Social, Mobile, Social TV, Digital, Internet far reaching consequences & Trends dt 28th May 2014
Effective Marketing Critical for US Telecoms to Remain Relevant
The telecom industry is the fourth-largest spender on digital advertising in the US, according to a new eMarketer report series on industry-by-industry digital ad spending. However, growth rates lag
almost all other verticals, and telecom faces challenges that will affect how it approaches digital advertising.
Why Are Publishers, Media Buyers Excited About Programmatic Guaranteed?
The amount of digital display ad dollars spent on programmatic guaranteed is rising. According to a new eMarketer report, this branch of programmatic direct is gaining significant traction among
publishers and media buyers looking to automate the sales process and bring greater audience insight to their premium ad buys.
Tablet TV Trend Continues to Grow in the UK
Majority of digital video ad views come via long-form content
May 28, 2014
Digital video ads served to a UK audience are more likely to be viewed on tablet devices than those served in the US, at least according to data from FreeWheel. The May 2014 report
noted that tablets accounted for 17% of total digital video ad views (of ads served through the company’s network) in the UK in Q1 2014. In the US, tablets claimed a share of just 7%.
Tablet penetration in the UK remains on an upward trajectory. eMarketer estimates that 41.1% of the entire UK population will be tablet users in 2014, and that total will reach 57.8% by
2018. This is at least partly influencing the rising share of video ad views on these devices. But the UK figures aren’t too dissimilar to eMarketer’s US tablet penetration figures: 46.2% in
2014 and 52.1% by 2018.
Something else is clearly at play, and further findings from the FreeWheel study help explain a marked difference in tablet video viewing behavior in the UK. In another sharp contrast
with the US, a far greater proportion of video ads in the UK were viewed during the consumption of long-form content in Q1 2014—73% vs. 53%.
The digital video landscape in the UK—specifically in the TV space—is particularly well established, with most of the main terrestrial and pay TV broadcasters offering extensive on-
demand viewing options. And UK viewers have been taking to TV on tablets for some time.
And not only does this type of TV behavior compare favorably with the US, the UK also overindexes against most other European countries. According to February 2014 polling by Ipsos
OTX and Ipsos Global @dvisor, 25% of internet users in Great Britain typically watched TV via video-on-demand services, a proportion well above the other countries polled, while
viewing via a mobile stream was cited by 12% of respondents—only Sweden could match that figure.
- See more at: http://www.emarketer.com/Article/Tablet-TV-Trend-Continues-Grow-UK/1010869/7#sthash.AZbDPhQn.dpuf
Online Ad Spending in Europe Topped €27 Billion in 2013
Mobile posted the largest gains, with expenditure up more than
128% over 2012
May 29, 2014
Several European countries are still struggling economically, but the region’s digital ad market is booming. According to the Interactive Advertising Bureau Europe and IHS, digital
advertising spending in Europe rose 11.9% last year to total €27.3 billion ($36.4 billion).
Mobile advertising showed the most dramatic rise, with expenditure 128.5% higher than in 2012. As a result, the channel accounted for 11.5% of all digital ad spending—the first time its
share rose to double digits.
Online video advertising also grew sharply, rising by 45.4% in 2013 to nearly €1.19 billion ($1.59 billion)—another first, as Europe’s investment in online video ads had never before
reached the €1 billion ($1.33 billion) mark.
Spending on display ads continued to gain momentum, logging higher growth than any other format, at 14.9%, and a total value of €9.2 billion ($12.27 billion). But spending on search
remained greater overall, at €13.4 billion ($17.87 billion), and rose almost as much (13.0%).
The Ex-Banker Behind the $3
Billion Apple-Beats DealBy Adam Satariano May 28, 2014
Photo illustration by 731
Apple (AAPL) is arguably the most famous company in the world, but its top dealmaker prefers to stay in the shadows. Adrian Perica, a formerGoldman
Sachs (GS) banker, sometimes holds meetings with executives of companies he’s interested in buying at an unmarked building adjacent to Apple’s Silicon Valley
headquarters, according to two people who have negotiated with Apple. Such precautions are warranted: A February report in theSan Francisco Chronicle that Perica had
hosted Tesla Motors (TSLA) co-founder Elon Musk at Apple’s main campus set off a frenzy of speculation that the iPhone maker was considering buying the carmaker.
“When you’re the gatekeeper at a company like Apple, that puts you in a very valuable position,” says Eric Risley, a managing partner at mergers-and-acquisitions advisory
firm Architect Partners, who has pitched Apple on deals.
Since joining Apple in 2009, Perica has upped the pace of dealmaking, culminating in the $3 billion purchase of Beats Electronics, the headphone maker and music
streaming service founded by rapper and hip-hop artist Dr. Dre and music industry veteran Jimmy Iovine. Perica “is trusted inside the company and built a track record of
getting things done,” says John Malloy, a general partner and co-founder of BlueRun Ventures, which invested in Topsy Labs and Chomp, startups acquired by Apple in
the past three years.
The Beats deal is Apple’s biggest to date. Spending on acquisitions jumped 87 percent last quarter, to $559 million, according to an April 24 regulatory filing. That month,
Chief Executive Officer Tim Cook said Apple had bought 24 companies in the previous 18 months. It made just two known acquisitions in 2009.
STORY: Apple Buys Beats and Its Founders for $3 Billion
Perica’s responsibilities are growing under Cook, who unlike Apple co-founder Steve Jobs is willing to dip into the company’s $151 billion cash pile to buy companies
developing new products and services, amid slowing sales of iPhones and iPads. Apple has been acquiring startups and then shutting them down in order to redeploy
employees and technology inside the company. It bought HopStop.com and Locationary in 2013 to improve its buggy mapping software, and the fingerprint-
authenticating know-how of AuthenTec, bought in 2012, has been channeled into the iPhone 5S.
Unlike other technology giants, Apple has rarely indulged in big-ticket purchases. In the past year, Facebook (FB) paid $19 billion for messaging service
WhatsApp,Microsoft (MSFT) bought Nokia’s handset business for $7.2 billion, and Google(GOOG) spent $3.2 billion on thermostat maker Nest Labs. Until now, Apple’s
biggest acquisition was its $404 million purchase in 1997 of Next Computer, the company Jobs started after he was forced out of Apple.
Perica was hired after Apple tried to acquire mobile-advertising company AdMob in 2009 but lost to Google. Until then, the company’s approach to buying companies had
mostly been subject to the whims of Jobs. Perica was recruited so Apple could move more quickly on deals. He has since built a rapid-reaction force of former investment
bankers and MBAs. “Compared to many other public companies, it was a more professional and streamlined process,” says Fred Wang, a principal at Trinity Ventures,
which was an investor in WifiSlam, a mapping-software company that Apple acquired last year. Perica’s team, which on some deals has swelled to include more than 100
staff from across the company, is so well equipped that Apple was able to dispense with the coterie of Wall Street advisers that usually turns up for transactions of this size.
Perica declined to answer questions for this story, and Apple declined to divulge any information about him beyond his date of birth. (He’ll turn 42 in November.) “They
put a premium on secrecy that is legendary,” says BlueRun’s Malloy. A West Point graduate, Perica worked as an intelligence officer in the U.S. military and as a
consultant for Deloitte before getting his MBA from Massachusetts Institute of Technology’s Sloan School of Management. In a 2001 interview with an MIT publication,
Perica copped to having been a wallflower. “Socializing used to be very hard for me,” he said. “But developing good social skills really gives you confidence.”
VIDEO: Apple's Five Most Breathtaking Stores
Kenneth Morse, who was one of Perica’s professors at MIT and now runs Entrepreneurship Ventures, a firm that advises high-tech startups, says his former student stood
out. “Some MBAs are pretty self-centered. He’s not.”
Perica is close with members of Apple’s executive team and has been spotted at Golden State Warriors basketball games in seats usually reserved for Apple Senior Vice
President Eddy Cue, who has season tickets. Acquaintances say he isn’t interested in the Valley’s social scene. “Adrian isn’t cut from the same cloth as a lot of Silicon Valley
corporate development types,” says Matt Murphy, a partner at venture capital firm Kleiner Perkins Caufield & Byers, which has done deals with Apple.
Those who’ve sat across the negotiating table from Perica say he’s a straight shooter who’s wary of overpaying. One entrepreneur, who spoke on condition of anonymity for
fear of harming his relationship with Apple, says Perica told him that his employer wasn’t interested in his product or the underlying technology, and just wanted to bring
his team onboard to work on a future product. He also offered a lower price than other suitors. The company decided to sell itself to a rival.
The UK topped the list of the most valuable digital ad markets in Western Europe, followed by Germany and France. But across Europe as a whole, the most impressive growth was seen
in Russia (26.8%) and Turkey (24.3%)—where online platforms were just beginning to realize their potential for advertisers and brands.
eMarketer estimates that digital ad spending in Western Europe will approach $32 billion this year; the UK is expected to account for more than one-third of that amount.
- See more at: http://www.emarketer.com/Article/Online-Ad-Spending-Europe-Topped-27-Billion-2013/1010870#sthash.csXERRLx.dpuf
Social Network Ad Spending Approaching the Half-Billion Mark in
Twitter struggling with only 28.0 million active users, compared
with Facebook’s 208.9 million
May 28, 2014
eMarketer expects 227.4 million people in Latin America to be social network users this year, representing just over one-third of the region’s population and 68.8% of internet users. The
number of people who access a social network via any device at least monthly will expand to 254.4 million in 2015 and 311.8 million by the end of our forecast period.
Meanwhile, the number of active Twitter users is set to reach 28.0 million this year. Regional giant Brazil will be, as usual, the largest contributor to that tally, with 12.7 million Twitter
users in 2014, followed by Mexico’s 7.7 million.
Argentina, however, leads by Twitter user penetration among internet users, boasting a 13.7% reach this year that will grow fastest among the individual markets forecast by eMarketer to
reach 21.1% by 2018.
Outside of the top three economies in the region, Twitter uptake will be limited to 3.9 million people.
Meanwhile, top social networking competitor Facebook will solidify its leading position when it reaches 208.9 million users in the region this year, one-third of them in Brazil alone (70.5
million). We expect Mexico to have 44.4 million Facebook users, ahead of Argentina’s 18.2 million. But more importantly, Facebook has branched out to the rest of the region, and there
will be 75.9 million people logging in from countries like Chile, Colombia, Peru and Venezuela.
Active user bases are key for marketers to understand the reach of their social media budgets in a region that will approach the half-billion-dollar mark in social network ad spending in
2014. This year’s growth (9.1%) in the category will be followed by a 9.6% improvement in 2015, when eMarketer predicts $593.6 million will be devoted to social network ads.
While Facebook has been able to establish a rock-solid lead in nearly any metric in the region (except perhaps growth, given its saturation level), Twitter is struggling due to tough
competition from other traditional social networks and even texting and instant messaging services like WhatsApp, WeChat and LINE.
In Mexico, for example, The Cocktail Analysis found that 92% of daily internet users ages 18 to 55 were active Facebook users in December 2013. Google+ ranked No. 2, cited by 59% of
respondents, followed by WhatsApp’s 45% uptake—which rose to 73% among smartphone users. Twitter penetration came in at 41%. And when it came to Twitter’s “home turf”
category—social TV—The Cocktail Analysis found that Facebook users were the most likely to frequently post comments about video content they consumed (75%), followed by 62% of
WhatsApp users who said the same. By comparison, only 36% of Twitter and LINE users did so in the same period.
eMarketer bases all of its forecasts on a multipronged approach that focuses on both worldwide and local trends in the economy, technology and population, along with company-,
product-, country- and demographic-specific trends, and trends in specific consumer behaviors. We analyze quantitative and qualitative data from a variety of research firms,
government agencies, media outlets and company reports, weighting each piece of information based on methodology and soundness.
In addition, every element of each eMarketer forecast fits within the larger matrix of all of its forecasts, with the same assumptions and general framework used to project figures in a
wide variety of areas. Regular re-evaluation of each forecast means those assumptions and framework are constantly updated to reflect new market developments and other trends.
- See more at: http://www.emarketer.com/Article/Social-Network-Ad-Spending-Approaching-Half-Billion-Mark-Latin-America/1010875/7#sthash.BoJvcRgH.dpuf
NBC Is Betting $7.65 Billion That It
Knows What TV Will Look Like in
2032By Joshua Brustein May 08, 2014
Photograph by Thomas Ccoex/AFP via Getty mages
The closing ceremony of the 2012 London Olympic Games in London on August 12, 2012
Fans of the Olympics are often in it for the tradition, and that includes NBC, the network that agreed on Wednesday to pay $7.65 billion for the rights to broadcast the
games on television and online until 2032. The network has been accused at times of letting its Olympic spirit get in the way of its bottom line. Now it’s betting not only
that it can make a good business of the games, but that it can do so while adjusting to the next 18 years of shifts in media consumption habits.
The Olympics have been a beloved moneyloser for NBC for decades. The broadcaster, owned by owned by Comcast (CMCSA), lost $223 million on the 2012 Summer
Games in London. Yet it extended its contract the next year, paying $4.4 billion for the broadcast rights to the Olympics through 2020. Critics said NBC got fleeced. ESPN,
one of the rivals outbid by NBC in 2011, released a statement at the time saying it had made a “disciplined bid,” adding that “to go any further would not have made good
business sense for us.”
NBC has made clear on repeated occasions that the Olympics broadcast rights aren’t just about money. The network has been showing the Olympic Games since 1964, and
thinks that doing so benefits its other programming. That halo effect is apparently worth a few hundred million dollars. NBC has also been steadily edging toward
profitability on the games. Just before the Sochi Olympics in February, it said it expected the games to be profitable. They probably were, after the company made $1.1
billion in Olympics-related revenue. The key to capitalizing further may be for NBC to spread coverage over more cable networks and Internet-connected devices.
STORY: NBC's $250 Million Bet on English Soccer Is Still a Scoreless Draw
Now the network is paying an average $1.275 billion for each of the next six Olympic Games, about 40 percent higher than the $880 million per game under the contract it
signed in 2012. (It pays more than that for the Summer Games and less for the Winter Games.) This isn’t an outlandish rate of inflation in the world of sports media rights.
When the company renewed its agreement to show National Football League games in 2011, it agreed to an increase of 74 percent, to $1.05 billion a year.
NBC is flying blind in some ways. It doesn’t know where future games will be or what time zones they’ll take place in. Any long-term contract like this is inherently risky,
because it’s not clear how people will be watching sports by then. They may still be watching the Olympics, but not only on television, a venue where NBC is comfortable
selling advertising. The contract is a leap of faith that the network can figure out how to replace any revenue it loses from a shift away from television with revenue from
online video advertising. Print media was hit hard when it was surprised by a similar dynamic. Television’s day of reckoning almost certainly lies between now and the end
of the contract NBC just signed.
The network is encouraging people to watch online. It says there was an eightfold increase in the number of cross-platform views at the Sochi Olympics, vs. the Winter
Olympics in Vancouver in 2010. Customized productions for TV and online audiences give NBC more content to offer advertisers. Like all Internet video operations, the
network is trying to figure out the advertising business online—as anyone who watched the same Coca-Cola (KO) ad over and over this February knows.
Mukesh Ambani to Buy Stakes in
Network18 and TV18
Indian Billionaire Paying $690 Million For Stakes In
Two Of India's Top Media Companies
R. JAI KRISHNA
May 29, 2014 11:08 a.m. ET
NEW DELHI—Indian billionaire Mukesh Ambani is buying stakes in two of India's top media companies-- Network 18 Media & Investments Ltd. 532798.BY +7.98% and TV18
Broadcast Ltd. 532800.BY +2.49% --for $690 million.
Reliance Industries Ltd. 500325.BY -1.16% , the energy and petrochemical company headed by Mr. Ambani, said Thursday that it had agreed to fund the 40 billion rupee acquisitions by Mr. Ambani's
Independent Media Trust. The two media companies are the partners of CNN, CNBC, Nickelodeon and others in India.
Independent Media Trust will use the funds to buy a 78% stake in Network18 and a 9% stake in TV18 before making open offers to buy larger stakes in both companies from shareholders.
Network 18 Media & Investments owns print, television and websites, and has investments in online business ventures. Its unit TV18 owns and operates news television stations CNBC-TV18, CNN-IBN,
IBN7 and CNBC-Awaaz. TV18 also has joint ventures with Viacom Inc., called Viacom18, to run general entertainment, music and children's television stations in India.
The deal will give Reliance Industries access to more video content and websites as it prepares to launch a high-speed broadband network which uses fourth-generation telecommunications technology,
through its telecom venture Reliance Jio Infocomm Ltd.
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