Google Inc. is counting on the crown jewel of its online advertising empire to burnish a diamond in the rough.
Hoping to take an even bigger bite out of ad budgets, Google has melded the technology powering its lucrative search marketing network with a system that it bought 18 months ago to sell online billboards and other more visual commercials, including video.
The long-awaited combination poses another threat to Yahoo Inc., whose profits have been sliding the past three years. Yahoo is the Internet’s largest seller of display advertising, a mantle that Google has set its sights on. Microsoft Corp. and Time Warner Inc.’s AOL also operate large exchanges that help manage display ads.
The upgrade announced Friday has been something Google has been working toward since it bought DoubleClick Inc. for $3.2 billion a year-and-a-half ago. Google prized DoubleClick largely for its tools for selling and serving display ads.
Although they are more dynamic, display ads so far haven’t proven to be as popular as the text ads that appear alongside search results.
Last year, online search advertising sales in the United States totaled $10.5 billion, according to the Interactive Advertising Bureau, with most of that money going to Mountain View, Calif.-based Google. The Internet’s U.S. display ads totaled $7.6 billion.
“The display market today is probably not really living up to its full potential,” said Neal Mohan, a Google vice president of product management.
Google is betting it can sell more display ads by drawing on the science, simplicity and ease-of-use that has made its search advertising system so profitable. The marriage will open DoubleClick’s display advertising system to hundreds of thousands of advertisers and Web sites that belong to AdWords and AdSense — the cornerstones of Google’s commercial search.
“We are going to be bringing a lot of the know-how and a lot of the efficiencies of the search market to the art of display,” Mohan said.
DoubleClick’s display exchange matches up advertisers with Web sites trying to sell some of the empty space on their pages.
It’s an approach pioneered by four-year-old Right Media, which was bought in 2007 by Sunnyvale, Calif.-based Yahoo for $526 million. Yahoo says Right Media remains the Internet’s largest display advertising exchange, processing 9 billion daily transactions for 120,000 buyers and sellers around the world.
Yahoo doubts Google will be able to dominate display advertising like it has search advertising.
“We fully expect the display market to be fragmented and for there to be other exchanges,” said Frank Weishaupt, Yahoo’s vice president of North American marketplaces. “We welcome these exchanges, and look forward to working with them and integrating with them for our partners.”
Ron Cicero and Bo Clancey Launch Production House 34North
Executive producers Ron Cicero and Bo Clancey have teamed to launch 34North. The shop opens with a roster which includes accomplished directors Jan Wentz, Ben Nakamura Whitehouse and Mario Feil, as well as such up-and-coming filmmakers as Glenn Stewart and Chris Fowles.
Nakamura Whitehouse, Feil and Fowles come over from CoMPANY Films, the production company for which Cicero served as an EP for the past nearly five years.
Director Wentz had most recently been with production house Skunk while Stewart now gains his first U.S. representation.
EP Clancey was freelance producing prior to the formation of 34North. He and Cicero have known each other for some 25 years, recently reconnecting on a job directed by Fowles. Cicero said that he and Clancey “want to keep a highly focused roster where talent management can be one on one--where we all share in the directors’ success together.”
Clancey also brings an agency pedigree to the new venture. “I started at Campbell Ewald in accounts, no less,” said Clancey. “I saw firsthand how much work agencies put in before we even see a script. You have to respect that investment. These agency experiences really shaped my approach to production--it’s about empathy, listening between the lines, and ultimately making the process seamless.”
34North represents a meeting point--both literally and creatively. Named after the latitude of Malibu, Calif., where the idea for the company was born, it also embraces the power of storytelling. “34North118West was the first GPS-enabled narrative,” Cicero explained. “That blend of art and technology, to captivate an audience, mirrors what we do here--create compelling work, with talented people, harnessing state-of-the-art... Read More