Month: October 2007

Ad networks vs ad exchanges

I spent yesterday at the Right Media Open event in Half Moon Bay at the Ritz Carlton Hotel.


Right Media assembled an impressive list of executives and innovators including John Battelle of Federated Media, David Rosenblatt of DoubleClick, Scott Howe of Microsoft, entrepreneur Steve Jenkins, Jonathan Shapiro of MediaWhiz, Ellen Siminoff of Efficient Frontiers, and Yahoo!’s own Bill Wise and the Right Media team including Pat McCarthy to name a few.

It was an intimate gathering of maybe 120 people.

Much of the dialog at the event revolved around ad exchange market dynamics and how ad networks differ from exchanges. DoubleClick’s Roseblatt described the 2 as analagous to stock exchanges and hedge funds…there are a few large exchanges where everyone can participate and then there are many specialized networks that serve a particular market or customer segment. That seemed to resonate with people.

The day opened with a very candid dialog between Jerry Yang and IAB President Randall Rothenberg where Jerry talked about his approach to refocusing the company and his experiences at Yahoo! to date.

Battelle’s panel later in the afternoon was very engaging, as well. The respective leaders of the ad technology divisions at Yahoo! (Mike Walrath of Right Media), Miscrosoft (Scott Howe of Drivepm and Atlas) and Google (David Rosenblatt of DoubleClick) shared the stage and took questions from John who, as usual, didn’t hold back.

The panelists seemed to have similar approaches to the exchange market, though it seems clear that Right Media has a more mature approach, ironically due in large part to the company’s youth. Microsoft was touting its technology “arsenal”. And DoubleClick wasn’t afraid to admit that they were still testing the waters.

I also learned about an interesting market of middlemen that I didn’t know existed. For example, I spoke with a guy from a company called exeLate that serves as a user behavior data provider between a publisher and an exchange.

There were also ad services providers like Text Link Ads and publishers like Jim Mansfield’s PhoneZoo all discussing the tricky aspects of managing the mixture of inventory, rates and yield, relationships with ad networks, and the advantages of using exchanges.

I’ve been mostly out of touch with the ad technology world for too long.

Our advanced advertising technology experiments at InfoWorld such as behavioral targeting with Tacoda, O & O contextual targeting services like CheckM8, our own RSS advertising, lead generation and rich media experiences were under development about 3 years ago now.

This event was a great way to reacquaint myself with what’s going on out in the market starting at the top from the strategic business perspective. I knew ad exchanges were going to be hot when I learned about Right Media a year ago, but I’m even more bullish on the concept now.

The positive outlook for Yahoo!

I was able to contribute a quote to a BusinessWeek.com story by Catherine Holahan on changes happening at Yahoo!. Unfortunately, she also quotes from a really old blog post of mine (July 2006) which feels like a lifetime ago, but she gets the point right that things have improved here:

“Yahoo: Bringing Geeky Back“:

“Business is anything but usual under cofounder Yang, who’s trying to return Yahoo to its roots as a technology company … Matt McAlister, director of Yahoo’s Developer Network, said in an e-mail that he’s “never been more optimistic about the future of the company,” thanks in large part to these developer initiatives. “I think Yahoo is focusing on the right things and moving in a very positive direction,” he added. “

She talks a little about the ways the company is opening up, and she’s right that the developer initiatives are really coming along at Yahoo! (despite kind of getting open API thing wrong…API’s != “source codes“).

It feels like the beginning of something good here at Yahoo!.

Building community is hard

Jay Rosen has an interesting post on the failure of AssignmentZero, an effort to build a publicly funded crowdsourced news organization.

Among the many lessons, he keeps coming back to motivation and incentive.

“A well managed project correctly estimates what motivates people to join in, what the various rewards are for participants, and where the practical limits of their involvement lie.

…amateur production will never replace the system of paid correspondents. It only springs to life when people are motivated enough to self-assign and follow through.”

The idea wasn’t fundamentally broken, in my mind. Crowdsourced news is very powerful. As Derek Powazek said,

“At its best, crowdsourcing is about expanding the walls of the newsroom to the internet, giving an opportunity to people with real experience to share their expertise. This is a point that’s often lost on people who are just looking to make a quick buck on Web 2.0.”

More than anything else, I suspect that AssignmentZero failed because there weren’t any readers. Motivation wouldn’t have been a problem with a NYTimes-sized audience.

To date, I’ve never seen a better explanation of the motivations in collaborative online experiences than Yochai Benkler’s paper called Coase’s Penguin. One of my favorite excerpts from that is where he warns against paying for contributions from the community:

“An act of love drastically changes meaning when one person offers the other money at its end, and a dinner party guest who will take out a checkbook at the end of dinner instead of bringing flowers or a bottle of wine at the beginning will likely never be invited again.”

There are as many motivations as there are contributors in a shared media project. What holds them together is more art than science. Some of that art includes good timing and luck. But it also requires a unique kind of commitment and salesmanship from the leaders of the project.

I’ve begun to wonder if the tipping point happens when the confluence of the community size, the ROI to the contributors and the depth of the trust relationship with the company or the brand creates more value than the sum of the parts. Maybe the science of collaboration services can be found by quantifying the meaning of the relationships between those elements: size, cost, benefit and trust.

Or it could also be that the secret sauce inside the Craig Newmarks, Stewart Butterfields and Jimmy Waleses of the world is much more complicated and nuanced than anyone realizes.

Announcing baby with Twitter

I get Twitter now.

Announcing baby with TwitterUntil last week it seemed a bit silly to me, perhaps overhyped. But after using it to share updates of my son’s birth with friends and family members distributed across several time zones in near real-time, I’ve become a new fan of this fantastic tool.

Whereas I may have used email to announce his arrival before Twitter (something I also did after the fact), I was able to Twitter the experience of my son’s arrival throughout the day using my phone to simply send a little bit of info at a time via SMS.

Email would have been way too cumbersome for nearly live storytelling like this. Plus, the self-selective nature of it allowed some people to follow my posts who I probably wouldn’t have thought to email.

Flickr served a similar role for my daughter’s birth nearly 3 years ago, and it was invaluable to me again this time now that my mother and mother-in-law are both Flickr users finally. The photo-hungry grandparent is insatiable when it comes to newborns.

But Twitter adds a really nice new dimension to the way we share bits of our daily experience.

It was great knowing that my little brother in London and my older brother in Los Angeles were getting text messages on their phones as this major life event unfolded for me. Twitter made it feel like they were part of the experience, like bystanders, even if the details were as boring as where we ate dinner or what was on the TV in the hospital waiting room (Fresh Choice and Maury Povich, in case you’re interested).

Big sis checks out her new baby brotherSomehow I think the inability to share those inane details with the people we care about is exactly what makes people feel isolated in this modern distributed world. Well, maybe the world doesn’t need more meaningless data out there, but it certainly needs better ways to get the right data to the right people at the right time.

Twitter does just that.