iPad image copyright Skylines

Napster was the first of its kind, providing music fans with easy and free access to albums and tracks and giving them a reason to avoid buying expensive CDs — the lifeblood of the music industry’s business. The ability to share files around the globe reduced the barriers to music discovery and allowed Napster users to find new artists and songs in ways never imagined. It was a truly disruptive service, and it scared the hell out of the music industry.

Instead of embracing the massive adoption of this new service, finding a solution to accommodate the changing landscape or harnessing Napster as a future platform, the music industry held onto its rigid CD-based business, prayed that file sharing would go away and eventually tore Napster down.

Today, you can draw several parallels between the music industry in the late ’90s and early 2000s and the TV industry today. Viewing habits are changing. Just like music in the early 2000s when young adults started turning away from physical media and opting for singles versus complete albums, viewers are “tuning in” very differently to movies and TV programming.

Today, if Netflix were part of a cable package, it would be one of the top viewed networks, according to a Facebook post from CEO Reed Hastings. Meanwhile, Nielsen recently reported that cable cutting is up by 150 percent since 2007, marking a significant shift in viewer behavior. Additionally, Aereo CEO Chet Kanojia is now assuming the role of Shawn Fanning by intimidating the cable companies with a disruptive service that lets viewers access broadcast programs at a much lower cost than cable packages.

But, instead of adapting to changing viewer behavior, the cable companies, Hollywood and broadcasters are holding onto old business models for dear life and calling the lawyers. Sound familiar?

Avoiding a Bad Sequel: Lessons for the TV Industry

Ignoring or fighting digital consumer behavior is a recipe for disaster — resulting in rejection faster than an unpalatable creation by a contestant on Hell’s Kitchen. It’s time for TV broadcasters, content creators and advertisers to innovate their businesses instead of maintaining existing models through threats and litigation.

First, they need to understand that their viewers are setting the rules and defining the life expectancy of their programming and services. They will decide your fate — not you. Consider the following:

• You Can’t Take Content Away: The outdated model based on controlling distribution is dying. If you force it underground — that is, “illegal streams and downloads” — you’ve lost the battle.
• Adapt or Die: The millennial generation is addicted to YouTube, on-demand and streaming services. They no longer tune in at a specific time and date, and are increasingly shying away from paying for premium cable bundles. With filmmakers and producers spending the time and resources to make great TV programing, like “Homeland,” “Girls” and “Mad Men,” delivery methods should be figured out to get these shows to viewers who won’t pay $150 per month in subscription fees.
• Open the Windows: The “distribution window” is used by Hollywood to define how long a VOD and streaming service can distribute movies and TV programming. The problem? If the window for season one of “Downton Abbey” is about to close from Netflix or your cable provider, and you haven’t watched any of the episodes, you better call in sick to work to get your fill of the Granthams and the Crawleys, or miss the entire season altogether.
• Stop Explaining Business Models: Movie and TV viewers don’t give a sh*t about business models. They just want to watch their favorite shows — whenever and wherever they choose. The music industry followed the same pattern in the early 2000s, explaining why the economics of music streaming and downloads would not support artists and the industry. Guess who won?
• Open Up to Developers: Don’t assume innovation will only come from within your organization. By tapping the developer community, you will be able to move faster and find new ways to use or distribute content, which could result in new monetization strategies. Some of the more forward-thinking media properties, including ESPN, are already doing this, allowing developers to hack ad strategies and sports data.
• Rethink Discovery: As video distribution evolves, there needs to be a corresponding evolution in how people discover new movies and TV programming. If viewers are paying hefty monthly subscriptions (which today support a lot of what they don’t watch), it is critical to provide paths to find what they really want to watch. The current TV guides embedded in our set-top boxes have to be completely rethought.
• Reinvent Measurement: We still depend on a small sample of viewers to rate the popularity of programs and we base all advertising decisions on this data. However, the technology to measure real time usage inside the TV exists today and has the potential to enable more precise measurement and better targeting of advertising.

The TV industry’s fate is as much in the hands of viewers as the next American Idol. Not only accepting, but also realizing that TV programs and movies are easily accessible via proliferating distribution channels such as Netflix and Aereo, the industry can turn the tables and find opportunities with additional platforms and options to reach viewers for their eyeballs and spending. Most importantly, cable, broadcasters and Hollywood have the opportunity to move forward and determine better and more efficient business models to thrive.

Forward-looking networks like HBO have slowly worked toward a compromise by offering specialized content that depends on the Pay-TV ecosystem. However, with cord-cutting slowly beginning to eat into cable subscriptions, the HBOs of the world need to take distribution models a step further and offer everything streaming with direct-to-consumer subscription models, or risk losing their next core audience. If TV viewers are willing to pay for subscription streaming services, then the industry needs to jump on that bandwagon.

Rewriting the Ending: To Be Continued

The nature of distributing media is evolving, and the music industry learned the hard way as it struggled to adapt to a new generation of music fans. More than 10 years after the music industry forced Napster to tear down its P2P platform, the same industry has embraced free, ad-supported services from Spotify, Rhapsody, Deezer and others. In fact, this year marked the first time that the music industry made a profit since 1999.

Instead of struggling against the Internet Age and the connected world, broadcasters, cable companies and Hollywood can capitalize on the audience’s need to enjoy what they have to offer — great TV programming. Content will always be king and the industry creates a tremendous amount of really compelling material. It just needs to keep the crime scenes to “Law & Order” and save the video star by taking a cue from music’s past.

As president of Gracenote, Stephen White has played a critical role in shaping the company into a digital entertainment leader. He spearheaded the development of Gracenote technologies for top entertainment platforms and brands, including Apple, Ford and Sony. Today, he oversees all company strategy and operations, and is responsible for growing Gracenote’s core business and vision.

Broadcast and cable networks, including NBC, Fox, ABC, Univision, Discovery and A+E, have signed up for the pilot program for “Nielsen Digital Program Ratings,” which will happen over the next few months before a broader commercial rollout later this year.

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Image copyright Norm Hall | Getty Images Sport

It’s a stark contrast from the glory days, where distribution was fixed and scarce, and all we had to do was put a great product out there. At the time, all content had found its own native distribution outlet — a channel on the dial, a spot on the newsstand, a movie theater, video store — that delivered it to the bulk of its audience. That distribution was beautifully limited — there’s only room for 12 channels on the old VHF dial, 16 movies at a multiplex and maybe several thousand titles at video rental stores.

But today, distribution and consumption are in constant flux. Look at TV. To be truly “Everywhere” these days, a TV show has to be on network, cable, YouTube, Netflix, Hulu, iTunes, Facebook and Amazon, have its own native app in Apple and Android stores — at a minimum — and a presence in Google’s mighty search index.

To succeed today, digital media companies need to get control of their distribution. The opportunity for savvy media companies is to abandon the outdated if-we-build-it-they-will-come mentality, and master the craft and science of programming.

Programming is the skill of matching content to audience. Programming is what built the global TV and film industry from $200 billion to $300 billion in the last decade. If you want to succeed in digital media going forward, programming is everything.

I spent time recently with a friend from CBS and told him about what my company Wetpaint does to program social as a channel: In short, we deterministically deliver the right content to each audience at the right time. That might mean, for example, a recap of yesterday’s news timed for the morning bus ride, a short-form video clip posted to coincide with a mid-morning coffee break, a gossipy tidbit just as lunch begins. “That may work in entertainment,” he said. “But it would never work in breaking news. In news, everything needs to go out immediately.”

So I did some research, and it turns out he’s wrong. When you look at what our editors consider breaking news within the entertainment category, the vast majority of stories — more than 75 percent — perform better when they’re packaged and presented at another time of day, and not when they first break.

While immediacy became the mandate in the ages of CNN and Google, smart programming is far superior in an age of multiple distribution outlets.

The expertise of digital programming is in its infancy, but some of the secrets for success have emerged. Here are a few:

• You don’t have one big audience.
  Digital media companies need to know who their audience is and what they like, and then customize their product and pitch accordingly. But convention on the Web has been to serve everyone the same thing — and the folly of that is a massive missed opportunity. Instead, understand your value to all your major audience segments. After all, each person you reach thinks of herself as an audience of one. Meet her where she’s at, and you’ll find your resonance — and performance — will be much greater.

  For decades, the National Football League operated on the basic assumption that football is for guys. That conventional wisdom was upended in 2010 when research by the NFL and Nielsen found that more than 40 percent of the league’s fans were women. (It’s upward of 44 percent now.) Of course, football fans (both male and female), segment along many lines — and NFL marketers will have to find ways to speak to, sell to and grow all those demographics. But acknowledging women was a huge and lucrative step to grow the league’s opportunity massively.

• Learn what will resonate. (Hint: In the battle for consumer hearts and minds, heart wins every time.)
  Once you know who your customers really are and can group them by their common interests, the world opens up. You have the freedom to design new content and experiences to delight them. It doesn’t have to be one-size-fits-all any longer; your brand doesn’t have to be watered down to its most basic and neutral. Many brands and publishers struggle for relevance — but once you articulate who your audiences are and understand what they’re interested in, the door is open to all kinds of new conversations. Research, feedback and analytics can all help you become expert in each of your audience segments. Then use those insights to grow your brand.

  Sticking with the NFL as an example, when the league learned about its popularity with women, it took that finding and ran with it, introducing a new website, ad campaign and product lines — all aimed at the now 80 million women who tune into NFL games each weekend. Female fans rewarded the new attention by dropping millions on NFL apparel, jewelry, nail polish, yoga mats, etc. The league went further and partnered with the American Cancer Society to raise awareness about breast cancer, which explains all the pink flourishes (gloves, socks, wristbands, etc.) on the field and the sidelines these days. This overdue — and heartfelt — outreach strengthened the bond between the NFL and its huge female fan base. The league’s bottom line smiled. In 2012, NFL fans spent $3.2 billion on consumer products.

• Timing is everything.
  Of course, the most basic element of the art of content programming, one that has been mastered by the TV networks, is knowing what performs when. Prime-time shows don’t work in the mornings, and re-runs would squander the huge opportunity of evening viewing. There’s a time for opinion and a slot for hard news, and reversing them tanks performance and tunes out audiences.

  But on the Web, well, somehow the only rule of thumb our industry seems to know is “the best time to post is now.” And that’s preposterous.

  In terms of social, the state of the art sounds better, at least at first: There are lots of generalizations out there about when to post content: Mornings are better than evenings, Facebook sharing spikes on weekends, tweeting peaks on Fridays. Well, that’s all great in theory, since it documents average behavior of average audiences. But the point isn’t to get it right for someone else’s average consumer. Whether we’re talking about work or play, we all develop our own individual routines and habits. Discovering the personal quirks of your particular audience is a goldmine for programmers.

  How powerful is it? Several years ago, a U.K. content agency called Collective Content was helping a small management firm develop its programming strategy. Traffic to the client’s website waned on weekends. Nothing surprising there. But Collective Content began to notice an uptick in Sunday visits. “Sunday evenings had become the new Monday morning,” wrote Collective Content founder Tony Hallett. “Execs and other managers were getting a jump on the working week. This was a great time to feed their need for information.”

  At Wetpaint, we try to time content delivery to the distinct habits of our audiences, which vary from show to show. The very young (13-24) “Pretty Little Liars” audience likes a fast-paced, high volume content diet, so we serve them fresh stuff all day long. Older (55 percent are over 24) “Grey’s Anatomy” fans catch up on new content in the evening, just before they get into TV-viewing mode. So we freshen our “Grey’s Anatomy” pages late in the day. If you program according to someone else’s guidelines, all your best shots will miss your target. Instead, know your audience and you will hit the mark.

• Like it or not, people judge books by their covers. Design your packaging to resonate.
  In pre-digital days, content packaging discussions went like this: How long is the story? Do we need photos or illustrations? Today, fuhgeddaboutit. Digital editors have lots more arrows in the quiver. They can trot out old packaging chestnuts like long-form profiles or Q&As, or they can present content in slideshows, video, audio, polls, quizzes, clickable infographics, Spotify playlists, etc. The packaging options just keep growing — and so does the menu of social media megaphones you can use to trumpet the final product.

  Working all those levers in a way that engages your audience and exploits the strengths of each packaging and delivery option is an art and a science. BuzzFeed is one of its master practitioners. In its self-proclaimed rules for “How to Go Viral” (an infographic, of course), Buzzfeed recommends making lists (“9 out of ten Internet lists go viral”), using quizzes to appeal to user vanity (“People online love talking about themselves”) and staying relevant. We won’t quibble with the BuzzFeed rulebook. But in our own experience, packaging — like timing and just about everything else — is audience-specific. Fans of “Vampire Diaries” like to vote, for example; so we give them polls. And it works — to the tune of thousands of Facebook ballots click-cast for star Nina Dobrev in our sexiest legs poll.

• Test, test, test, for insights you can use.
  If you follow my Digital Quarters blog and Media Success newsletter you know I’m a nut for data. I firmly believe that the only way you can truly know your audience in all its wondrous eccentricity is to embrace testing with a gusto that borders on obsession. (Yes, I am seeing somebody about this.) Every shred of content you produce, from the glossy video to the tiniest tweet, is an opportunity to learn something about the consumers who visit your site. Don’t waste it.

  As you generate (via surveys, focus groups or, our favorite, A/B testing) and then sift through the mounds of data, trends will unfailingly emerge. These insights into user preferences help drive programming decisions at Wetpaint.

  Testing tells us that our “Bachelor” and “Bachelorette” fans revel in relationship gossip. Stories about dating, cheating, break-ups, pregnancy rumors, etc., perform four times better than episode-related news like recaps or sneak peeks. But within that relationship news subcategory, the two audiences diverge: Bachelorette watchers are scandalmongers. Bachelor fans are sentimentalists. We tailor our content accordingly. Testing has also made us smarter about social media. Facebook posts with photos work best when we’re promoting content for scripted (“Grey’s Anatomy”) or reality (“Bachelor”) shows. For breaking news, text-only posts do just fine. If the news is big, words are enough to catch the eye.

• The News Feed is the new EPG, and you must be present to win.
  The greatest opportunity of all in digital media is the chance to be relevant to your audience — not once a day, not on an appointment basis once a week, but minute by minute. To do that means being where your users are at all hours of the day — with exactly the right content at the ready. For consumers, it would be like the “Electronic Program Guide” that we’ve had on TV for the last 20 years — only it would be completely personalized and constantly refreshed. Quel fantasme, n’est-ce pas?

  Lo, there’s an app for that — and it’s the No.1 app on every smartphone. Yes, Facebook is the new Electronic Program Guide. Consumers check Facebook many times a day — usually just briefly, sometimes longer — to see “what’s on” in their lives. In fact, 23 percent of all time spent on smartphones is spent on Facebook mobile apps.

  For media companies, the great opportunity here is to cement your relationship with your audience by getting in their network — and then turning up the content they’ll enjoy to whatever frequency interests them. Do it right — with great audience targeting, insight, timing, packaging and testing — and you earn a position at the top of the News Feed hour after hour, day after day.

  Who understands this well in media? Of late, Yahoo’s Marissa Mayer has been talking about building a “daily habit” with consumers. Why not twice a day, or more? That is the power of presence in the feed. And it comes from meeting each member of your audience where she is.

Smart programming is like a good relationship. It requires paying attention, being responsive, trying new things. It’s hard work, but the rewards are enduring — a loyal, ongoing relationship with a growing audience. And that surely makes it worth the effort.

This is a guest post by Ben Elowitz (@elowitz). Elowitz is the co-founder and CEO of next-generation media company Wetpaint, and the author of the Digital Quarters blog about the future of digital media. Prior to Wetpaint, Elowitz co-founded Blue Nile.

And here’s an example of one of those, via Mexican soft drink Jarritos:

People have been trying to make entertaining ads since the beginning of time. But if you want to add a bit more nuance to the native ads definition, think about them as ads you choose to see.

For example, a new study from Nielsen says that if you clicked on the Jarritos video because you thought it looked interesting, there’s a good chance you’d think positively about the brand that brought you the clip.

But if the ad simply showed up as a 15- or 30-second “pre-roll” ad before a video you were waiting to watch — that is, you didn’t have any choice but to see it — the ad was only marginally more effective than no ad at all.

Here’s what that data looks like in chart form. The figures refer to the percentage of people who had positive feelings about Jarritos:

All of the above is part of the pitch for Sharethrough, a “native ad network” that worked with Nielsen on the research, and which is trying to convince advertisers to let it distribute their ads as “content” on sites across the Web.

But Sharethrough isn’t the only company pushing this idea. YouTube’s take on this is its “TrueView” format, which generally starts out as a pre-roll ad but gives its billion viewers the ability to skip ahead after a few seconds.

Google’s video site only charges advertisers when viewers choose to watch, and it is so heavily invested in the idea that it’s getting pushback from some video creators, who argue that TrueView is cutting down on the ad dollars they see.

As trendy as native ads are, we’re not moving away from intrusive, you-must-watch ads anytime soon. There’s simply way too much apparatus constructed to support that ideology, and it turns out that making stuff people want to see is pretty darn hard. But you can see why advertisers, publishers and investors are all excited about an alternative.

Aspen Photo / Shutterstock.com

Heads up, cord-cutters: If you want to watch March Madness next year, you’re going to have to pay up.

The last two rounds of next year’s college basketball tournament, including the championship game, are likely to be broadcast on one of Time Warner’s Turner network channels — TBS or TNT — instead of CBS, according to Sports Business Daily and the New York Times.

CBS and Turner share coverage of the tournament, and the switch for the final games was already scheduled for 2016. No one has explained why the two companies are moving the date up by two years, but it fits a pattern we’ve seen for several years: Big-time sports events migrating from free TV to pay TV.

In 2006, Monday Night Football moved from ABC to Disney’s ESPN. If you wanted to watch much of last summer’s Olympics, you needed a pay TV subscription that gave you access to NBC Universal’s cable channels. And as SBJ’s John Ourand notes, the BCS college championships, the NBA conference finals and some baseball playoff games have all moved over to cable, as well.

The free-to-pay move serves the interests of the TV Industrial Complex in several ways: The cable networks, flush with cash from subscriber fees, can afford to pay big bucks for the rights to what is must-see TV for many people. And because it’s must-see TV for many people, it helps raise the overall value of the cable networks (Rupert Murdoch used the same strategy to turn Fox into a legitimate broadcast operation two decades ago).

And moving big-time sports to pay TV helps pay TV, period. Nielsen figures there are five million cord-cutters, or cord-nevers, and that number would presumably be much bigger if you could get sports online without paying for TV.

Which is why I’ve been waiting for Google, or Apple, or Intel, or some other TV outsider to pony up for the rights to a slate of NFL games, or some other sports franchise that millions of people have to watch, no matter where they are. Hasn’t happened yet.

(Note that if Aereo, which distributes broadcast TV over the Web without paying programmers a penny, wins its court case, then expect just about every big broadcast show — not just sports, but everything — to move from broadcast to cable networks owned by the broadcasters. Big if, though.)

Meantime, if you’re serious about college hoops and you’re serious about not paying for TV, you might still have a legal option next year.

Last year, CBS and Turner offered a $4 package that let you watch the games live on Android and iOS devices, and that option has gone away this year. This time around, you can only stream the Turner games if you’re an “authenticated” pay TV subscriber, though you can still stream the CBS games to your PC without registration.

But Turner/CBS are offering app users a free four-hour “preview” this time around. So if you’re willing to do a little planning — and if the option is still available — you could save up your preview time for the championship game, and at least watch that one for free.

That sounds like a lot of work, right? That’s what the pay TV guys are hoping you think …

Aspen Photo / Shutterstock.com

Something similar happened when the hardcover edition of “Networking is Dead,” was published in mid-December. A week after selling enough copies to make it onto the Journal’s business best-seller list, more hardcover copies of the book were returned than sold, says book-sales tracker Nielsen BookScan.

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But one thing is crystal clear: This isn’t the Magic Kingdom, folks, it’s business. We need to dispense with the magic because marketers and publishers are dealing in real money, not fairy dust, and both deserve a comprehensive understanding of online video ad metrics to help them make sound investments.

The nearly limitless variety of online content, devices and viewing habits has scrambled the measurement picture and created a lot of static around business value. Media and ratings giants have been circling around the online video ad measurement standard, each deciding where to stake a claim.

Nielsen’s recent foray into radio and social media measurement vis a vis its acquisition of Arbitron and partnership with Twitter upped the ante considerably. AOL, comScore, Google, and many others have thrown their hat in the ring by announcing their adoption of frequency and audience metrics like Gross Rating Points (GRPs) and Target Rating Points (TRPs) — but not exactly.

Industry organizations — including the Association of National Advertisers, the Interactive Advertising Bureau and the American Association of Advertising Agencies — are weighing in on the discussion, with a focus on driving definitions that can support standardization. There’s little consensus, and it seems the variations on measurement standards are as diverse as the devices, content and viewers being measured.

The irony over the entire measurement brouhaha is that practically all of the online video ad measurement methods vying for “standards-hood” are still mostly magic. Don’t get me wrong: GRPs, variations thereof and other common online video ad measurement techniques all have a place in the mix.

But they aren’t enough.

The online paradigm offers us something we didn’t have before. In a word: Accuracy. Online targeting and personalization doesn’t have to be based on a sample of data, but instead “all” of the data accessible. It’s the difference in saying males between the ages of 30-45 generally like to watch ESPN and “Bismarck Lepe” watches Bloomberg TV over breakfast on his iPad in the morning, and then watches the Food Network on Cable TV from 11-12 in the evening. The latter paints an accurate picture of a person who is more likely to consider and purchase well-targeted products and services.

To achieve truly effective, useful measurement that delivers ROI for marketers and publishers alike, it’s essential we bust open the magic myth and confront the realities of the new online video ecosystem. Viewers, much like the content they enjoy and devices they use, are incredibly varied; their habits, likes and dislikes are similarly nuanced.

Those nuances, and a rich understanding of them, are the metrics that can drive advertising as well as content personalization. With the right metrics, advertisers could, for example, opt to connect viewers with only the ads uniquely relevant to them. Publishers benefit because more targeted, effective reach spawns more ad purchases.

Personalized content and advertising isn’t fantasy. It can be accomplished with measures that are dramatically more comprehensive and meaningful, that provide real-time granular metrics across dozens and dozens of variables and that combine those variables to create an accurate picture of each individual viewer in the online video world.

Real, comprehensive online video ad measurement should account for distinctions in not only geography and demography but also in psychographic variables like age, gender and especially interests. (Sure, Ariel and Cinderella are both 20-something princesses from the Magic Kingdom, but that doesn’t mean they want to watch the same online content!)

Information regarding devices — including type, operating system and domain — and viewing habits such as trending content, conversion rates, video completion rates and social sharing events, must be factored in as well. Most importantly, marketers need the tools to mix and match metrics and analyze and report on all variables in real time, so decisions can be made on the fly — because that’s how online audiences roll.

Online video ad measurement standards are important; we need consistency so the industry is comparing apples to apples when selling and buying advertising. But the proposed standards, with their samples, GRPs and a little bit of magic won’t suffice in this rapidly growing, highly diverse, dynamic market.

Measurements that provide a more granular understanding of viewer preferences, behavior, device, location and other metrics can dramatically optimize online video advertising efficacy and reach. Without more comprehensive metrics in online video ad measurement, marketers will continue to be like magicians throwing knives blindfolded — they come close to their target but rarely hit it dead on.

Bismarck Lepe is a co-founder and the President of Products for Ooyala, a provider of online video management, publishing, analytics and monetization technology. As Ooyala’s founding CEO, Bismarck raised the company’s early funding and signed many of the company’s first media partnerships. He was previously a Senior Product Manager for Google, where he managed the early growth of AdSense display and video advertising and launched more than 25 different Google AdSense products, including Click-to-Play video ads. Bismarck has a B.A. in Economics from Stanford University.

Now Bazaarvoice has someone to run their new business: Ad tech veteran Ari Paparo.

Paparo’s most recent job was at AppNexus, where he spent a year and change; before that, he was at Nielsen for a spell. But he’s best known for his work at DoubleClick, both before and after the display ad giant sold to Google.

Bazaarvoice is one of many companies trying to leverage the copious amounts of data that e-commerce sites generate into new opportunities, like advertising; clients include Walmart and Best Buy.

E-commerce heavyweight Amazon, which has been circling around ads for a couple years without making a major push, is still thought to have a $1 billion ad business of its own.

But that deal never closed, and tonight GetGlue says that it never will.

A blog post by GetGlue founder Alex Iskold doesn’t say much. “Today, we’ve decided that GetGlue will not be merging with Viggle,” he writes, adding that “all of us at GetGlue are excited about growing our social network and the leadership position on the second screen.”

If you have to take a guess at the backstory, it likely has to do with Viggle being unable to get the financing it needed to get the deal done. As TechCrunch noted last week, Viggle had told investors, via an SEC filing, that it was working on an extension to its original deal, announced back in November.

I’ll take another guess and speculate that if there was any way to make this work, GetGlue would have stuck around.

I’ve been told that Iskold had pushed hard for the deal, even though some of his investors — including Rho Ventures, which led a $12 million round a year ago — had wanted him to stay independent in the first place. I’ve asked him and Viggle reps for additional comment.

This week in Las Vegas, the new management team running Yahoo — including CEO Marissa Mayer — is at International CES to schmooze with big advertisers and convince them that Yahoo is the place to put large chunks of their marketing budgets.

One of the longtime selling points of the company is the sheer size of its audience, especially for the key money-making parts of the site — the homepage, Yahoo Mail and search.

But private stats from comScore show that those three areas have continued their longtime decline over the last year, in some cases dropping significantly. In November and December, for example, compared to the same two months a year ago, U.S. search was down 28 percent and 24 percent respectively, while mail was down 16 percent and 12 percent.

This matters a great deal, since the troika of homepage, mail and search have been the critical driver of the Yahoo value ecosystem for advertisers.

The impact of those drops is felt all over Yahoo, whose music, movie, games and travel site have also seen massive drop-offs in traffic year over year in those same months.

Stopping the decline is critical for Yahoo, since Mayer herself has underscored the need for size in her pushing for new businesses at Yahoo that are 100 million users in size and/or have revenue prospects of at least $100 million.

While this is a lofty vision, the reality of traffic falloffs on key properties is a vexing issue, especially since they remain its main source of revenue and also an important element in launching future products Mayer is promising will turbocharge the company.

It’s not that Yahoo is not huge, especially compared to most sites on the Web.

As one of the top Internet brands, according to a recent Nielsen report, the average number of total monthly unique visitors for the longtime Silicon Valley Internet company in 2012 was 141.6 million, No. 3 behind Google and Facebook in the U.S. market. Similar rankings were reported by comScore, which placed Yahoo at the No. 2 spot after Google, with 171.4 million monthly visitors in November.

But, for many years, traffic to those important consumer destinations of Yahoo has been on a clear and unstopping decline, statistics (usually from comScore) that the company nonetheless always dutifully puts in its earnings slides — see below — for investors to get some idea of the major and vexing issues facing the company.

That was suddenly ended in the last quarter with the engagement slide removed from Yahoo’s public deck entirely. Not all companies include such stats, so when I inquired as to why the company had made the change, Yahoo PR never returned my phone call.

But it’s not hard to guess the reason for the shift — the numbers were not good and they called more attention to Yahoo’s glaring challenge, which is getting users reengaged with its products by creating what Mayer has dubbed several times “delightful” experiences.

According to numerous sources, that has also been the case within the company too, with the new regime restricting an internal transparency initiative pushed by former Chief Product Officer Blake Irving that shared product performance numbers with the top 100 leaders at Yahoo.

And while it’s an interesting strategic choice, several sources inside the company this week urged me to get ahold of increasingly worrisome numbers from comScore — available to its private clients — comparing November 2011 to November 2012 and also December 2011 to December 2012 at home and work in the U.S.

So I did, getting the same stats from numerous sources — numbers that a spokesman for comScore confirmed were correct.

And, as promised, they are worrisome indeed.

In November 2012, compared to November 2011, the monthly unique visitors to the homepage declined 17 percent to 91.8 million from 110.9 million; Yahoo Mail dropped 16 percent (from 92 million to 77.7 million); and Yahoo search dropped 28 percent (from 93.3 million to 66.9 million).

Also off significantly for all three areas, often by one-third, were a plethora of other stats: Percentage of reach, total minutes, total page views, total visits and more.

One of the only bright spots for Yahoo was the relatively small Flickr sites, which were up 37 percent — 26.7 million versus 19.4 million — in unique monthly visitors year over year. The photo-sharing site — which has been getting a much-needed refresh — was also up in all other stats.

But Flickr — which Mayer (pictured here) has laudably touted and supported after years of inexplicable neglect — is not a money-maker for Yahoo, even if its return does burnish the company’s tech and innovation cred.

In December 2011 to December 2012, the homepage was more stable, gaining four percent in monthly uniques from 109.4 million to 114.2 million, but with other key stats both rising and falling. Total visits were up 14 percent, for example, while average minutes per visit was down 13.6 percent.

But the trouble for mail or search continued, off 12 percent (89.9 million to 78.7 million) and 24 percent (88.7 million to 67.4 million) respectively in monthly uniques, with similarly major declines in all other stats.

Mail recently got a refresh too under Mayer, despite some recent security glitches, so new stats will show if that will help stem the declines. Search is another story all together, with Yahoo in what can only be described as a dysfunctional partnership with Microsoft that numerous sources tell me Mayer is seeking to end.

The homepage, too, is undergoing a redo, with a design that has a decidedly more mobile and social feel, and pushing an ethos of Yahoo becoming a hub for content discovery. It is hoped the new look will boost traffic relatively quickly from its current downward trajectory.

To be fair, there can be lots and lots of reasons for these declines, although most of Yahoo’s competitors are, at worse, seeing a flattening of growth and not outright declines.

And sometimes Internet sites complain that services like comScore undercount, although Yahoo had previously used the firm in its public documents. More to the point, as multiple sources within the company note, the stats are directionally correct in that they closely track with internal Yahoo numbers.

Which is to say, traffic is going down rather than growing. That is clearly why Mayer has loudly stressed mobile since arriving at Yahoo, an area not included in these numbers that many sources said has strong growth to about 70 million monthly unique visitors via its apps and mobile-enabled Web offerings.

But unlike the homepage, mail and search — which push and pull traffic all over Yahoo and are responsible for most of its current monetization — mobile also makes very little money now. And Yahoo — unlike Facebook, which recently did — does not break out mobile results.

So, it will be interesting to see if the company does so when it reports fourth-quarter earnings on January 28 and also if it says anything about continued traffic declines of its traditional Web business in the period and the impact on revenue.

Still, there are lots of ways to counter declining or flat revenues, even with declining traffic — via cost cuts, efficiencies, charging more and selling assets (as Yahoo did in the last quarter). And Yahoo has ably managed to keep its operating margins growing over the years, despite both the declines in traffic and moribund growth in its revenue.

But the real and only fix is the drastic fix to existing tentpoles Yahoo has and the creation or acquisition of products that excite consumers and, therefore, advertisers.

It’s not an easy thing, of course, as well-known venture capitalist Ben Horowitz recently wrote in his blog about the need to focus on products over building and improving culture — one of Mayer’s other big initiatives at Yahoo.

Wrote Horowitz in what I consider one of the clearest articulations of what it takes to win for startups, as well as big companies like Yahoo:

“The primary thing that any technology startup must do is build a product that’s at least 10 times better at doing something than the current prevailing way of doing that thing. Two or three times better will not be good enough to get people to switch to the new thing fast enough or in large enough volume to matter. The second thing that any technology startup must do is to take the market. If it’s possible to do something 10X better, it’s also possible that you won’t be the only company to figure that out. Therefore, you must take the market before somebody else does.”

If you want to take a gander, here are some more of those old Yahoo quarterly engagement slides, which were recently eliminated from its presentations:

(Note: I reached out to Yahoo’s outside PR firm — since they do respond to queries — and also some company execs to get a comment on this story, but so far there has been none.)

The deal will give Arbitron shareholders a 26 percent bump on yesterday’s closing price, and both boards have signed off on the transaction.

Here’s Nielsen’s pitch to shareholders, in slide form; the deal will need regulatory sign-off.

Measuring radio and TV is a slow-growth business, but it’s still a big business. The two companies do a combined $6 billion a year in revenue.

And both companies have been impervious to attempts to break their locks on their respective businesses — Nielsen, for example, has tried and failed to make headway in the radio market itself.

What about Web measurement? Isn’t that a big deal, too? Sure, and it will get bigger. And Nielsen already does some of that, too.

But comScore, the dominant digital-measurement company, did just $232 million last year, and shareholders value it at less than $500 million. Old media habits die hard.

(Image courtesy of Shutterstock/icearnaudov)

It’s an exclusive multiyear agreement, dubbed with the fancy “Nielsen Twitter TV Ratings” title, coming in a partnership between the two companies. So official, in fact, that the two call it the “industry standard metric” which measures all the Twitter activity and conversation focused on television shows.

Obvious move here. Twitter remains much lauded for its “second-screen” experience; while a television event of high interest — like the presidential debates or a big sporting match — is on the tube, Twitter sees large spikes in activity between users talking about the show. So to have an “industry standard” makes sense if Twitter wants to make its pitch to advertisers that Twitter engagement data really does matter.

That pitch, which Twitter has long trumpeted, is that, yes, traditional TV ratings systems of measuring viewers who tune in still matter. But engagement on Twitter focused on the show also matters, and translates to something that ad buyers should care about.

Not everyone is sold on that idea quite yet. Still a question for the ad dudes to mull.

The new partnership isn’t completely unexpected, either. Twitter and Nielsen already have history with each other, having paired up to work on Twitter advertising surveys earlier in the year. And Nielsen bought social tracker SocialGuide last month, so it’s no surprise that Nielsen cares about social analytics.

I doubt that everyone in the Twitter ecosystem is stoked on this, though. Especially companies like Bluefin, Trendrr and Viggle, which earn their meat and potatoes measuring social television analytics and selling that data to advertisers. My guess is that Twitter is offering direct access to its fire hose — the ever-flowing stream of tweets that pass through the company’s pipes every day — straight to Nielsen, what with this exclusivity agreement and all.

If Twitter is setting the API access system up like it has with partners Datasift and Gnip, the new deal is a bummer for the Bluefins of the world, who may have to go through extra hurdles to get that data from now on. I’d imagine that everyone else in the ecosystem would have liked to have the deal that Nielsen got.

Update, 10:51 am PT: That was fast! Bluefin CEO JP Maheu provided the following punchy comment: “Bluefin Labs remains focused on driving new innovations in social TV analytics, not just by focusing on one dimensional ratings and rankings, but by providing rich and actionable multi-dimensional analytics [affinity data] to brands and TV networks.”

This whole thing has to smart a bit for Facebook, too. Nielsen calls it the Twitter TV ratings system, not the social TV ratings system. Ouchy.

Expect the new ratings system to roll out at the start of the 2013 television season.

iStockphoto

That’s according to Nielsen’s latest numbers, at least. For U.S. users, more than a third of the time spent using social networking sites on PCs and mobile devices comes from app activity, the company said in a report published on Monday, besting by far the amount of user activity seen on mobile Web sites.

That’s a big jump from the year previous. Total time spent using social networks via app is up to nearly 41 billion minutes yearly, the study said, close to seven times that of mobile Web activity.

This shouldn’t come as a complete surprise by now. With the proliferation of subsidized smartphones invading the U.S. at a rapid pace, it has become easier and cheaper for people to access sites like Facebook, Twitter and the rapidly rising Pinterest apps via their mobile devices. Each iteration of Apple’s iPhone has sold faster than the one previous, and are available on three out the four major U.S. carriers (and recent rumors suggest we could see the iPhone come to T-Mobile soon).

In the Android world, Samsung has sold millions of its Galaxy S handset series, and myriad hardware makers have brought Android devices to the market at relatively low prices.

PCs, too, aren’t what they used to be. With the rise of smartphones and tablets comes the gradual waning of desktop usage. Hardware giants like HP and Dell have seen reduced forecasts in sales. And social network activity on desktops dipped nearly 7 percent from the year previous, according to Nielsen.

Facebook, still the leading most-used social app, has struggled to catch up with this trend over the past year. The company’s new “mobile first” motto has played out internally, forcing Facebook to devote more engineering resources to developing the Facebook Android and iOS apps.

There has even been a retooling of the company’s team structure in this vein; each separate product team is responsible for their mobile efforts, rather than just one team working on all mobile aspects of the site.

App performance has increased as a result. So, ultimately, Nielsen’s findings suggest that the more attention paid to mobile will only serve to bolster user experience across social apps, therefore increasing engagement across the board.

Now, if only all these social networks could get the whole mobile monetization thing down, they’d really be set.

With all the hyped hullabaloo around just how mobile-icious we are this holiday season — yes, it’s up, but it is also a retailer-cooked trend that reporters grab onto amid the news drought of the Thanksgiving weekend — one of the many statistics spewed out by a variety of sources was rather interesting.

According to IBM, in a report titled “The iPad Factor”:

“The [Apple] iPad generated more traffic than any other tablet or smartphone, reaching nearly 10 percent of online shopping. This was followed by iPhone at 8.7 percent and [Google] Android 5.5 percent. The iPad dominated tablet traffic at 88.3 percent followed by the Barnes & Noble Nook at 3.1 percent, Amazon Kindle at 2.4 percent and the Samsung Galaxy at 1.8 percent.”

And, over at eBay and its PayPal unit — which spewed out all kinds of data on mobile transactions that showed volume was between two and three times greater, mostly on Apple devices — the company noted that one of its bestselling items on Black Friday was the iPad 2, selling 250 per hour from 12 am to 8 am PT.

That tracks on an earlier survey by Nielsen with 48 percent of U.S. children 6 to 12 years old asking for the iPad, followed by iPod touch (36 percent), iPad mini (36 percent) and iPhone (33 percent).

Presumably, which will be used to order more.

Here’s a lovely IBM chart explaining it all:

IBM Holiday Benchmark Infographic BF2012

Twitter is rolling out the tool today, which it will provide for free to some of its biggest advertisers and will eventually offer more widely.

It’s a straightforward idea: Some users will see a tweet asking them to take a survey, and if they click on it, the message will expand within their timeline, and trigger a brief series of questions.

Nielsen will work with Twitter to audit/analyze the results. Twitter hopes that it will be able to use the feature to convince advertisers that they’re getting their money’s worth, and to help them tweak and optimize their campaigns.

For the rest of us, the tool is a good reminder of why Twitter is intent on controlling the way Tweets are displayed, and maintaining  a “consistent user experience” throughout the service — even if it upsets some partners and developers.

That’s because the surveys are essentially small multimedia presentations, and Twitter can only deliver them through its own platforms. This will work on Twitter’s Web site, mobile sites, mobile apps, etc. But it wouldn’t work on, say, Flipboard.

And, while short, text-based surveys aren’t the most amazing things in the world, you can see how Twitter could use that same technology to present much more interesting experiences. Note, for instance, that the company has already shown its interest in e-commerce a few times, most recently via an American Express campaign.

Twitter started out constrained by a 140-character text limit. But it’s clearly set on augmenting those messages with lots of other bells and whistles.

While that pretty much makes it the go-to mapping service on phones, the search giant did not score as high when it came to providing other travel services, such as information about flights and reviews.

Those categories, which people typically find handy to access while on vacation, were dominated by other providers, according to a study conducted by Nielsen, which tracked usage data from 5,000 U.S. smartphone owners.

Nielsen said when it came to other services, consumers were more likely to visit single-purpose apps, such as GasBuddy, Urbanspoon, TripAdvisor or Expedia.

Even though the study was limited to mobile behaviors, the findings suggest the exact opposite of what some feared just months ago — that Google would dominate flight bookings and local search after spending big bucks to acquire ITA Software, the airline data company, and, to a lesser extent, Zagat, the reviews company.

The U.S. Department of Justice ultimately gave Google permission to acquire ITA for $700 million, but the search giant had to agree to a set of concessions designed to minimize the impact to competition.

Google continues to integrate the data it has acquired, so it is still too early to make any final judgments about the potential impact it could have. But if it can successfully leverage its mapping services, it will obviously have a powerful launching pad to reach millions of customers for other services.

For example, in June, 77.8 million U.S. smartphone owners used Google’s maps applications across both Android and iPhone. The second-most popular app was GasBuddy, which attracted 8.9 million users looking for the nearest gas station offering the lowest prices. The third most popular app was also a Google mapping property called Street View, which is available on Android. However, the only content application to make it was IAC-owned Urbanspoon, which provides recommendations for nearby restaurants — similar to Google-owned Zagat.

Nielsen also broke out the most used travel sites. The list provided a much wider variety of services, maybe because people are more likely to need the information at least once, but don’t need ongoing access to the application for future reference. Again, Google Maps was dominant, but many other service providers made the rankings.

Here’s that list:

Nearly two-thirds of U.S. teenagers under the age of 18 say they use Google Inc.’s video-sharing site to listen to music, more than any other medium, according to a new consumer survey from Nielsen Co., one of many challenges facing record companies as they transition into the digital world.

Read the rest of this post on the original site »

And some new numbers from Nielsen that chronicle the rise of “AppNation” on Android and iOS between March 2011 and March 2012 back up that notion. The study shows the average number of apps per smartphone has jumped from 32 apps to 41, and growth in time spent on app usage outpacing the growth in mobile Web usage on smartphones by a hefty margin.

And while Nielsen’s measure of the top five apps — Facebook, YouTube, Android Market, Google Search and Gmail — remained constant, the rest of the top 50 was more of an open playing field, with more than 20 percent of the remaining spots entering as new players, and plenty of maneuvering going on.

Data courtesy Nielsen

According to Nielsen, ethnic minorities were highly likely to have a smartphone, with Asian Americans leading the way at 67.3 percent opting for smartphones. Nearly three in five Hispanic mobile subscribers use a smartphone as do a majority fo African-American phone users.

By contrast, only 44.7 percent of white mobile phone subscribers have a smartphone.

Women were slightly more likely than men to have a smartphone, with 50.9 percent of women having a smartphone compared to 50.1 percent of men.

As for which smartphone people are using, recent trends continue as Android is the most commonly used operating system, running on 48.5 percent of smartphones, while the iPhone is the most commonly used smartphone model, at 32 percent of devices. RIM’s share of the U.S. smartphone market is down to 11.6 percent. Microsoft made up 5.8 percent of smartphone users in the U.S, but the old Windows Mobile accounted for more than twice as much of that than did Windows Phone 7 devices.

But in a new survey conducted during the first quarter, Nielsen discovered that the two devices are not being used for the same kinds of shopping-related activities.

For instance, U.S. consumers are most likely to use their smartphone to find a store and check prices, whereas tablet owners are more likely to do PC-type activities, such as researching products and reading product reviews.

Owners of both devices report frequently making purchases, including 42 percent of tablet owners and 29 percent of smartphone owners.

Last Christmas, the mobile shopping category first started to get retailers’ attention in a big way, leading to new vernacular such as “m-commerce,” or more fun things, like “couch commerce,” which conjures up images of consumers shopping while sitting in front of the TV.

Most retailers, like Amazon, haven’t started breaking out the mobile contribution, but eBay is forecasting that purchases made from apps or the browser on a phone or tablet will hit $8 billion in mobile gross merchandise volume this year, up 60 percent from $5 billion in 2011.

Except that’s not true at all: The Web offers advertisers a slew of creepily effective targeting mechanisms, but they only work for some stuff, some of the time. An ad on the Web may do a better job of reaching its audience than, say, a magazine ad. But that doesn’t mean it does a good job.

Example: Here’s data from Nielsen, via Bernstein analyst Carlos Kirjner, which tracks the accuracy of a recent ad campaign by “a manufacturer of women’s personal care products.” It was supposed to target women between the ages of 25 and 54. But most often it didn’t — the most accurate publisher got the ads in front of the right people 40 percent of the time. Overall, the campaign only hit the target 25 percent of the time. And nearly half the time — 47 percent — the ads got served to men.

Kirjner uses the anecdote to bolster his bullish case for Facebook, which he thinks can do a much better job of targeting than regular sites can, because it knows so much more about its 800 million-plus users.

Maybe. I’ve noticed that Facebook has stopped sending me ads that offer to get me a job at the CIA, or to meet Christian singles in my area, so that’s good. Right now, it’s showing me a banner for the McDonald’s Angus Deluxe, which is more accurate, since I do like food. But not that food.

The Web’s sorta-close, sorta-not targeting problem hasn’t hampered Google, obviously. But that’s because Google’s search ads respond directly to your input and your intent. Now, Facebook, Google and everyone else are going after the branded ads that dominate TV, where the really big money lives. And if they want to get bigger bites of that, they’re going to have to get more accurate.

So the trend line here is skewing upward, and at an increasingly steep incline. According to Nielsen, more than two-thirds of new phone buyers in the last three months opted for smartphones over feature phones.

And the choice of device they made is about what you’d expect: 48 percent went with an Android handset, 43 percent opted for an iPhone, and 5 percent purchased a BlackBerry. That breakdown is similar to the figures for all U.S. smartphones, but with one significant difference: The iPhone has grown more popular among new smartphone owners, rising 11 percent; while Research In Motion’s BlackBerry has declined, dropping 7 percent.