofit organization supported by the publishing industry, projects a 3 percent to 4 percent growth through 2011, when revenues should top $43 billion. The BISG expects little change in the actual number of books sold and sees a drop in the general trade market by more than 60 million, from 2.282 billion copies in 2007 to 2.220 billion in 2011.

"The hits will keep doing well, but other books will have troubles," says BISG senior researcher Albert N. Greco, a professor of marketing at the Fordham University Graduate School of Business.

The findings were announced at BookExpo America, being held this weekend at the Los Angeles Convention Center.

Barring another Potter-like phenomenon, Greco believes the children's market will barely break even. Modest gains are projected in most adult categories, although that could change once Brown comes out with his long-awaited follow-up to "The Da Vinci Code." No release date has been set for the novel, which also features protagonist Robert Langdon, a Harvard University professor who interprets symbols.

The biggest losers likely will be mass market paperbacks, which continue to plunge as baby boomers seek formats with larger print, while religious books should keep growing, by more than 5 percent annually.

The hottest market, according to the industry study group, isn't books, but standardized tests, boosted by the requirements of the No Child Left Behind legislation. Growth of 8 percent or better is expected through at least 2009.

"It's the one sector, without a doubt, that's really going to expand," Greco said.

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McClellan's book on Bush a surprise hit for many

By HILLEL ITALIE, AP National Writer
2 hours, 24 minutes ago

Scott McClellan's bookWhite House spokesman

"Books by spokespeople rarely contain anything newsworthy and have generally not proven particularly compelling to consumers," said Steve Ross, publisher of the Collins division of HarperCollins and head of the Crown Publishing Group at Random House Inc. at the time McClellan was offering his manuscript. "It was shopped around but, like others who publish in the category, we didn't even take a meeting based upon past history."

McClellan, a press secretary known for loyally defending President Bush on Iraq, Katrina and other issues, has written that his ex-boss misled the country about Iraq and calls the White House atmosphere "insular, secretive and combative."

"What Happened: Inside the Bush White House and Washington's Culture of Deception" was No. 1 on Amazon and the publisher, Public Affairs, said that the printing has been doubled from 65,000 to 130,000.

McClellan's accusations have been met by counteraccusations that he is cashing in on his White House access. Bush supporters have criticized him, but so have liberals such as commentator Arianna Huffington.

"It's George Tenet deja vu all over again," Huffington wrote in a posting on her blog, http://www.huffingtonpost, referring to the former CIA director who received seven figures for his memoir. "How many times are we going to have a key Bush administration official try to wash the blood off his hands — and add a chunk of change to his bank account — by writing a come-clean book years after the fact ..."

But McClellan's book does not fit the pattern of Washington megadeals. He was not represented by Washington, D.C., attorney Bob Barnett, whose clients include Tenet and countless political leaders, but by the much less known Craig Wiley, whose most famous client is actor Ron Silver.

McClellan's advance did not approach the level of Barnett's writers. According to an official with knowledge of McClellan's contract — who spoke on condition of anonymity citing the confidentiality of the pact — McClellan received only $75,000 from PublicAffairs, which specializes in policy books by billionaire George Soros, Nobel Prize-winning economist Muhammad Yunus and others.

Rival publishers say they had no sense that McClellan would make such explosive observations, a belief scorned by PublicAffairs founder Peter Osnos.

"Of course they didn't know what would be in it, because they didn't acquire the book," said Osnos, currently in Los Angeles for BookExpo America, publishing's annual national gathering. "Very rarely does a book turn out the way it's expected."

Osnos said he didn't even read the proposal, but instead sought out people who knew McClellan and said they regarded him as an honest man unhappy in his job. According to Osnos, and the book's editor, Lisa Kaufman, "What Happened" evolved as McClellan wrote it.

"The original proposal was somewhat general, so before making an offer on the book we talked to Scott at some length," Kaufman said.

"As Scott says in the preface, writing the book was a process for him. ... The tone was always thoughtful, straightforward, and candid. It's just that as he thought about his experience over many months, that tone began to be directed toward issues and events that some people would rather he not be straightforward and candid about."

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