Mark Jung was COO of Fox Interactive Media as of March 2006, the company that was sprung when News Corporation acquired MySpace and IGN, the company that Mark Jung co-founded and headed up as CEO.
This past week, Mark Jung stepped down.
Mark was my boss from May 2005 to December 2005 after he bought the company where I served as VP of Ad Sales. I left in December, 2005 as a result of the integration. To put it mildly, we never quite hit it off. He never gave me much respect. I had no hard feelings, clearly, he did (read on). To read my comments on why Mark might have left FIM, click here.
This week, rumors began to swirl that Mark Jung is in talks with MySpace competitor Facebook. Point is: that’s freaking ironic… though I am sure Mark managed to negotiate a severance package that lets him work for Viacom (or the Democratic party, for that matter…) for all we know.
To show you how much I like to take the high road: I’ll let bygones be bygones and offer Mr. Jung the following advice: Mark Zuckerberg and Mark Jung cannot co-exist in a room the size of Uranus.
My suggestion is: if you are going to report to anyone, choose someone worthy of your pedigree. Have your people call Terry Semel’s people and take at stap at shaping up Yahoo! There are a few people that Mr. Semel could/would bring alongside him to navigate against Google; you are on that short list. There are also a few people who managers and VPs at Yahoo! would look up to and you fit in that short list, partially because of your recent jackpot.
You also have a phenomenal track record at acquisitions and wooing young entrepreneurs and these are all things that Yahoo! could use. After all, Yahoo! bought both Del.icio.us and Flickr yet YouTube is now in Google’s hands. To see why that makes sense, click here.
I can see you working alongside Mr. Semel, but alongside / for Mark Zuckerberg? Who are we kidding? That’s a disaster waiting to happen. You know it, I know it, the American people know it.
As a Yahoo! shareholder, I’d love to see someone with your expertise and vision come in and help shape Yahoo! up.
Ah the irony…
In all likelihood though - and certainly I can be wrong on this - I see Mr. Jung heading out of the spotlight into the VC world; at least for a while.
In an era where VCs are finding themselves on the outside, Mark is an asset to any VC who is looking to lure young minds. He did time and time again over the past few years, with RottenTomatoes, AskMen, TeamXBOX and many others. The VC that took IGN private in 2003 and cashed in biggatime in the FIM sale is Boston-based Great Hill Partners, who would probably welcome him with open arms (assuming they had a civil relationship before the sale to FIM).
All signals point to something like that. Anyone who knows Mark (and I only met him some 10-15 times) knows that the mere notion of him reporting to Mark Zuckerberg is ludicrous.
Let alone the fact that Mark Zuckerberg’s VC deals have a clause that Mark Zuckerberg remain CEO so long as he chooses to. Mark Jung made some good money in the News Corp. deal and unless he loves Facebook, he’ll pass on babysitting a young CEO.
Besides, I think he probably got his share of turf battles at Fox Interactive Media with the deep bench and talent they had. At Facebook or at Yahoo!, he’d put up with more soap opera nonsense than someone of his intellect and experience (and nestegg) would care to put up with.
Mark my words.
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WatchMojo NewsletterLike many, when I heard that venture capitalists Sequoia - of Yahoo!, Google and Youtube fame - had plunked down $5M in PopSugar.com, the “addictive celebrity blog,” I fell off my chair.
Had the VC in question been any other VC, I would have chalked it up to irrational exuberance over blogs. The blogosphere is indeed robust as a whole, but this only means that it’s ever harder for individual blogs to gain much traction.
According to Technorati, who tracks 57 million blogs, 100,000 new blogs are launched every day (though this includes spam blogs, or “splogs/blams”). Of course, it’s key to state that no two blogs are identical, and I personally think that we need to differentiate between personal diaries, online magazines that use blogging software, link dumps that use a blog platform etc. But the lines between these are fairly unclear and blogs (whatever category they fall in) tend to morph as opportunities and threats appear.
All to say, I knew I had to dig deeper. You will have to forgive me for not being very familiar with PopSugar.com, after all, I am certainly not in their target market. Given the pedigree of the VC in question, I had to dig deeper, but between analyzing the value of Wikipedia.org were it to be a for-profit, estimating when Google could overtake Microsoft in market value and managing the Mojo Supreme network of sites, investigating the “PopSugar rationale” kept falling on the backburner.
This week I spoke to Eric Olsen of Feedburner, a company we’ll be working with over the next little while on our own BloggerMojo.com blog network. I checked out his blog, and came across a post on the recent added interest from VCs over blogs. Of course, blogs are not anything new. Mark Cuban financed Jason Calacanis‘ blog network Weblogs Inc. a few years ago and the company had a successful exit in the sale to Time Warner’s AOL unit for a reported $25 million.
But the fact remains that in that deal, it was not the McDonald’s of blog networks (as some unfairly consider Weblogs Inc.) that really got AOL excited (or the $1M annual run rate), it was perhaps Calacanis himself, who was on his second successful dot com venture and could offer some young blood to the company’s bench over years to come. This turned to be true as Calacanis was handed the tough mandate to turn things around at Netscape (though it was doing fine and needed no such thing) and remake it into a Digg-clone. I’m not knocking Netscape by calling it a Digg clone, that’s just the vibe that the new Netscape is giving its own users as it searches for an identity.
So Weblogs Inc. notwithstanding, the blog network model was still largely untested from a VC perspective, after all, Mark Cuban was more of an angel investor and not a traditional venture capital. While numerous other networks have made a name for themselves and carved out a profitable niche - like Nick Denton’s Gawker Media - the truth is that most VCs were excited about the bells and whistles (or helmets and shovels) that could help blogs and bloggers, but not the blogs themselves.
Case in point, I was shocked to see the number (and quality) of VCs who invested in Feedburner: the company is funded by Mobius Venture Capital, Portage Venture Partners, Sutter Hill Ventures , Draper Fisher Jurvetson and Union Square Ventures. That’s a hell of a lot of backers for one company. Then again, they know something I don’t.
But when a VC like Sequoia writes a $5M check for a blog, you have to pause and take notice. Of course, upon further digging, you realize that the company behind PopSugar.com is Team Sugar, and behind Team Sugar is Sugar Publishing.
And when it comes to Sugar Publishing, you can’t help but look at its bench. If VCs invest in people and management, then Sugar deserves what it got.
Women’s Market
The company consists indeed of a blog network, targeting women mainly. Other blogs include FabSugar, DearSugar and FitSugar. In fact, Sequoia has taken an interest in the blog network and/or the women’s publishing market. When iVillage gets acquired for a cool $600 million by GE Universal, I can understand the excitement. More importantly, iVillage’s audience, according to online audience measurement services was 15 million or so. While the largest of web properties have hundreds of millions in uniques, iVillage’s 15 million count is not a high number, and suggests that a blog network targeting women primarily could hit those numbers and create a valuable holding for a VC.
Social Networking Element
Of course, investing in content alone is so passe. And, the advertising market for blogs is fairly nascent so there is no guarantee that Pop Sugar and its related blogs could hit such lofty revenue numbers, of course, underneath all of the content, trackbacks and comments is the fact that PopSugar also boasts a social networking element, and we know how excited VCs are with those, especially in light of MySpace $580M sale to News Corp. and Facebook’s $1 billion price tag being thrown around.
Consolidation in Linkdump category
One thing that I have expected is for there to be a consolidation in the linkdump category of websites: Fark, and company (Fark is essentially social bookmarking before the term came in vogue).
I was expecting for someone to come in (private investors or a VC), consolidate a number of the linkdump sites with little or no content, amalgamate a massive audience of 10-25M and be in a position to ask for better advertiser clients, higher rates and what not.
The main challenge that sites like Fark.com face in in fact that they have no proprietary content. I know Fark’s Drew Curtis and he is one of the smarter entrepreneurs out there, but the fact that he has no content of his own will always handicap him a bit with marquee advertisers. This year Dennis Publishing, publisher or uber men’s magazine Maxim decided to buy/sell inventory on Fark. I am sure there was even some talk of an outight sale, though this is unconfirmed.
The content that Fark bookmarks from around the Web is somewhat controlled and filtered, so it will not have as much of a hard time as social networks (who have larger audiences but far more risque content) to monetize the traffic with quality advertisers. With Maxim’s magic touch, it has already started. But there is one Fark for a million… others.
While there has been some consolidation in the segment, it never really materialized (InterActive Corp. for example bought another popular link dump site, College Humor, though College Humor has over the years added its own content and cannot simply be seen as a link dump). One reason I personally think this whole consolidation did not materialize is that VC or private equity investors would probably not feel comfortable in the management depth chart of some of these sites. As such, they passed up on the opportunity.
Consolidation in Blogosphere
This is important in this context because while many blogs have content to speak of, the bulk of the “action” on the sites consist of links out to other sites. A blog is a broad term and can in fact be many things, but it can be seen as a beefed up link dump on steroids. As such, it is highly possible that blogs, with their low overhead and scaleability will be consolidated over time, because for a blog to be really successful when 100,000 are launched every day, you need a lot of content, all the time.
This is a key variable and differentiator: for an online magazine to keep the content coming, it has an arsenal of writers, editors and partnerships to keep it coming. For a blog, it requires passionate people who live online and whose fingertips are attached to the keyboard.
All Road Lead to Rome
In other words, while many standalone blogs will remain that (and God bless those), over time many more ambitious and economically driven bloggers will become integrated into blog ad networks or publishing networks; conversely, other blogs will spawn as blog networks immediately.
At Mojo Supreme, when we planned and devised the Blogger Mojo blog network, we picked ten categories that we felt we wanted to have a presence in from Day 1:
- ArcadeMojo.com: Video Games & Comics
- DriveMojo.com: Cars and Automotive
- EscapeMojo.com: Travel
- FashionMojo.com: Fashion, Trends & Style
- FlickMojo.com: TV & Film
- HipMojo.com: Internet
- MDMojo.com: Health
- SoundMojo.com: Music
- WarMojo.com: Sports
- WorldMojo.com: Business & Politics
I personally consider this network to still be in somewhat stealth mode, because we were concurrently building a Web TV property (WatchMojo.com) and a vertical search engine (MetaMojo.com), as well as numerous other properties.
Our objective is to launch ten more in year 2 (2007). We would never want to become like Weblogs Inc. and have over 100 blogs. b5Media, another blog network that got financing also boasts over 100 blogs.
The point is that the same way that no two blogs are the same, no two blog networks are similar either. Of course, it’s fitting that much the same way that our blogs are branded to the Mojo moniker, Sugar Publishing runs sites with “sugar” (the founder’s last name, mind you) and blogger flavour du jour Michael Arrington runs Crunch-branded sites (TechCrunch, MobileCrunch, TuneCrunch, and CrunchNotes).
The one common thread though, perhaps, is that some entrepreneurs are allergic to content while others are passionate about it. There is money to be made in the industry, but the successful ones who can offer something of value, build an audience, and then subsequently engage outside financing if they think it can actually help their business; in other words, securing financing for the sake of securing financing might take a lot of the fun and freedom that comes from blogging away.
Online audiences may soon wish the Web was equipped with a fast-forward button. Spending on Internet video advertising is set to explode next year, growing nearly 90% to $775 million, according to an eMarketer study released Nov. 6. By 2010, online video ads will bring in $2.9 billion, making up 11.5% of the online advertising market, the researcher says.
(…)
The growth of video advertising is being fueled by the increased availability of broadband Internet connections that let computer users quickly receive the large amounts of data necessary to watch online video. More than two-thirds of active Internet users had a high-speed connection as of earlier this year, compared with 55% in early 2005, according to Nielsen//NetRatings.
(…)
Not that advertisers are by any means abandoning traditional media. The almost $3 billion expected for online video ads in 2010 will represent less than 3.3% of the total devoted to TV commercials that year. And it’s barely more than 1% of the $284 billion that eMarketer anticipates advertisers will spend in total in 2010.
Read more.
We’re seeing RSS feeds increase awareness in the mainstream, look out for them to take off in 2007. Read more.
In 2005, 47 search startups — a record for one year — received more than $260 million in venture funding, according to Dow Jones Venture Wire. The total sum of that backing was the high-water mark since 2000, when nearly $280 million was invested into 18 search startups.
Taken from Marketwatch’s article on Powerset, the natural search engine launching in spring 2007, who got $12.5M on a valuation of ~$40M. Here’s other things we’ve written on Powerset.
I sold my MSFT shares in the mid $28 range a month or so ago after holding on to them for over two years. I made a small capital gain return but did also make that one time nice dividend return as well. In the end, the stock was just too large to move and there were better stocks out there.
The reason why I sold was because I added to my position in summer when the stock hit a low of $22 and change. When I got a letter asking me if I wanted to participate in a Dutch auction to sell my shares, I knew that investors would balk (many I figured had gotten in at much higher levels), forcing the company to up the price.
I think it worked. Between the low and current prices, the stock is up almost 30% in just a few months.
Today I read that Microsoft’s vice president of entertainment and devices division (which oversees Xbox), Peter Moore, forecasts 13-15 million Xbox 360s by end the end of 2007, considering the news todat that just one year after the November 22, 2005 launch of the XBOX 360, MSFT will be unleashing over 1,000 hours of programming and getting TV content to an audience that has in the past few years avoided television for video gaming, this is an interesting development. We’re talking content from Ultimate Fighting Championship, CBS, Viacom, WB and many others.
Not only is MSFT actually executing on its vision of using the XBOX 360 as the entertainment hub in homes, they are suddenly on the inside lane when it comes to reaching the elusive 18-34 male… and best of all, it just gave a major reason to gamers not to buy the Playstation and opt for the XBOX.
Microsoft, are you getting your Mojo back? Who knows.
But with the upcoming launch of its music player Zune, there could be some major, major integration with the XBOX.
To read how MSFT lost its ways, read this.
Bill Gross is trying to get on track to sleeping at night again after Google stole his Idealab-backed Goto.com (Overture)’s cost per click model of advertising. Goto.com was acquired for the nice, tidy sum of $1.6 billion by Yahoo!, but Google borrowed the model and now boasts a $140 billion market cap.
Bill Gross decided to move on and launched Snap.com (no relation to the original snap.com). Snap.com is essentially a search engine whose business model relies on charging clients on a CPA basis. Snap.com has gotten a lot of love from the press over the past months, but it has yet to set the search stage on fire.
Today we learn on PaidContent.org that AdWeek is reporting that former Excite and Altavista search man Jim Barnett is launching Turn, also a CPA player in search.
UPDATE: it should be noted, that Turn is not a search engine. for exactly what it is, click here.
Interestingly, search players are getting funding again: yesterday Powerset reported getting funding too, and at the risk of doing some shameless promotion, our very own MetaMojo.com (a domain specific vertical search engine is seeing an uptick of calls from interested parties in the past month), though I think the reason for that is that my belief that technology alone does not necessarily build a business is starting to reasonate with others. You need content to get people to interact with your technology products, otherwise, customer acquisition costs are too generate a decent profit.
Anyway, another reason why investors are again backing search entities is that while Google, Yahoo! and MSN are fighting the search wars, there is a lot of room for add-on’s, complementary applications that they can one day simply acquire and integrate into their own arsenals.
Of course, with the kind of money these search startups are raising ($12.5 M for Powerset on a large valuation), it will be hard to get decent buyout offers that make the investors make money, but hey, since they’re the “smart money” I am sure they have a master plan.
As Cyworld invades MySpace’s Turf in America, News Corp. Enters Alliance with Softbank to Strike Back in Japan
Read more.
Business Week ran an article in its October 23rd issue called: “Web Numbers: What’s Real?” I was expecting the folks at Nielsen NetRatings and or Comscore Media Metrix to answer. I was right.
However, I was hoping that Business Week would publish responses from both companies. They did not. Maybe Nielsen NetRatings did not answer.
Incidentally, it was comScore’s CTO, Mr. Gregory Dale (and not their CEO or CMO) who sent in a letter. That just adds to the authenticity of things doesn’t it? “Let’s send in the big technical guns, this is Business Week after all, the publish on paper! Who are they to talk about circulation?”
“Web Numbers: What’s Real?” discusses a recurring theme, asserting that third-party online audience metrics are somehow inaccurate because they do not match a company’s internal logs.
Yes, indeed, that is a question worth examing Sir.
“Third party estimates are very specific in what they measure, and they do it consistentlay across all players. The rules truly are the same for everyone.”
Indeed, the criticism of online audience measurement services runs across the board: sites large, medium and small all agree that your (and NNR’s) measurement is off, consistently, and across all players.
The automatic assumption that a company’s internal server log data “must be” 100% correct is very often unfounded.”
Really? Who “unfounded” these numbers? And who “automatically assumed” that server logs must be 100% on the spot? Most sensible publishers account and adjust traffic for a variety of reasons. No one said server stats should be 100% in line with your numbers, or NNR’s numbers… but are publishers to blame when numbers are so off?
In the vast majority of cases we investigate, the comScore Networks Inc. numbers prove to be sensible and correct.
So you admit there are investigations? Who asks for them? What is the methodology of the investigation? If publishers doubt the methodology of your results, why would they - or anyone - trust the methodology of your subsequent investigation? If the LAPD could not nail OJ Simpson, do we want them investigating what went wrong?
Internal data often overcount audiences for a variety of reasons, such as counting cookies instead of people, and often include pageviews not requested or seen by end users.
Cookies and pageviews not requested by or seen by end users have become the boogieman, or dare I say the cookie monster in the industry. Cookies or unrequested/unseen pageviews could explain 10, 20, 35% discrepancy but when your numbers are 50-75% off, how much cookie can a man have? Furthermore, we’ve already explained here that this argument is a red herring. Truth is that if this was the case, advertisers would never pay what they buy. Advertisers might plan media buys using panels’ stats but they buy using a site’s numbers. Read more.
Regarding the article’s assertion that online advertising is a crapshoot, we categorically reject the statement as ludicrous.
Let’s consider your statement. Why don’t NNR and comScore’s numbers match? Both are panels? Sure they have different methodologies… but isn’t it ludicrous that even the panels out there do not publish numbers that match? If they do not, how could we possibly not think that the numbers are indeed anything other than a crapshoot?
The fact is that the Internet has more precise third-party measurement than practically any other established media, including television, radio, magazines, billboards, etc.
True be that. But just because online audience measurements are better than their offline brethren does not make your online audience measurement services reliable in and of itself. If anything, it shows that the panel approach is not necessarily the best way to ensure that online audience measurement becomes as good as it can get.
[Online audience measurement] features sample sizes that are orders of magnitude higher than offline measurement systems. The data collection methodology is much less intrusive and far more reliable than paper diaries, readership surveys, or electronic people meters. It is also very cost effective since clients pay a small fraction of what offline media outlets pay for much less robust, detailed measurement.
There are two issues: indeed online systems are better than offline measurement systems, much the same that online advertising is more effective etc. than offline advertising. But, the fact remains that panels are inherently biased and actually measure/reflect the traffic and surfing patters as they are trickled from the top few sites.
A simple reason is that sites that are linked off the major portals or indexed highly off the main search engines will get a better measurement when you use a panel. The entire Web universe does not live on the major portals and have their random walk to get to anyurl.com, but when you consider a panel, you see valleys and peaks that are driven by a website’s interaction with the major portals and search engines, even if a site’s total traffic from all sources suggests a very different pattern.
comScore’s data are used by more than 600 clients, including industry giants such as AOL, Google, MSN, and Yahoo!
600 clients out of all of the companies that you would think would view your data as gold? That’s not a lot, now is it? In fact, assume 75% of that client list represents online giants like those you mention, and 25% represent traditional media companies. These are companies that generate anywhere from $25 million and over per month. For them to pay $25,000 to $100,000 for your services is akin to buying insurance. Insurance - or InCaseShit in the words of the great Chris Rock - is something you buy even if you do not necessarily want to. The same way we are driven into a paranoid frenzy to buy insurance, well, we’re intimidated into thinking that no data means shaving in the dark with a spoon; when the simple truth is that even those large sites do not put 100% faith in your data.
The types of companies have ample opportunities to examine and use our data.
Yes they do, but they still do not trust your numbers as much as they trust site-specific numbers. When Company X bought my former employer, they put about as much weight on panels’ online audience measurement services stat as I do on the weatherman in the morning: it’s nice to know what they say but I’ll believe it when I see it. When push came to shove, the way they went about to ensure that our numbers were what we said they were, they used a site-specific tracker.
That’s from an investment perspective. To get an advertiser’s perspective, click here.
Fortunately for us, they are voting with their checkbooks.
See insurance. Think mafia. I take out my checkbook for a number of things I wish I did not need to. And somewhere, somehow, an entrepreneur is coming up with a way to ensure that I won’t have to eventually.
Their ranks grew by 30% in the last year alone, which would not have occured if online audience measurement was a crapshoot.
You would think that if online measurement services were to robust, it would grow far momre than the industry’s average growth. The fact that you only grew 30% - despite it being supposedly so important to investors and advertisers - suggest the relative dissatisfaction and rising cynicism over panels. And, like I said, it’s insurance. If I am making $1M a year, let alone a month, it’s a small price to pay to be on your sides, in your good books. It’s protection money, online-style.
We understand the pressure some companies feel to report higher numbers because it is a reflection of a site’s popularity, competitive strength, or a manager’s personal performance. For some companies it can be a matter of survival. This is why unbiased third-party services like ours are needed.
I would consider getting NNR and comScore myself even though I doubt the numbers are 100% correct, but what I do not appreciate is having someone, CTO or salesperson, tell me that they are 100% right and we the publisher are 100% wrong. Of course, the instant these companies admit that there might be a lack of confidence, then they prove hollow and the house falls apart. It’s a tricky situation, but one that the companies’ arrogance has put them in. In the early days, online audience measurement services had a chance to work with publishers to get it right, and they did not.
We work hard to stay abreast of the ever changing Internet landscape, and we measure all players fairly and consistently. Our job is to do our best at faurly reporting online audiences, unmotivated by any biased interest in claiming larger audiences based on potentially flawed internal data.
Hmm… if your numbers and methodology are not “flawed,” how many cases are there when comScore or Nielsen NetRatings actually overestimates a site’s internal numbers? Think about it. It’s basic stats: if comScore or Nielsen NetRatings use panels, then it’s all stats. But because it’s stats, then by the science’s nature, there need to as many cases of underestimation of traffic as there as cases of overestimation of traffic, no? Since there are no cases of overestimations of traffic, then clearly your method is flawed too, right? I certainly welcome someone to correct me on this (be it on my misinterpretation of their methodology or there existing sites whose traffic is overestimated by comScore or Nielsen NetRatings).
If there is a crapshoot, it’s companies bragging about internal data that are inconsistently computed and typically inflated.
Back to square one: the arrogance. We’re right, you’re “inconsistently computed and typically inflated,” how do you wish to pay?
I still have not had anyone answer my previous question: if site stats are off? why do advertisers - who have billions at stake - buy media based on a site’s stats? Click here to read that.
