NEW YORK: Yahoo! has rushed to counter the growing threat from Google in the market for online advertising, agreeing to pay $680 million to take control of Real Media, a company that runs an “exchange” where advertisers can buy space on thousands of niche websites.
The deal comes less than a month after Google paid $3.1 billion to buy DoubleClick, the web’s largest advertising network, whose technology is used to place display ads – banners, pop-ups and video ads – on to websites.
Yahoo! has fallen behind Google in the market for text adverts that are generated when an Internet user types a search query, and it is determined not to risk becoming an also-ran in display advertising.
Real Media uses an open auction system rather than a closed network for bringing together buyers and sellers of advertising space, and Yahoo! hopes that putting its muscle behind the auction will give it the edge over Google’s DoubleClick.
By making its own network of web pages available through the auction, Yahoo! also hopes to solve one of advertisers’ biggest Internet headaches.
“The blight of online advertising is the fragmentation problem,” says Andrew Frank of the market research group Gartner. “It is very hard for a large advertiser to amass a large quantity of premium advertising space because the audience is spread out across a vast array of niche sites.
“Advertisers are not spending as much more money online as people are spending more time online, and there is a value gap between what advertisers are willing to spend and what they are able to buy.”
Yahoo!’s chief executive Terry Semel said Right Media gave the company a big advantage as advertisers look to switch resources to the web.
“There is an enormous opportunity coming in the near-term future,” he said.
New York-based Right Media was founded just four years ago, and has grown rapidly so that more than 20,000 buyers and sellers every day trade ads that appear on an average 4bn page impressions. It takes a commission of eight per cent on each deal, and is expected to reach break-even at the end of this year.
Yahoo! bought a 20pc stake in the Right Media last October, but the full takeover announced yesterday gives the company a valuation more than four times that which it had just six months ago. Partly that reflects the speed with which online advertising is growing and the benefits of combining Real Media with Yahoo!. But it also underscores Yahoo!’s increasing desperation to shore up its defences against Google, under chief executive Eric Schmidt, which, since the DoubleClick deal, threatens to dominate both search-based and display advertising on the internet.
Youssef Squali, analyst at Jefferies & Co, highlighted two reasons why Yahoo! had to get its chequebook out quickly. The DoubleClick deal was likely to spark further consolidation among Internet advertising specialists, and DoubleClick itself is poised to become a much more serious threat to Right Media.
“DoubleClick launched an ad exchange a few days before it was acquired by Google,” Mr Squali said. “Versus Right Media, we believe that DoubleClick will compete effectively due to its large installed base of publishers.”
The acquisitions of DoubleClick by Google and now Right Media by Yahoo! throw the spotlight now on Microsoft, the next largest seller of search-based advertising on the Internet and a company keen to expand in display advertising. Online advertising specialists, though, are becoming more pricey. Mr Youssef said: “We believe consolidation is spurring large players into action and driving up valuations for the group as a whole.”
Andrew Goodman was recently interviewed by Pandia Search Engine News. One of the things I like about the interview is his discussion about a way that Google could lost it’s stranglehold on the search market. It occurs during his discussion of the increasing focus on personalization by Google.
As Andrew notes “Done right, it’s a natural extension of what search ought to be”. But, there are real potential issues with privacy concerns as well. If it’s not done right, it could create a groundswell of concern that could be really damaging. People may become afraid to search, because their search history will be stored.
And this certainly could be a scenario that could hurt Google with this new initiative. However, I think the likelihood is pretty low – it’s just not a mistake that I think Google will make.
One way to look at a potential Google downfall is to look at recent past history. How did Microsoft lost it’s clear leadership of the technology market? By making their existing products, which are still incredibly important, less relevant. The focus shifted to search, and Microsoft did not get out there with it’s offerings quickly enough.
This is exactly what happened to the railroad companies in the US about a century ago. There is an old business school lesson about this – the railroad companies should have thought of themselves as “transportation companies”. If the railroad companies had thought of themselves in that light, they would have taken an active hand in the automobile revolution that did them in.
It repeated itself in a different way a couple of decades ago when the Japanese car manufacturers were stealing huge amounts of market share in the US auto market because every one was so concerned about gas mileage. While they remain a strong factor in the market, they lost all of their forward momentum, and the US auto manufacturers revived and became strong again.
What happened there? There is another business school lesson that covers this one – if the competitive playing field is stacked against you, change the playing field (or the rules of the game).
With companies as dominant as Microsoft was, and Google now is, changing the landscape is not something you can do by yourself. You need to wait for shifts in technology to happen, and this is something that could really take quite some time to happen. In other words, don’t hold your breath. The challenge for Google will be to remain very nimble, see the broader landscape at all times, and keep the natural arrogance of a market leader in check.
I think that was answered earlier today when the Google employee Matt Cutts SEO blog was hacked by the owner of a blackhat SEO blog.
Whitehat SEO Turns to the Dark side!
In a moment of madness the whitehat of Matt Cutts was temporarily tossed aside as he recipricated in kind and hacked the blackhat’s SEO blog
Obviously that’s not what really happened. A hackers had some fun with two site owners.
I’m sure Matt and Dark SEO Team will fix their sites quite quickly, so I took screenshots for prosperity
Text on the page:
This site have been hacked by
Dark SEO Team.
nous sommes le proprietaire de toi
Shoutz to Dan “the man”, the 302 hijack t33m, NYC SEO gang, Linusx, pentazilla, daxster, boogybonmot, Earl+Duke, davenator, cRWc, monkeyboy, the canadian crew::J&T,
spamhuntress, LB, jb, NW, -eng, U(r|d)(s|i), L/S, Z-man, scbl, RandomFish, huZZah, chivesmack, Shchoeoe+npMMo, lejackalgris, theGUY to GoTo, phenssen, Romanian Brothers and all the FORUMS!!
In BLACK SEO’in We TrUsT!!!
.:: Dark SEO Team ::. (link back Dark SEO Team blog)
Despite the illegal nature of hacking it is very funny. Matts SEO blog now link to the home page of Dark SEO Team which has also being hacked!
The text is quite funny-
Defaced by Matt ! I ownz you, Dark seo team
Of course I’m lying when I make everyone believe that content is King.
Of course black hat SEO and spamdexing are the only Kings.
Google is just a stupid algorithm relying on spammy backlinks.
But you guys had no right to let everyone know. That’s why I defaced your bloody DST site. To show the entire world how evil a white hat can be.
In fact, I’m as evil as my employer
All your backlinks are belong to us !
**Head of the Google’s Webspam team** (link back to Matt’s SEO Blog)
If the hackers read this I think you rule, so don’t hack my sites
Ever since Google introduced their page ranks(PR), web site traffic rankings, took on a whole new dimension. Today, page ranks is a much talked about subject and a very important factor in your web site traffic ranking. Although your traffic ranking is only relevant with the Google search engine, it is important to realize that many of the smaller search engines draw their ‘relevance’ from Google – meaning that a high web site traffic ranking with Google will most certainly benefit you on the other search engines. Search engine traffic is still the best source of traffic on the internet and the more of it you can get the better. By improving your web site traffic ranking even on just one search engine, you can become more important with all the search engines.
So what is a web site’ page rank anyway? The ranking system is nothing but a way for Google to assign a level of importance to your website. When someone searches for something the ranking determines what’s most relevant and what’s the most important information on that specific search term. Think of the entire internet as one big library of information. The search engines act as indexing systems that helps you to find information in this big library. Just like in a ‘normal’ library, certain books are more important and more relevant than others. Instead of you having to go to every website to find the most important and most relevant information, Google assigns a page rank that predetermines the importance and relevance of your website. When someone searches for something specific online, the page rank of a website will largely determine which site is most important and what the specific web site traffic ranking is for that search.
If two websites contain exactly the same information, the one with the highest page rank will be the one that gets shown in the search results. One of the easiest ways for Google to determine whether your website is important is to see whether other websites value your website. In other words if other websites link to your site it means that your site has something that other sites think is important. Google likes this, and if other sites like you then it is very likely that Google will also like you.
Getting links to your website is one of the best strategies for improving your web site traffic ranking. But it’s not as simple as that. To make some more refined distinctions between important and unimportant websites, Google will also check the traffic ranking of the site linking to yours. Getting one link from a website with a page rank of 6 will mean more than ten links from websites with a page rank of 2. So, it’s not just about getting links, but it’s about getting quality links from high PR websites in the same niche as yours (must be relevant information). Always try and keep the ‘human factor’ in mind – search engines provide a service and that service is to serve people with the best information for their needs.
With web site traffic rankings it is important to distinguish between importance and relevance. Relevance is determined by standard SEO practices of your content, your keywords and the actual information on your website. Importance is determined by your page rank. Doing the one without the other won’t be of any use if you want a high web site traffic ranking with the search engines.
When the whole ranking system became important, several marketers got smart started building what is known as ‘link farms’ or ‘link exchanges’ where different web masters exchange links and by the sheer amount of links they were able to boost their web site traffic rankings significantly. Google quickly caught on to this and now distinguishes between one-way and reciprocal links. A one way link is worth much more than a reciprocal link. These types of link exchanges are becoming less effective and you will be much better off spending your time and effort building quality links from high PR and authority sites in your niche – preferably one way links.
One of the best strategies for building one way links from high PR websites is to write articles and submit them to article directories. Your links within the article is a one way back link and many of the article directories have very high web site traffic rankings. This can be very time consuming but well worth the effort. Many authority sites with very high PR’s offer the opportunity for you to exchange links with them or to post comments or list your website in their directory. These are worth gold and getting one way back links from these sites will help you greatly in working your way to the top of Google’s ranking.