Message From Michael -- February 11, 2008

GOOGLE VERSUS MICROSOFT – REVERBERATIONS AND RECRIMINATIONS

BROADCAST NETWORKS VERSUS CABLE NETWORKS

TRANSITION AND CONFUSION IN TELEVISION

THE U.S. VERSUS THE U.S.S.R. AGAIN

THE $500 BILLION BROADBAND PENETRATION

NEWS OF THE WEB WEIRD

COCKTAIL CHATTER


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GOOGLE VERSUS MICROSOFT – REVERBERATIONS AND RECRIMINATIONS: Not surprisingly, Google officials are warning a Microsoft takeover of Yahoo! would destroy Internet openness and innovation. Even less surprising, Microsoft officials say it would increase competition rather than reduce it. All that said, more figures have been released by Hitwise, comScore and Nielsen showing where the three behemoths stand. According to Hitwise, the market share of U.S. visits for Microsoft and Yahoo combined would be 15.6% of all Internet visits, with Google at 7.7% based on the week ended January 26th. However, Google accounts for 66% of all U.S. search volume while Yahoo and MSN Search combined would total 28%, according to December figures.

But, and here is where I don’t understand why Yahoo would be considered vulnerable, Yahoo has 71.4% of the U.S. market in portal front pages (MSN has 15.43%); Yahoo has 54.63% of Email services in the U.S. while Windows has 25.54% and Gmail has 5.51%; Yahoo News accounts for 7.38% of the market share in the news and media category for its Yahoo News, while MSNBC has 3.84%; Yahoo Finance has 29.15% of the business information category with MSN Money accounting for 10.14% of the U.S. market share; Yahoo Shopping has 8.68% of the rewards and directories categories followed by MSN shopping with 1.16%; Yahoo hotjobs accounts for 11.18% of the employment category; Yahoo Movies accounts for 8.33% of the movies category and so on and so on. Add to that the fact that Yahoo is far and away the leader in share of display ads with 18.8% of the market compared to Microsoft’s 6.7% and Google’s 1%, and I don’t get it.

In the end, if the two merge, Nielsen Online VP Ken Cassar says the combined entity would be visited by 86% of all U.S. Internet users, account for 15% of all time spent online and represent 59% of all online display ad impressions sold – the most significant revenue generator for most online publishers.

And for a different perspective altogether, Raycom Media CIO Dave Folsom reminded me of the flash online movie Epic2014 created for the Museum of Media History. An updated version of this prescient or pessimistic (depending on your perspective) look in the future, Epic2015, can be seen at http://epic.makingithappen.co.uk.

BROADCAST NETWORKS VERSUS CABLE NETWORKS: The four major Broadcast networks average a full minute more of advertising per hour than the leading cable networks, according to a study by the Kaiser Family Foundation. The main purpose of the study was to look at the amount of Public Service Announcements carried by the networks. As has been reported, the study found that less than one half of one percent of all air-time went to PSA’s (about 17 seconds an hour), roughly the same as it was five years before. And most of that (46%) was show in the hours from Midnight to 8:00 a.m. But also buried in the report was an analysis of non-programming content (ads, promos, psa’s, infomercials and ‘filler.) The time spent on ads has gone up an average of 24 seconds on the major broadcast networks (ABC, CBS, Fox, NBC) in the five years from 2000 to 2005, but a whopping 50 seconds on the cable networks measured (CNN, ESPN, MTV, Nick and TNT). Still there is a full minute more of advertising per hour on the broadcast networks (13:36) compared to the cable networks (12.30). Both groups have reduced the amount of time spent on promos in that time period, but they are both about the same -- 2:17 an hour on broadcast networks compared to 2:14 seconds on the cable networks.

ABC averages the most time on ads (14:05), just slightly more than NBC (14:01), but significantly more than CBS (13:21) and Fox (12:56). ABC also spent the least amount of time on promos (2:01), followed again by NBC (2:16) which in turn is closely followed by CBS (2:17) but with Fox spending the ‘most’ time (2:37). Fox had the highest amount of ‘non-programming content’, much of that infomercials (5:36) which was more than three times any of the other broadcast networks. The five cable networks measured had no infomercial time, according to the study. Interestingly, the network with the least amount of advertising was Univision with an average of 7:15 per hour, and even more interesting Univision had the highest promo time of any network (5:05).

TRANSITION AND CONFUSION IN TELEVISION: Those are the two words used to describe the state of television in a report summarizing a panel discussion held by the Peabody Awards. The report likens the ‘new’ news environment to a “giant media echo chamber” in which viewers only see and hear what they want to see and hear. Viewers may get more information and ‘varying perspectives’ through fiction and documentary work than in traditional news presentations. Add to that a process the report calls “viralization” in which we don’t have to go get the news, it comes to us, often from other viewers. Gone are the days when television contributed to a shared sense of national community. Despite all that, the report says quality television still exists. But if television is going to contribute to public culture, industry leaders, policy makers and citizen groups must work toward the creation of “media commons” to make sure differing groups can exchange ideas and understand each other, rather than “retreat into gated communities for the like-minded.”

THE U.S. VERSUS THE U.S.S.R: The two former Cold War enemies are again competing on the world stage, but it’s not so much about Vladimir Putin and George W. Bush, as it is about Information and Communications Technology. Both scored #1 but in different areas for different reasons. Even more surprising is that countries that you hear so much about in terms of ICT (such as India and Korea) scored poorly. A professor at the London Business School along with global economic consulting firm LECG have created a “Connectivity Scorecard” which looks not just at the infrastructure and technology in each country but “how usefully connected” the consumers, businesses and governments in those countries are and what that means to economic growth. The study makes the point that it is widely accepted that modern economies are information economies but in reality ALL economies are information economies now, and that “optimizing connectivity usage is the best source of future economic growth.”

America scored first out of 16 “innovation driven” economies (what we would call developed countries) while Russia scored first out of 9 “efficiency and resource driven” economies (commonly called emerging or developing countries.) But even in first place, the U.S. only scored 6.97 out of 10, followed by Sweden (6.83), Japan (6.8), Canada (6.5), Finland (6.1), the U.K. (6.1), Australia (5.93), Germany (5.52), France (5.07), and Korea coming in at tenth (4.78) In the other group, Russia scored 6.11 out of 10, followed by Malaysia (5.82), Mexico (4.37), Brazil (4.28), South Africa (4.11), China (3.42), Phillipines (2.38), India (1.68) and Nigeria (1.01). The report says Korea needs to figure out why its businesses spend so little on enterprise telephony and IP applications, that India has to improve performance on basic literacy and access measures, and the U.S. needs to improve general broadband penetration and affordability.

THE $500 BILLION BROADBAND PENETRATION: The “connectivity scorecard” cites previous studies that improving broadband penetration in the U.S. could have an economic impact of upwards of $500 Billion. However, the LECG report’s call for improving broadband penetration in the U.S. runs counter to another report by the National Telecommunication and Information Administration which says broadband penetration has improved dramatically, growing 1,100 percent in the past eight years. The report by the agency, which is part of the U.S. Commerce Department credits the improvements to the the Bush administration’s policy of “taking the government out of decisions more appropriately left to the marketplace… clearing away regulatory obstacles… tax relief… seed-funding… (and its) pro-investment… deregulatory policies.” It should be noted that critics charge that the administrations’ definition of broadband as 220 Kilobytes per Second is only four times dial-up speed and barely fast enough to allow streaming video. It should also be noted that the Organization for Economic Co-operation and Development ranks the U.S. 15th in broadband penetration, but U.S. officials say that does not take into account the large rural areas in America and the number of WiFi hotspots in the U.S.

NEWS OF THE WEB WEIRD: This may become a new MfM feature – a look at weird and sometimes wonderful websites that tell you something about where the Internet is going. For example, four guys in Scotland have created a site which allows you to bet on news stories. And even though the creators are in Edinburgh, the stories are focused on U.S. news. You sign up at the site, hubdub.com, and you get $1,000 in play money that can only be used on the site. Then you can bet on everything from the mundane (who will be elected President) to money matters (will the Dow Jones average fall below 12,000 today) to minutiae (who will be voted off Episode 2 Survivor 16) to the macabre (will more than 50 people be killed by a single suicide bomber in Pakistan). Meanwhile, website haveyougotthenerve.tv is looking for 3,000 ‘executive producers’ who will plunk down 60 English pounds to become part of an experiment in crowdsourcing, in which they are all part of a TV production company creating programs. And before you dismiss it as some sort of ponzi scheme, the creator, Mark Bowness, is the same person who created Tribewanted, a global tribe developing a sustainable eco community on an island in Fiji. Thinking a little more modestly? Then consider website itsmy.com where you can create your own personal mobile TV show using your content and the site’s sound files, avatars and animations for uploading and downloading.

A FINAL NOTE: From the people who brought you meter madness and ratings rubble comes a new idea. Nielsen Media has announced a ‘strategic investment’ in NeuroFocus, a firm specializing in applying brainwave research to advertising, programming and messaging. Susan Whiting, Executive Vice President of Nielsen, is quoted as saying the ‘alliance’ will allow Nielsen to gather unique insights about consumer attitudes and behavior, “but which they themselves may not even be fully aware.”

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