Zynga And The Ad Business; History Sniffing And Data Firms Settle; Ad Networks Ponder ATDs And FTC

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Zynga And The Ad Business

Mediaweek’s Mike Shields eyes the growing social gaming phenomenon led by Zynga. Shields wonders if ignoring the ad market will bite Zynga in the posterior down the road:Some say that Zynga’s engineer-heavy culture just isn’t that interested in advertising. Others argue that the company, which should earn $500 million in revenue this year from the sale of virtual goods alone, simply doesn’t need the money.” Still, a challenge remains around ad standards in social gaming says Shields. Read more.

History Sniffing, Flash Cookies

The Wall Street Journal reports that online porn site, YouPorn, has become the subject of a lawsuit filed by two people in California who claim the company used a technique called “history sniffing” where a site owner compiles – without consent – an online behavioral targeting profile on users according to sites and and pages they have visited. Read more. Also, the WSJ reported that Quantcast and Clearspring are settling a lawsuit and agreeing not to use Flash Cookies for anything other than “instances related to Adobe System Inc.’s Flash program, which is commonly used to show video online.” The two companies also agreed to pay $2.4 million to online privacy nonprofits.

Google’s Wojcicki On Bridging To Offline

Emma Barnett of the UK’s The Telegraph profiles Susan Wojcicki, Google’s svp of product management, who states her credentials simply, “I am (…) the only person who has worked on AdSense for the last eight years continually and I am responsible for Google’s advertising system – which accounts for approximately 97% of the company’s revenues.” Regarding Google’s new, enhanced product search, “[Wojcicki] says that the product is just ‘the beginning’ of what Google plans to do to make offline and online come together in a more seamless and useful fashion, for both consumer and advertiser alike.” Read more.

FTC Is Bad, ATD Is Worse For Ad Networks

David Kaplan provides an overview on PaidContent of who would suffer if the U.S. Federal Trade Commission’s recommendation regarding creation of a Do-Not-Track list was implemented. Undertone’s CEO Mike Cassidy discusses the impact on ad networks with Kaplan, “If the FTC’s Do Not Track button does get implemented, it would devastate a lot of these companies. But they’re already being devastated by the ad agencies trading desks, which is diminishing their value faster than talk of new regulation.” Read more. For more on the debate around the implementation of a Do-Not-Track list, visit the New York Times’ “Room For Debate” section where a collection of 5 law professors and/or lawyers offer their views.

Bubble Makes The NYT

The investing bubble has made the mainstream media. Beginning of the end? The New York Times Deal Book takes note of the bubble forming in Silicon Valley – and Alley for that matter – and writes, “No one really knows if there is a bubble until after one pops. Nevertheless, there are many signs of froth. For example, enthusiasm for closely held Facebook shares has run so high that private investors are trading derivatives of it.” And now word comes that Group has rejected Google’s $6 billion offer. Read more. One difference for some of these new “bubble” companies compared to the bubble companies of years ago – profitability. And in GroupOn’s case, All Things D’s Kara Swisher says GroupOn’s revenues are already hitting $2 BILLION after just a couple years of existence.

Smoking The RTB Weed

From their twitter account, publisher analytics firm Metamarkets announced that its “Quant Lead” Joseph Reisinger will be presenting a paper co-written with Metamarkets co-founder Michael Driscoll at an upcoming Neural Information Processing Systems Workshop. (Wenda! Get the hammer away from the screen NOW!)  The reason for Riesinger’s participation is a dense paper on real-time bidding (RTB) which explores “the effects of informed bidders and information asymmetries between the supply- and demand-side in RTB markets and the resulting effects on empirical ad market microstructure. (…) The presence of differential pricing strategies, such as those employed by DSPs can be inferred directly from the bid price distribution.” Mmmm, that’s some good sh*t. Read about deciphering online ad pricing RTB-style and more (PDF).

CPCs Up In November

Metric machine Dr. Siddarth Shah cranks out the November 2010 CPC data from the Efficient Frontier search engine marketing, data, treasure trove.  He doesn’t offer too much analysis this time but perhaps that’s because EF clients are keeping him busy. He writes, “CPCs in all sectors remained at substantially higher levels than last year. The YoY increase in CPCs for November are 10% for Finance, 6% for Retail, 24% in the automotive sector and whopping 37% in the travel sector.” See the chart.

Google Juicing YouTube, Fighting Pirates

Google has made another of its monthly-or-better acquisitions as the Company announced on the Official Google blog that it has acquired anti-piracy software maker Widevine for an unspecified sum. Mario Queiroz, VP of Product Management, writes about the reasons behind the acquisition of the Seattle-based company: “The Widevine team has worked to provide a better video delivery experience for businesses of all kinds (…) By forging partnerships across the entire ecosystem, Widevine has made on demand services more efficient and secure for media companies, and ultimately more available and convenient for users.” And, that’s a good fit for the YouTube business unit. Read more. And, more from Reuters.

The Agency Fee Squeeze

On Advertising Age, Marc Brownstein pens a thought leadership piece whose them blames Walmart-like operations for the increasingly limited fees an agency can charge a marketer.  Low margins for the marketer means low margin for the agency. But, he offers a few tips on how agencies can beat the system: “Improve the product we offer by hiring even better talent; Measure what we do, and structure compensation so that we can be rewarded for great performance. Make clients a partner in the success and everyone wins…” And more -read about it.

Display Ad FAQ For SEMs

Fuor Digital’s Josh Dreller provides SEMs on Search Engine Land with a quick-and-dirty version of questions they may be asking and the answers they may need to start their own display ad campaign. One of the FAQs and an answer: “How is display bought and sold? Generally, it’s done similarly to offline advertising via a cost per thousand (CPM) model, but many different pricing models exist. Many times, advertisers and agencies will issue request for proposals (RAPs) from publishers who they think might be worth investigating for a particular campaign due to the sites’ content and audience.” Read them all.

Monetize This

Facebook Director of Monetization Tim Kendall has left the company as TechCrunch’s Mike Arrington publishes an internal FB memo congratulating Kendall on his service. No word on where he will go next as former Google-rs have been hired at his level and above in the recent past according to Arrington, who adds that the purchase of a small Latin American country may be in Kendall’s future considering the value of his Facebook stock.  Read more.

Wait A Second, Mary

On journalism site, Poynter.org, Rick Edmonds reviews Mary Meeker’s recent state of the internet report and thinks its too rosy: “Meeker’s big picture measure seems to me to suffer from one critical oversimplification: the notion that advertising is more or less equally effective by platform. Give digital its due with the obviously potent search ad format, but display advertising is a different story entirely. Newspaper, magazines and television each offer mature formats with particular strengths that advertising professionals know how to exploit. By contrast, way too big a share of digital display consists of banners easily ignored or various pop-up formats that annoy more than they sell.” Read more.

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