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Google To Buy Radio Advertising Firm
M3rk1n_Muffl3y writes "According to the BBC Google is buying US radio advertising firm dMarc Broadcasting for an upfront payment of $102m (£58m), rising to a possible $1.14bn by 2009. Interestingly it comes soon after Robert X. Cringely's prediction that Google will soon expand into targetted TV adverts. It looks we are finally beginning to see Google's transition to mainstream media."
I had to stop advertising on the radio last year -- it was declining returns. On my last (contractually required) run of ads, I paid over US$800 per customer earned. Considering I only profited about US$100 per year off of my average customer, radio was a dead form of advertising. This is on a 50,000 watt station in a major metropolitan area. My neighbors in business who kept their ads running this year only do so out of contractual obligation (5 year contracts offered almost 50% discounts). Almost everyone else still advertising on that station is the next batch of businesses ready to fail. The ad-sales people are that convincing.
Google is probably stupid to get into this business. I don't listen to the radio anymore, and I doubt many kids half my age do anymore either -- the iPod is that strong. The frequencies used for public broadcast radio seem wasted to me -- I'd rather see them deregulated and offered for another WiFi band. More WiFi means more access to streamed content as I need it. Hell, I stream MP3s to my PDA already via my Bluetooth-enabled EDGE-bandwidth cell phone (150kbps low latency all over Chicagoland).
So what does Google know that I don't? I'm sure a lot, but I can't see them being right in this situation. Maybe they're ahead of where radio will be in 10 years -- is it possible we'll see the large radio cartels end their regime, replaced with smaller stations all over the place? Could Google perform real time contextual advertising on 5000 watt stations, targeting listenes better?
Google's advertising engines don't work well on pages with too much variety it content. I see 50,000 watt stations having the same problem -- they're targeting too many different customers (and seemingly targeting them with the same generic content on 8 different stations).
How do Google's ads translate to those without sight? Radio only works as an audio mechanism, so Google's visible advertising campaign won't work here, either.
I can see Google's future in buying a company like Clear Channel -- they own most of the billboard advertising in Chicagoland, and they are also advertising in nightclub bathrooms and on the doors of toilets in office buildings. Google can find a way to digitize these ads. Is it possible that dMarc Broadcasting does more than radio (like Clear Channel)?
If it is just radio ads, I don't see it. Wasted bandwidth for a product that can't keep up with what the current customer base needs.
I was listening to an episode of This Week in Tech the other day and Leo kept mentioning someone's theory that Google's true goal is to get AdSense everywhere. This move just seems to back up that claim.
Be a real patriot: Question authority. Think for yourself. Formulate your own conclusions.
"Google's transition to mainstream media"
No, we are seeing Google's transition to ALL media.
Think what you will of such things.
"Hell, I stream MP3s to my PDA already via my Bluetooth-enabled EDGE-bandwidth cell phone (150kbps low latency all over Chicagoland)."
Clearly, you're in touch with the same reality that all other US citizens inhabit.
Granted, not as many people listen to radio nowdays. But it's not completely dead. It's still everywhere, and everyone has access to it. Believe it or not, even having a broadband connection at home puts you in the minority, buddy.
Han shot first.
It's still everywhere, and everyone has access to it. Believe it or not, even having a broadband connection at home puts you in the minority, buddy.
Of course I am. I don't want to get into my usual anti-copyright debate today, but copyright gives the content cartels control of the media schemes use to publish content -- keeping streaming companies from being as competitive as the radio cartel.
If streamers had the ability to offer content as cheap as the radio can (in terms of paying off the content thugs), you'd better believe we'd have lobbyists trying to shut radio down and bring in more wireless bandwidth.
I read TFA, but im still not clear on how they plan on using the radio to target listeners in a way which would be different from the current advertising schemes. Obviously, when you search on google, they can use your query to deliver targeted relevant advertising results. However, with radio, the only information they have is that a quantity of people are listening to a specific frequency.
Clearly, I must be missing something. Right?
--
http://www.wi-fizzle.com
Censorship is obscene. Patriotism is bigotry. Faith is a vice. Slashdot 2.0 sucks.
To suggest that the internet isn't mainstream only means that someone is showing their age.
Watching the Nightly News is simply a chance for me to discuss the day's events with other people. I've already read all the 'big' stories of the day by 6/7 o'clock and I usually get more details to boot.
The newspaper does a bit better, as they can dedicate more space to details and they have much more local information, but even then, I'd still rather scan two or three online articles to get a variety of viewpoints.
Because of the internet, I get a much better idea of what's really going on.
[Fuck Beta]
o0t!
While I agree that iPods and other personal media players are becoming the norm, I'm 18 and I strongly disagree with the opinion that radio is becoming a dead medium. While I listen to my MiniDisc player at the gym, on the bus, etc, I still listen primarily to the radio while driving to and from work every day. Apart from the music my favorite station plays, I also find invaluable the traffic and weather reports, news, concert info and also the contests they offer. Car radios are basically the only ones I use, but when in a car (especially alone,) the radio is still an excellent broadcast medium. Many radio stations are now allowing listeners online through their websites in real time, and I believe this only enhances their listener base. Google must have some faith in this, or they wouldn't be investing with that amount of money.
Google ads sandwiched by pay-to-play music and infotainment talk radio, sounds like a bad business model to me. But since they have tons of money to spend, what do they have to lose?
PS anything that says 'targeted' immediately brings up privacy concerns.
He who knows best knows how little he knows. - Thomas Jefferson
Anyone who spends enough money on Google ads can tell you the first name of their sales rep at Google. You know, the person who helps you fine tune for AdSense keywords, and offers you swell deals. How about if that person, who is already also helping you with localized ad placement through AdSense, could guarantee you some airtime in your local market, as well? Or, how about making sure that people sitting in their cubes at work listening to the radio and typing in some regionally interesting search term ("pizza delivery Sterling, VA") could be shown normal AdSense ads that, for the window of time that Joe's Pizza is running broadcast ads in that ZIP code, give extra weight to his AdSense ads for localized search?
Come on, folks, there's more to this than meets the eye. And don't forget the side-band stuff that handles traditional pager traffic, too. That can be used for all sorts of exotic ad-related things.
Don't disappoint your bird dog. Go to the range.
Before continuing I should note that I was one of those who (incorrectly) predicted Amazon.Com's demise. Amazon was (is?) carrying $2 billion in junk bond debt. I could not see how they could ever crawl out of that hole. Clearly I was wrong. Looking at Amazon now I see four things:
A direct retailer of books, electronics and other products.
A software company that sells its software and infrastructure to support other vendors retailing.
An internet infrastructure company that can sell time on its computer network "farms" and bandwidth pipes.
A huge "bricks and mortar" distribution chain for books and other products. This distribution chain can also be "rented" in part to support other vendors.
When you compare Amazon and Google, you can see how weak Google really is. While Amazon is very much a software company, Google is rapidly becoming nothing more than an advertising/media company. However, the problem that Google has is that their business model is easily subject to attack by competitors. While Amazon has a difficult to replicate business because of the cost of it's infrastructure (software, internet and bricks and mortar distribution) Google pretty much has one thing: it's search engine. The search engine is under attack by Amazon (with their A9 search engine) and Microsoft, among others. The only real defense Google has is slightly better results and force of habbit (I use Google because I'm used to using Google). Right now Google has a big pool of cash from the stock market. But they remain vulnerable to competitors and they have no other revinue stream to fall back on.
Google seems to be attempting to take their pool of cash and diversify deeper into media and advertising. Presumably the objective is to give them a revinue stream like Amazon's, that cannot be easily attacked. But this evolution takes Google farther from being the leading edge technology software company that many Googlistas still seem to think they are.
Having been very wrong about Amazon, I fear making any predictions about Google's future. But it is tempting to say that they are following an Internet model where everything happens faster. In their case the rise to bloated egos beleiving their own press ("we're all brilliant") to business decline as their revinue growth stagnates and their attempt at expansion gets mired in the difficulty of expanding into advertising and media.
Also a good point to note, is that with the advent of Satellite radio with no commercials, who's going to put up with radio for that much longer.
,particularly if they're already paying Howard Stern millions upon millions. You don't think other radio personalities won't want a piece of the pie ?
Exactly how much longer do you think Satellite radio will be commercial free? Cable started out the same way and now the only channels that are any different than over-the-air channels are the pure premium channels.
Satellite radio will surely go to this model
Trust me, it's only a matter of time.
-- You see, there would be these conclusions that you could jump to
Satellite radio has poor audio quality. If you're willing to pay $15/m for that, then I see the marketing beast has already eaten you. Personally I listen to public radio (news, chamber music, Car Talk, Prairie Home Companion) anytime I'm in the car. If I wanted pay for music, I buy CDs, encode them to a suitable format (FLAC, Musepack, AAC LC, MP3) depending on target, and listen to that. It's cheaper, it has better audio quality, and I'm not constrained by programming.
Maybe, just maybe they're hopping they can use the radio stations for very wi-fi.
What those who want activist courts fear is rule by the people.