While that may sound like a bad thing, optimistic developers could find a positive way of looking at it: There’s still a lot of room for growth.

Facebook told developers on Friday it was changing the way it measures the number of people who visit an application, and yesterday, the full impact of that announcement became blindingly clear.

“Everyone lost about a quarter of their users,” said Peter Relan, the CEO of Crowdstar, which now has 12.5 million monthly active users down from 17.8 million on Friday, according to AppData.com, which publishes data on a daily basis.

Facebook explained it traditionally measured and reported app usage based on the number of people who visit an app, similar to the way in which many Web analytics companies measure Internet traffic. But now it measures the number of people who authenticate the app, or give permission to the developer to see its information.

In essence, it’s shifting from measuring “visitors” to measuring “authenticated users,” which more accurately reflects the usage of an application.

“From our perspective, it’s the users who get through that make the money, so to some extent, the old figures weren’t revenue-generating numbers anyway,” Relan said.

More importantly, however, the shift will be psychological.

By simply changing the way it measures its figures, Facebook is able to make it appear that the social gaming market has expanded. That’s important because many developers thought the market was saturated and locked up by developers like Zynga, which has hundreds of millions of players.

In other words, the thinking was that if such a major percentage of Facebook’s roughly 800 million users are already playing games, what’s the point?

Now, all of the sudden, there’s a larger pool of non-gamers.

“I think Facebook has some challenges. Because mobile is taking off, they want to show that there’s still more growth available on Facebook; otherwise it’s too saturated,” Relan said.

While Facebook may attempt a positive spin on this news, the impact of the recalibration was really startling over the weekend.

Zynga, which has more active users than the next 15 social game developers combined, lost almost 20 percent of its user base. Today, under the new measurement standards, it has 195 million monthly active users, falling from the previous number of 262 million, according to AppData.

Electronic Arts, which is the second-largest social game developer, saw its user base shrink to 71 million from nearly 98 million.

In Facebook’s original explanation, it tried to downplay the impact: “While this change will result in a perceived decline in active users for some apps, the number of users actually engaging with an app or playing a game is unaffected by this change.”

Of course, there’s always a chance in the future that the key industry metrics will change again. “It’s a young industry,” Relan said.

Online influence measurement site Klout got $8.5 million in new funding, led by Kleiner Perkins from its socially focused sFund.

Kleiner’s wack-tastic venture partner Bing Gordon will join the board.

Greycroft Partners is also participating in this round, as well as some of its initial angel investors.

So far, the San Francisco-based start-up–which tries to measure influence across the social Web–has raised $10 million in total.

Here is Klout’s blog post and also its official press release:

Taking Klout to the Next Level

January 10th, 2011 by Joe Fernandez

Every day here at Klout HQ we are humbled by the passion people have for their Klout Scores, the amazing ways our API is being utilized and the innovative brands that leverage Klout to connect with influencers. We can’t thank you enough for your support. We are obsessed with helping the world understand the power of influence and I am proud to announce that we have added some key partners that are as passionate about this mission as we are. We have closed an $8.5m round of funding with Kleiner Perkins leading as part of the sFund and with participation from Greycroft Partners.

Measuring influence across the social web is a monumental task. Kleiner Perkins is the firm you turn to when your goal is to change the world. As part of the sFund, we look forward to working closely with many of the companies that define the social web. The team here at Klout is thrilled to have Bing Gordon from Kleiner Perkins joining our board of directors.

Greycroft Partners is also a critical new partner for us. Greycroft offers unique insight and connections with the media and advertising world. As we continue to experiment with connecting brands and influencers this will be a big help. We are also proud to have many of our angel investors participating including ff Asset Management, Tom McInerney, Paige Craig, Bobby Yazdani and Howard Lindzon.

This new funding will be used to continue to expand our engineering team (if you want to build something awesome, come join us!). Providing accurate, understandable and actionable data about influence is the kind of challenge we love, but we have a lot of work to do here still. With this money we will be adding even more services beyond Twitter, Facebook and LinkedIn to the Klout algorithm. We are also investing heavily in the Klout consumer experience to help the people who influence us the most, our users, better understand and leverage their social capital.

Personally, I look forward to devoting more time to our community. The Klout Score is quickly becoming the standard measurement for online influence. We love the passionate debate that influence invokes. To us, influence is the ability to drive actions. The way influence is measured and applied is going to continue to evolve at an ever-increasing pace. Fundamentally, we believe in the power of the individual and I think it’s critical for us to continue to offer transparency and open communication with the community as Klout evolves.

Thank you again for your support! There is a lot of hard work still to come but we are incredibly excited about the challenges and opportunities ahead.

Klout Raises $8.5 Million to Enable Everyone to Understand and Leverage their Influence

SAN FRANCISCO, CA, January 10, 2011–Klout, the leader in online influence measurement, announced today that it has raised $8.5 million in a funding round led by the Kleiner Perkins Caufield & Byer (KPCB) sFund™ and participation from Greycroft Partners. Prominent angel investors, including ff Asset Management, Paige Craig, Howard Lindzon, Thomas McInerney, Bobby Yazdani, and others, also participated in the round, which brings Klout’s funding to more than $10 million to date.

“It’s been amazing seeing the passion the social media community has for their Klout Scores,” says Joe Fernandez, CEO and co-founder of Klout. “We have a lot of work ahead of us, though. We intend to invest heavily in increasing the performance of our system to deliver the accuracy, clarity and actionability commensurate with being the standard for influence. To do so, we will need to greatly expand the number of services that are analyzed in calculating the Klout Score and provide a much richer consumer experience.

KPCB partner William “Bing” Gordon, a preeminent visionary on the future of the social web, will join Joe Fernandez, John Frankel and Allen Morgan as a member of Klout’s board of directors.

“People are hungry to get even more meaning from their daily social media use, and Klout is creating an important and new standard measure of relevance.” Says Gordon. “I hope everyone who reads this shares this message so my Klout score goes up!”

“In a very short period, Klout has established itself as a generic noun in the lexicon of the web,” says Alan Patricof, managing director and founder of Greycroft. “We believe Klout will continue to grow and be the standard measurement of influence.”

Given the meeting’s length, it’s hard to imagine the buyout talk extended much beyond a casual mention of the idea, though the two companies have held more in-depth discussions on the matter in the past. It’s far more plausible this was largely an “enemy of my enemy is my friend” chat, with Apple (AAPL) in the villain’s role, with some peripheral jawing about getting Flash running on Windows Phone 7.

But who knows, right? By purchasing Adobe (ADBE), Microsoft would gain a lot of IP and recent Adobe acquisition Omniture, whose Web traffic measurement software is that industry’s standard. And with nearly $37 billion in cash and short-term equivalents, Microsoft (MSFT) is certainly capable of writing the $15.5 billion check it would likely take to acquire the company.

The Web’s dominant traffic counter is in the midst of overhauling its traffic-counting system in response to years of complaints from publishers who insist that their traffic has been undercounted.

Turns out, the publishers were often right.

ComScore’s old data, for instance, say the Huffington Post attracted 9.95 million unique visitors in December. But its new numbers peg HuffPo’s December traffic at 20 million uniques.

The difference is that comScore’s (SCOR) old system tracked small panels of users and extrapolated their traffic patterns across the Web. But its new “hybrid” system uses panel data along with records generated by actual visits to the site, counted via tracking cookies. Publishers that cooperate with comScore (SCOR) agree to let the company “tag” every Web page on their sites.

“This is a much much better, much more methodologically rigorous way of doing this,” says Linda Abraham, comScore’s chief marketing officer.

ComScore has been rolling out the new system for months and says it can now use it to report on 25 percent of the 50 biggest sites on the Web. Another 50 percent of the top sites have agreed to work with the system, Abraham says.

ComScore lets publishers who are already clients participate in the program for free. But it will charge everyone else $10,000 a year, which the company says helps cover the cost of new servers and other equipment it needs to process the new deluge of data.

UPDATE: Some more detail on comScore’s fees, which generated a Web flare-up after this piece ran. Abraham notes that comScore’s set-up fee is $5,000, which she says covers implementation costs and gives publishers access to its data for six months; comScore charges publishers who want to keep receiving reports an additional $5,000 for each subsequent six-month period. However, Abraham notes, “If you choose not to purchase report access, you are free to do that, and we’ll continue to report you as hybrid, free of charge, as long as you continue to beacon correctly.” For more from Abraham, see her response to Mahalo CEO Jason Calacanis’s criticism; here’s the company’s blog post on the subject.

The new system doesn’t necessarily generate a traffic boost. AOL’s (AOL) Living channel saw its numbers decline by two percent in the new system, for instance, and its radio site saw traffic drop by 20 percent. AOL’s overall traffic, though, is up nine percent by comScore’s count.

Hybrid measurement is particularly kind to small Web sites and those that generate a lot of traffic from users who visit while at work. Both categories have always been difficult for comScore to measure using panels.

TheStreet.com (TSCM), for instance, has watched its traffic shoot up 86 percent under the new system, to 3.3 million uniques. That’s still much less than the site itself reports–in its last quarterly filing, the financial network reported an audience of 8.1 million uniques.

The fact that comScore is tracking some Web sites using the new system and the rest of them with the old one will make things a bit sticky for some time. The company has stopped releasing its monthly Top 50 list until May, when it says it will have moved almost all participating sites into the hybrid system.

But some sites won’t end up working with comScore at all, which means that comScore will measure them with its old panel methodology. At some point, the company will be presenting apples-to-oranges numbers when it compares different sites.

Does any of this really matter? Yes and no.

Ad buyers do pay attention to comScore rankings when figuring out where to place their money, even as Web publishers have presented their own, higher numbers from their own server logs. For some sites, the new data will make their pitches more compelling.

On the other hand, this does nothing to solve the real problem facing most publishers: They can’t sell ads against all of their inventory, no matter who’s counting it. And a measurement system won’t ever be able to help with that one.

BoomTown went to visit the HQ of Adobe in San Francisco several weeks ago for a chit-chat with its CTO, Kevin Lynch.

We had a lovely discussion about the future of its Flash video technology, as well as of its more recent AIR offering.

Lynch also discussed smart phones and other such devices, although he somehow neglected to mention the then-pending purchase of Omniture (OMTR) by Adobe (ADBE).

That would be the $1.8 billion the company said last week it would fork over for the Web measurement business.

Reaction to the deal has ranged from mixed to WTF? And some consider it an attempt to–as one smart exec put it to me–“buy revenue,” even as Adobe’s other businesses face major challenges ahead.

While the iconic company’s Photoshop and Acrobat software offerings dominate the Web publishing business, Adobe must still deal with the increasing move of all software into the cloud and onto non-PC devices.

And–with Microsoft (MSFT) continuing to aggressively push its own Silverlight online video technology and other companies like Google (GOOG) likely to have more to say in the arena–even the Flash business, which is now installed on more than 90 percent of Web-enabled PCs, will be more challenging than ever.

Lots to think about, so here is Lynch in a video interview:

]]> http://allthingsd.com/20090921/adobes-cto-kevin-lynch-talks-but-not-omniture/feed/ 0 http://allthingsd.com/20090915/measure-this-adobe-buys-web-traffic-counter-omniture-for-1-8-billion/ http://allthingsd.com/20090915/measure-this-adobe-buys-web-traffic-counter-omniture-for-1-8-billion/#comments Tue, 15 Sep 2009 20:42:29 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=11000 What do you do if you’ve got a grip on the Web/design software market? Expand into the Web measurement business, apparently. Adobe, whose Photoshop and Acrobat software offerings dominate the Web publishing business, will pay $1.8 billion to acquire Omniture, whose Web traffic measurement software is that industry’s standard.

Adobe (ADBE) is offering $21.50 in cash for each Omniture (OMTR) share. That’s a 25 percent premium over today’s closing price of $17.32–which includes a large run-up in the last few hours of the day, before trading was halted around 3:45 pm EDT. Good bet the folks at the Securities and Exchange Commission will take a look at that leap.

Release

]]> http://allthingsd.com/20090915/measure-this-adobe-buys-web-traffic-counter-omniture-for-1-8-billion/feed/ 0 http://allthingsd.com/20081203/comscore-cyber-monday-sales-up-15/ http://allthingsd.com/20081203/comscore-cyber-monday-sales-up-15/#comments Wed, 03 Dec 2008 15:38:30 +0000 Peter Kafka http://mediamemo.allthingsd.com/?p=1615 As promised, here are the comScore (SCOR) Cyber Monday numbers: The Web measurement firm says sales increased 15 percent over last year’s totals (click on table to enlarge).

Taken together with numbers from Black Friday and last weekend, these are encouraging, but not conclusive, data that consumer spending for the holidays may not be quite as bad as predicted. And while that won’t solve the economy’s deep problems, it would constitute good news, which is in short supply.

This should also hearten potential investors in Amazon (AMZN), which increasingly looks like it will be one of the only clear winners this holiday season.

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