This is a continuation to a Post that I had written Earlier.

“Yahoo could emerge with an edge, if they leapfrog into other verticals following the same web-based advertisement network.”

For a company which has entrenched itself in the media space, managing advertisements networks i probably the holy grail. I wouldnt recommend that Yahoo give up that leverage. Instead of going head on with Google and losing out on that battle, all they need to do is leverage that asset in a different vertical.

I wrote about perhaps using advertising networks, especially multimedia (audio/video) ads in Radio and television networks. One could argue that the ad server requirements, the infrastructure requirement and cost of operations would significantly vary because of the medium. I’d agree to some extent. But there is also a way to deploy the already existing asset, as-is, into different verticals. Read on.

I am not sure how many of you are aware of the CSCs coming up. The Community Service Centres, or Common Service Centres, are essentially Internet kiosks, each fitted with a fairly decent hardware and broadband connectivity, and the idea is to utilize those as hubs to deliver services into Rural India. It could be anything from eGovernance, health, Banking, Telecommunications, etc etc. There are a lot of private bidders who have won the tenders for regions (so the service delivery will be upto par on standards), and organizations in the likes of 3i Infotech, Reliance, Comat etc have come into this.

So Whats the opportunity for Yahoo or Google in all this? Well, there is a computer and its connected to the internet. Find a way to build a lightweight application that acts as a screensaver, which would display advertisements – pulling it from the internet – when the computer is idling. The advertisement can be focused to the rural space, and there is everyone from the likes of HLL, to your Cellphone companies, dying to get the attention of that market share.

The reason why the operators would be open to this idea is simply because everyone is trying to figure out how to break even in this business. As you could imagine, Rural India and technology are like lotus leaves and water drops. They just dont have a history of blending so far. And there is going to be that initial adoption curve issue for these services to pick up. And as a means of ensuring that the Kiosk Operator has some viable means of keeping at it, advertisements, and complementary services begin to play a role.

I believe there is a company which recently started in this space, and got funded by Sequoia. But yep, its definitely a market to explore.

So I know that there are a gazillion guys out there in the whole wide world, who have given “open” advise to Yahoo as to what they should do. I am neither an expert, nor am vested into the company to have such generosity towards them

A friend of mine and I, over some conversations were discussing about some of the bigger brands that we see around us and something along the topics of Return on Equity. Not sure if you are aware of, but Microsoft has a 52% return on equity. Yahoo has roughly about 7% and falling drastically and Google has one which stands at around 26% – and growing steadily. Whatever you may say, Microsoft has played this game with a whole new set of balls and one most people simply won’t understand. And if you ask me, they are a much better company in terms of strategy and products compared to Google, anyday.

Yahoo could emerge with an edge, if they leapfrog into other verticals following the same web-based advertisement network.

But that’s not the focus of this post.

The conversation was that, if a company has Advertisement as its core strength and has built a competence in it, then its going to be very hard for the company to drop that and adapt the advertising network of its partner/rival. Well, for the case of survival they might, but since they do have the core competence, the resources and the minds that can think in that direction, what could they possibly do, was the question.

Fact: Yahoo makes most of its money via advertisement, and that too on banner ads.

This becomes an issue when you have so much internet portals and properties, but just simply have to fill them with advertisements in order to make them viable. And in this day and age of APIs, nobody might even come visit the site to get hit by the advertisement. You are forced to rethink in terms of strategically placing the advertisement within the content, but thats a very very hard thing.

My Take: I think this is probably the same route as making fiber out of rocks. There might be some way to do it, but whatever it is, its one rare, long process.

I’d say, flip the coin, and lets look out to the horizon. Go after other streams, television and Radio… to be precise.

So go down memory lane and you will remember how there was a time when all the internet properties used to have a sales team to go chase after advertisers and get them onboard and once the term was over the havoc began all over again. Most of them knew that they could make more money if they managed the deal directly with the advertisers, but the cost that went into chasing orders, and managing the clients was too much an ordeal that when the concept of advertisement networks came about, people were more than glad to give up a marginal cost to have these services “managed”.

It happened for the web medium, and it can happen for the television and Radio network as well. Because they face the very same problems.

If you don’t believe me, check out this company. There is a company named Spotrunner. What they do is that they build an inventory of ads that the local television operators, while doing the programming, can draw advertisements out of. I think thats a very neat bloody idea. I know of people who are running campaigns and they get the sweetest deals out of this television networks during “off seasons”. And when its off seasons, oh boy, the inventories are really bad that they’ll run just about anything to keep those media streams flowing. During rainy seasons, nobody wants to sell or buy cars, consumer goods etc, and that usually is what constitutes a large chunk of the advertisement revenue. So, they usually fill it up with fillers and Awareness Advertisements.

But imagine if… a centralized network would manage all the advertisements with vendors, create an inventory, and as broadcast partners sign up, all they would have to do is enter in the keywords for the show, and they’d see options of which ads they can play. They can pick, and queue it and go about their work. When the ad gets played, whatever amount was agreed upon with the vendor gets deducted from the advertising account – this could technically even be a prepaid account. Now this totally leverages the broadcaster, since he has options of playing an ad of a sponsor that they have, and use the flexibility of the ad inventory to fill whatever is required, and hence maximizing his revenue potential. If laziness is one to bet on, eventually they’ll scrap their sales force, and resort to doing programming with most of these advertisements running in.

This is also brilliant, cause imagine if there is a talk show happening and knowing how most programmers can flip through the show quickly, they can even generate keywords – manually, or there could be a simple app that extracts out the audio and picks up keywords, and can “suggest” advertisements that would make the most sense. THAT would be relevant advertising indeed.

I think television stations get away with it, by a little bit. But Radio stations really struggle. If you do the same for them, with just audio, they’d keeel (spelling intentional) over themselves for it. I have closely observed how some of these radio stations work, including the popular and well known ones and having friends in that circle, one only hears one thing over and over again – finding sponsors and advertisers is a tough job.

So you’d start with something like this, and move on to the second phase, and then there is even a third. That, we’ll talk about tomorrow.

But Yahoo, I really hope you’ll see this, and more so, I’d like you to come back to your former glory. I think my first email account ever was a yahoo one, and perhaps that bit of loyalty still runs.

‘Brand Equity’ seems to be a much spoken word these days. As per a recent report by the Economic times, India is the third largest economy when it comes to the advertisement industry, pushing China to become the fourth in time of scale and the cash-flow that is pouring in into that segment of the industry.

While at one end that is going on, people are looking at new ways of monetizing and revolutionizing this market. Whenever there is more cash than there is space to move, this always happens.

There are a couple of very interesting things happening:

1. Television is moving to the Internet.
This is a no-brainer. I guess with the success of Youtube and Homevideos and how even the common man seems to understand the concept of “The Long tail“, this is the most talked about subject.

What is to be noted is the difference between internet videos and internet television (or IPTV). It is simply not the same. While one is a web level aggregation of different videos, the other is using the internet as a medium to deliver high quality content, in a way that the web can afford to – multi-casting, at the same time unicasting. That’s when terms like microchunking, RSS Video feeds, personalization and Video on the go (with technologies such as slingbox) comes into play.

We’ve barely scratched the surface here.

2. Ads are taking on a new momentum.

Firebrand. Indibiz.tv
Two web based commercial channels. I mean, channels which show nothing more than commercials, but of course you get the pick of what advertisement you want to watch and when. Welcome to the world of asynchronous broadcasting. With the recent trend in advertisement directors outwitting the regular programming directors in terms of quality and content, this is said to be a new trend that is setting the stage.

Infact, Firebrand is being pulled together by the same guy who came up with the concept of MTV, back in the days when playing music videos were meant to be “nothing more than commercials for the bands who played the music”. Perhaps they aren’t that different.

3. Place-shifting technologies will flatten the media space.
Imagine being able to cross the boundaries of those that are defined by the broadcasting companies and being able to watch anything from across the world, when you want to see it. That’s simply amazing. This will be the driver in terms of pushing media to the web and in making IPTV a reality.

4. Watch only what you want.
Pure Youtube style. Different channels, which know your personalized settings and will only show you what you want to see. Even if I tune into BBC, If i am only interested in sports related news, I would be able to watch just that, and not need to listen to the quibber of anything else which might not be of my fancy.

5. Alternate Revenue models
I am not too sure if the Youtube model is going to sustain itself. Google is converting that as a aggregation point for bigger broadcasters to push their own content in the internet medium. But if the home videos that made Youtube what it is, is to continue, then the content aggregators need to come up with ways to monetize the content on behalf of the publishers and share the profits. Companies such as Nautanki and also Indiainteracts are looking into that. They are going about doing that by means of advertisement and also by placing relevant advertisements before or after the video. Perhaps this is where contextual video ads will find its way… in its best form.

I’ve always been curious about the way different industries work. There is a lot to learn from each other and more often than not you usually find that the learnings from one industry can provide to be of vital importance for the breakthrough of a process in another industry.

Take for example a restaurant. I would like to know what is the standard rule that a chef and the manager follow in terms of managing the inventory in the kitchen against the demand for dishes that they serve in the menu. It can be a little complicated dealing with the variances of different customers, and different dishes being favorites at different times of the year. And if I am a sample customer to go by, I don’t know what I am planning to eat till the moment the food is ordered.

I wonder how a chef manages all that uncertainty. Someday I’ll make a friend who runs a hotel – or perhaps i remember a few people whom I can already talk to about this – and understand the mystery logic behind this process.

One other industry that I have been interested has been the entertainment industry – especially the visual media stream. Thanks to a friend of mine, and I Fix, I did get the chance to peak inside a radio station in chennai and it has been quite interesting to get to know the lingo they use within, the atmosphere people work under and what the stress of that job is like. I did volunteer for a local radio station in canada and did get to learn quite a few things, especially about mixers and how they manage the program. But life from inside the booth and from the RJ’s box has been quite an interesting perspective.

All this said, the television industry has been something that has been evading me for sometime now. Well, I finally got a chance to put an end to that one two days ago.

A popular television channel was shooting a program to showcase the musical talent of office workers, and when i got an invitation to perhaps visit the set, I was quite curious and did accept the invite. I have to say that is quite an eye opener. If the saying “like a kid in the candy store” is not too cliched to use, I shall certainly use that one. Catching a glimpse of the people in the team that bring the show to life, and who holds the responsibilities for delivering what component – the accuracy in which lines have to be said, visual elements corrected and cameramen working in unison – and all this with sparks of creativity flying hither and thither, well if you thought meeting deadlines as a software engineer was tough you can rest easy knowing that show business is not a walk in the park. I am told that an entire episode of a show is sometimes scripted, shot, edited and shipped in a matter of days and people go on with or without sleep for days. Judging from the look of some of the people who were there, I have no reason to not believe that.

I was quite impressed with the quality of musical talent that is hidden away under the security controlled premises of the IT sector and revelling at the chance to witness some of these performances at close proximity.

So what does the tech side of me think? Well, The set was the most elaborate thing I’ve seen in sometime. The last time I saw a stage in such likely detail was when we were involved with an university event with a budget in the lower millions. That said, what was there in reality and what was coming out on the video monitor were gross misrepresentations. The set had layers and layers of prop and a very compelling atmosphere and the entire thing got lost in the world of 2D cameras.

Hmm.. How I wish 3D cameras would come to being a reality soon! We see the world in depth and can perceive it because we have two visual receptors – the two eyes. The camera tends to lose it cause it has only one eye – the lens. There have been plenty of attempts to work on camera with dual lenses which capture the essence and detail of the human vision. But its still a dream away from being reality.

All in due time.. all in due time.