Articles of the Day


Newspapers Cope With Ad Slowdown: Hold Back On Inventory And Ad Nets — The NYT weighs in on newspapers’ struggles amid the online ad slowdown and surveys a number of different strategies being employed. McClatchy, for one, says they are decidedly reducing the number of online ad units in invetory. “It is a case where yeah, you could probably sell another advertiser by creating another ad space,” but that would tend to depress overall revenue, says Christian Hendricks, VP for interactive media at McClatchy. The publisher’s Q2 internet revs climbed 12.5 percent, which represents about 11.8 percent of its total ad revs from that period.

MySpace Expands Self-Serve MyAds Display Ad Service — MySpace’s hyping up its expanded self-serve ad service like the second coming of, well, Google AdWords. After being in test for almost a year, the company is launching its MySpace MyAds product in open beta tonight. The social network has been using what it calls hypertargeting to allow its brand advertisers capability to micro-target users with ads. But this expanded MyAds platform will allow anyone to create an account, choose from among 1100 niche categories, upload/choose creatives and start an ad campaign, targeting the 76 million U.S. MySpace users. This is a display ad system, unlike Google’s text based ad system (at least on its own site), but like Google and others, is a CPC system. Also, like Google, it has build an analytics tool for the self-serve users…from the screenshot I saw, it does look a lot like Google Analytics. It hypertargeting service allows advertisers to target ads based on the interest that MySpace users display on their profile pages. The new MyAds service allows targeting parameters such as age, sex, geographical location, combining it with user interest categories including specific keywords within each category. For example, within the ‘videogame’ enthusiast category, a further targeting keyword or phrase might include ‘Call of Duty 5’ if relevant to an advertiser’s campaign, the company explains.

Small Yahoo Investor Asks MSFT To Rebid At $22; Asking For Asia Spinoff; Shares Below $12 — At the rate it is going, $15 per share might sound enticing to Yahoo (NSDQ: YHOO) after a while. A small Yahoo investor Mithras Capital has put out a proposal asking MSFT to rebid for the company at $22 a share, reports Reuters. As part of a proposed deal, Microsoft (NSDQ: MSFT) would unload Yahoo’s Asian assets and non-search businesses, extract $3 billion worth of cost savings and receive $2.8 billion of tax benefits, which means MSFT will pay $10.3 billion for Yahoo’s search business (about $2 billion less than it was willing to pay earlier in the summer for search portion). It also calls for Yahoo to drop its poison pill, while valuing Yahoo’s Asian assets at $7.2 billion and its non-search business at $4.5 billion. Earlier this year Mithras backed Carl Icahn’s stake in the company. Yahoo’s shares hit a five year low yesterday, and today is down about 2 percent today to trade below $13. The Yahoo-Google (NSDQ: GOOG) ad deal is certainly going to be mired in regulatory issues in a while, and any Yahoo-AOL (NYSE: TWX) combination would also face somewhat similar regulatory issues.

Earnings: GE Q3 Earnings Meet Lowered Expectations; NBCU Profit Up 10 Percent — Late last month, General Electric chairman and CEO Jeff Immelt lowered the company’s Q3 guidance dramatically and today it met those expectations. We’ll see if the inoculation—and the subsequent infusion from Warren Buffett—helped when the market opens. In the meantime, a quick look at the results: Earnings from continuing operations dropped 12 percent to $4.5 billion from $5.1 billion on Q307, with a corresponding 10 percent decrease in earnings per share to 45 cents from 50 cents. (Including all operations, earning dropped 22 percent.) Revenues from continuing operations were $47.2 billion, up 11 percent over $42.5 billion in the same quarter last year. Growth in infrastructure and media were countered by a sharp decline in financial services.

RBI Sale At Risk Of Falling Through As Bidding Price Drops To $1.7 billion — Reed Elsevier’s troubled attempt to sell-off its UK B2B division Reed Business Information appears to be in big trouble with the news that bids for the company since August have fallen about a half-million dollars, according to Bloomberg. Two unidentified sources close to the deal told the news service the bids have dropped to about $1.7 billion (£97 million) from $2.3 billion (£1.3 billion). The company has struggled to attract the financing needed to seal the deal since the sale was announced in February. Merrill Lynch analyst Paul Sullivan said in a note that the risk of the sale “being delayed or falling through has clearly increased”. The markets were unimpressed and shares in Reed Elsevier dipped 6.4 percent to 468.25 pence at 1.34pm in London trading today, its lowest value since February 2004.

Time CEO Anne Moore Rules Out IPC Media Sale; Announces Two-Year Plan to Counter Downturn — She might run the biggest magazine company in the world in a time of falling advertising revenue and dwindling sales, but Time Inc’s (NYSE:TWX) CEO and Chairman Anne Moore doesn’t sound too concerned. She tells The Times of a two-year strategy to get her company, owner of consumer UK magazine publisher IPC Media, through the downturn—which will look to address its nine percent Q208 drop in ad revenue. Digital revenues grew 73 percent in 2007 and now make up 15 percent of the group’s total ad revenue. Moore considers Time not a magazine publisher but a “content company” But as The Times’s Dan Sabbagh writes: “Nevertheless, print magazine advertising is heading south this year, and digital growth in 2008 will miss the previous 53 per cent target”.

Economic Meltdown Strikes Viacom, CBS Corp.; Both Warn Investors On Lowered Outlook — It looks to be a brutal Q3 reporting season: Both Viacom (NYSE: VIA) and CBS (NYSE: CBS) Corp have cut their respective outlooks, warning investors that they have been taking a hit on the ad slowdown and the wider economic pain touching all businesses right now. Reuters: Viacom’s Q3 earnings will come in at least 10 percent short of Wall Street estimates. The company pinned the decline on the worsening ad revenue picture. That news quickly shot Viacom’s stock down 20 percent. Viacom Chief Executive Officer Philippe Dauman issued a statement saying the media giant, which owns MTV Networks and Paramount, was “moderating our near-term targets” in light of the dismal economy. In its Q2 earnings report, Viacom pointed to both retail and automotives categories as the reason for lower than expected revenues at its cable TV properties. While they held back on strong prediction for Q3, it’s clear they couldn’t foresee how bad things have gotten. Neither have financial analysts, who keep revising their forecasts downward. In a statement, the company is forecasting a 2 percent drop in global ad revenues, with a decrease of roughly 3 percent in the U.S. and an 8 percent gain internationally. The company will release its full Q3 results on Nov. 3.

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