OpenX is Moving to Hollywood

OpenX, the company who are applying the RedHat model to an opensource ad server have announced some big company changes today. Including:

1. A new CEO in Tim Cadogan. Cadogan was previously at Yahoo!, where he set the global product strategy for all products in the Yahoo Ad Network and prior to Yahoo! He was also at GoTo/Overture
2. James Bilefield, will be leaving but will continue to be involved as a strategic adviser
3. They are re-locating to Los Angeles

In his blog post, Cadogan writes:

<start shameless recruiting plug :-> In particular, if you are a great, highly motivated technologist interested in working at the intersection of advertising technology, open-source and new advertising business models, we’d love to hear from you.

Does this also mean that Scott Switzer – Co-founder and the CTO will also be leaving soon?

See below for Scott’s comment that he’s at OpenX to stay.

Regardless, AdViking thinks these are some interesting moves and should really strengthen the OpenX proposition further. In particular, with hiring Tim Cadogan, it appears they have snagged an advertising top gun with a very important and strong advertising product legacy - in particular in Search advertising. Maybe an indication of some of the future product direction?

Post-script: With Adify being bought for $300 million, it looks like OpenX could be in the right place, right time to make the most of having made the move to the US.  They key will be to deliver quickly on some of the features that will enable Publishers to quickly maximise their revenue (e.g.:  self-service advertiser UI)

UK Online Ad Spend Predicted to Out Pace TV in 2009

The IAB released their 2007 UK online ad spend study yesterday – the full PR is here. Two very interesting points from study included how the UK was ahead of online spending targets (gowing 38% to capture 15.3% market share) and is now predicted to pass TV in 2009. This is not a surprise to AdViking but still very significant.

To grow 38% from £2 billion to £2.8 billion is a very powerful performance, and with 16% share of media spend, the UK is head and shoulders above all other major world markets. It’s clear marketing directors now recognise the value of online to drive their business, and more and more are using rich media and video to build their brands, just as they do on TV.  - Guy Phillipson, Chief Executive, IAB

AOL Loses $76 million From Search Results Tweaks

Now that we have reached the point that Search is the Portal, we can all be forgiven for thinking that the user experience is no longer critical.

AdViking just read the excellent Dead Man Walking article on FastCompany  on the continuing demise of AOL that proves this is far from the truth and in fact that User Experience is more important than ever.

Or better, let’s rephrase that to knowing what experience user’s want when they use your Search is more important than ever.

In response to a fall in Search traffic at AOL (38.9 million visitors in November 06 vs. 35.2 million in May 07). Ron Grant*, the new COO for AOL, took the executive decision that the fall was due to the fact that AOL returned a rich results set (e.g.: multi-media, pictures), that was reported to have a higher than Google effective return on advertising. And so deciding to buck the movement towards a richer search experience (ASK’s 3D search, Google’s Universal Search), Grant ordered the results set to be more look Google’s.

The results of this change could be considered catastrophic. Pali Research analyst Richard Greenfield said, “Management was blindsided by how disruptive the change to search was.” In a period of industry growth, AOL’s Search revenue fell from $232 million in Q1 to $156 million in Q2. To put it bluntly, one could say that the changes made to the AOL’s Search Experience could be blamed for the drop of $76 million in one quarter!

It appears that Users liked the Search Experience on AOL and the fact that is was different was the just the point. That is users were in a different mindset when they came to use AOL Search. Meaning, knowing who your users are and how they use your site is critical.

Finally, on the trend around richer Search experiences, enquiro research wrote an enlightening whitepaper, Search Engine Results: 2010. It’s based on interviews and research on the impact of user interaction with these richer results. The interviewees included: Jakob Nielsen, Marrisa Mayer, Greg Sterling and Danny Sullivan.

* Time-Warner company men, Steve Falco and Ron Grant, have been put in place as the CEO and COO of AOL. Employees and now the wider industry appear to have started to refer to Falco and Grant as Mr. Burns and Smithers.

Google is Selling DoubleClick’s Performics

On the back of the close of the DoubleClick acquisition, Google has started to cut numbers and have has made some interesting moves with Performics, the SEM part of DoubleClick. They have first separated it into two business units: affiliate marketing and search marketing. And second, have announced that the search marketing business is up for sale.

This is generally seen as a positive move, as it avoids a potential direct conflict of interest. In other words, customers would be paying Google to get higher rankings/results.

Tom Phillips, Google’s director of DoubleClick Integration, says this about it:

It’s clear to us that we do not want to be in the search engine marketing business. Maintaining objectivity in both search and advertising is paramount to Google’s mission and core to the trust we ask from our users. For this reason, we plan to sell the Performics search marketing business to a third party. We believe this will allow us to maintain objectivity and the search marketing business to continue to grow and innovate and serve its customers.

This is a very positive sentiment from Google and only those with a really cynical industry view would say that any purchase price of Performics would have to include some understanding about maintaining a special relationship to ensure Performics can continue to take advantage of all they have learned during their time at the Googleplex.