The trend will like find its way across the pond to the US where a similar story is happening.  Outsell, a company that specializes in information research and analysis, found that out of 1,000 US advertisers surveyed, they found that companies plan to spend $119.6 billion on online ads and digital strategies.  Only $111.5 billion will be invested in print advertising such as news papers and magazines.  Thus online advertising appears to lead print by 1.2%.

So although companies will spend more on advertising in 2010, most of that will be directed into the online ad market.  Most forecasters predict that this trend will continue until the sales of newspapers and magazines recover.

The mobile ad rush is accelerating too.  Google recently acquired a new patent for location-based advertising.  According to Venture Beat,

“Location-enabled search and advertising has been a major priority for Google over the past year. Last week, it started letting users refine their search by location to see results published nearby. The company’s newly-launched Buzz service also has location feeds with content that often beats out what Twitter’s geotagged tweets have to offer.”

The location-based ad patent may prove to be a valuable weapon as Google goes head-to-head with Apple in the battle for the mobile ad market.   Perhaps fearing a user privacy backlash, Apple has been slow to adopt location-based advertising.  The company claims that “If your app uses location-based information primarily to enable mobile advertisers to deliver targeted ads based on a user’s location, your app will be returned to you by the App Store Review Team for modification before it can be posted to the App Store.”

Regardless, both companies have recently made their bids to acquire mobile ad networks. As we reported earlier, Google bought Admob for $750 million in November, while Apple bought Quattro Wireless in January.

So it is no surprise that these major websites have entire armies whose job it is to make sure that every millisecond counts.  According to an article in Venture Beat, Blazing-fast Facebook pages boost member use, increase ad revenue, Facebook engineers broke down the sites delay time into three different parts: Network response time, page generation time, and page render time.

The engineers determined that it was primarily network and render time that slowed down speed.  To fix these problems they determined that drastically cutting down the bytes of cookies, HTML, CSS, and JavaScript would allow pages to load quicker.

Over the course of 6 months Facebook’s engineers cut cookie bytes by 42%, CSS bytes by 19%, and HTML bytes by 44%.  And the work paid off.  Users will now typically spend about half the time waiting for a page to load.  And this is great news for Facebook since users will now conduct more searches and generate more revenue for the company.

The catch 22 of course is that the ads themselves are bogging down the sites.  While the companies rely on the ads for revenue, it is also the ads that are hurting the companies by slowing down the page loads.  Hopefully the ad networks will come to the conclusion that speeding up their services will generate bigger revenues for themselves in the long run.

Our second featured ad network is Bedrock. Bedrock is an ad network which empowers publishers to create ad units they feel are most appropriate for their audience… and they’re quietly turning the current ad model on its head. Recently, we were able to have a phone interview with Ophir Tanz, CEO of Bedrock. Below is the transcription of our phone interview.

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AdNetworks.NET: So your network puts a unique twist on the current ad network model, could you help explain?

Our ad network is similar to Google AdWords to the extent that advertisers come to a centralized marketplace and buy keywords on a CPC basis. The difference is they don’t provide any creative, they say, ‘send traffic to these keywords and this is what I’m willing to pay for a click,’ and we say, ‘we will send relevant traffic for the specified keywords and you can modify your bids relative to the ROI you are seeing.’ Publishers are then empowered to create ads. The ads can be embedded within content, widgets, rss feeds, really anywhere they choose. What makes Bedrock especially powerful is we enable publishers to monetize inventory that they previously haven’t been able to monetize.

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AdNetworks.NET: Sounds very interesting. How did you see this opportunity?

Bedrock was actually borne out of GumGum. GumGum is an image-licensing platform and one of our licensing solutions is an ad-supported model. When publishers opt into this licensing model we overlay an ad on top of a photo and monetize the license with the associated ad revenue. The problem we faced was that traditional ad networks are not built to allow you to overlay ads on photos. So we had to figure out a scalable solution to monetize non-standard inventory on GumGum before Bedrock even existed. As the solution materialized, we took a step back and said ‘wow this works really well and all these web companies with huge amounts of inventory have the same problem and are leaving billion of eyeballs unmonetized.’ We decided to open the platform up to publishers at large and Bedrock was born.

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AdNetworks.NET: So how are you monetizing, is it just CPC?

Yes, 100% CPC.

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AdNetworks.NET: How do you define “quality” when selecting publishers for the Bedrock network?

Good question. Typically, we work with very large publishers and advertisers. We’ve found it makes the most sense to work with the biggest buyers and sellers (such as a myYearbook, Hi5, Tagged, ClearSpring, etc.) because they have the resources and management systems in place to most effectively leverage Bedrock. Sellers need to create ads which requires resources and buyers need to manage bidding which takes work. Increasingly, we are working with vertical publishers as well. For example, in the auto vertical we are working with some large, successful publishers (such as cardomain.com and other players in the space). We will continue to open up the network over time. Today, Bedrock is not something a mom and pop shop could, or necessarily should, use.

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AdNetworks.NET: What has been the reception so far from Advertisers and Publishers?

Advertisers:
The reception has been unbelievable! On the advertiser side it’s really a no brainer, you go to the marketplace, you specify the keywords you want traffic for and we send traffic and provide real-time reporting. If you want more traffic, you increase your bids. So advertisers on Bedrock are receiving traffic at a price point that makes sense to their business. Of course, if the advertiser bid is too low and they are being outbid by other buyers they’re not going to recieve much traffic.

Publishers:
Bedrock is a game-changer for publishers more than anyone else. We enable publishers to finally break away from IAB standards. Rather than build a site around IAB standards, as most sites do, publishers can build their properties and services in the manner most compelling to their users and integrate ads in a similar fashion. Beyond this, and perhaps most importantly, publishers are able to monetize previously impossible to monetize real-estate. For example, publishers are able to monetize RSS feeds. We work with a few internet companies who have tremendous reach because they syndicate RSS feeds but they haven’t been able to monetize those feeds effectively until Bedrock came along. They integrate ads in-line with the feed, and, of course, call out sponsored links as such.

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AdNetworks.NET: Do you have any early results that you’re able to discuss?

Certainly. Before joining our network CTR was around 0.1% for many publishers on a good day, in fact, for most IAB ads on the Internet this is considered a good CTR. After joining our network they began to see CTR’s upwards of 3%, 5%, 10%, even as high as 30%, and what that does for monetization is really amazing. Taking a CTR from .1% to 10%, represents a 100x increase in monetization. There is a growing phenomenon of banner blindness where users have trained themselves not to look at certain areas of a web page. We are reintroducing ads back into the story in a more natural and relevant way.

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AdNetworks.NET: How much customization does the publisher have?

Customization is Bedrock’s key differentiator. Bedrock is easier to integrate than any other network in the world. There is actually no “integration” that takes place, there is no embed code or on-site setup process required. Publishers create the ad just like they would any other type of content – an image in Photoshop or a text-link generated via a Wordpress CMS, then they simply hyperlink the ad to our marketplace – the click comes through and the URL contains parameters in the query string, such as keyword, that we run a real-time auction on. We then send the click over to the highest bidder.

It is interesting to note that publishers typically have more awareness of their audience than a 3rd party ad network ever could. Publishers are able to think about their audience in non-linear ways, something 3rd party ad network do not do well. For example, a publisher may know that their users are interested in expensive cars even if the site is about something else entirely, like finance or travel or fitness.

To be clear, our aim is not to compete with Google or Yahoo. We believe they provide a valuable, rich, and very effective service and will continue to be key revenue generators for publishers for the foreseeable future. We provide incremental, yet meaningful, revenue opportunities that enable publishers to monetize their properties and services more effectively.

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AdNetworks.NET: How do you compare with adsense and yahoo?

Today, because we obviously have lower volume on the buyer side of the market than the giants in the space, publishers will often see CPC’s that are a tad lower. However, the idea is that the higher CTR more than makes up the difference. Beyond this, if you’re driving quality traffic then more advertisers will bid on your traffic thereby driving the price up.

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AdNetworks.NET: How do you define quality traffic?

We don’t maintain the notion of quality internally at Bedrock. We don’t even maintain the concept of impressions because we do not put any tracking code on the publisher’s site. In the same vein, we don’t directly know the CTR publishers are generating. All we are aware of is how many clicks are being driven into the marketplace. Publishers know their CTR and advertisers know their conversion rates and that is what is important. One publisher might be sending quality traffic to a very happy advertiser and another advertiser might get that same traffic and deem it to be low quality, per their definition of qualtiy. Different advertisers are able to bid different amounts for identical traffic based on their own internal measures of quality.

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So there is complete insight into the publisher?

Buyers can see which publisher’s are sending them traffic, but we don’t report the seller site URL, it’s obfuscated. This plays the dual role of incentivizing publishers to send qualified traffic through the marketplace.

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AdNetworks.NET: What types of geo-traffic are advertisers able to target?

Currently support geo fully. Most focused in UK, Canada, and US.

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AdNetworks.NET: Where do you see the ad network community heading over the next year and what role do you hope for Bedrock to play?

I see publishers as generally having been under-served by traditional ad networks. GumGum is a good example of a network with lots of quality eyeballs, tremendous reach, really interesting inventory, and we simply were not given the opportunity to effectively monetize this audience. I think that’s because sites, services and distribution mediums have grown faster than the ad networks have been able to keep up with. We see a lot of new inventory being created thanks to Bedrock and we see publishers making a lot of money as a result. Furthermore, advertisers are able to get at traffic they have never been able to get at before, as the ad units and placements never existed before, so there is newfound value.

One of the most exciting things for us is getting publishers excited about the platform. As they understand how it works and it proves it’ value we see publishers dedicating entire teams to monetizing with Bedrock. So what that means, at the end of the day, is publishers have increased responsibility, but with that comes tremendous opportunity. It’s exciting to see truly new inventory on the Internet from an ad perspective. Publishers in a distributive context are going to come up with much more interesting creative than a single company ever could on it’s own.

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For more information check out Bedrock.com

Alex Baydin, the former manager of Epic Advertising, has started a brand new and “more transparent” company called PerformLine. This new company has spotted a major opportunity to help advertisers better monitor where their products and services are being placed.

PerformLine and other companies are using an automated system to verify that page views and leads are real, rather than incentivized. They also look to see that sales resulting from the networks’ placement did not involve deceiving consumers and that they are located on the sites that the networks claim. According to an article in Wired.com, Ad Network Vets Now Trying to Clean Up Their Acts, the techniques used to police the ad networks will likely involve JavaScript tags, web crawlers, automated screenshot analysis and tracking pixels. Of course the last technique is only possible when an ad network wants to cooperate. But ad networks are increasingly more willing to cooperate in order to maintain credibility with their advertisers.

Credibility aside, ad networks are also increasingly nervous that if they do not begin policing their own industry, then the government will. So the incentives to adopt these techniques is obvious not just for advertisers, but for ad networks as well.

Business is booming over at NetShelter Technology Media as they are now the biggest tech media company in the world in terms of audience reach.  Surprisingly, they were able to aggregate over 100 million uniques in less than 3 years.  In fact, just last October they only had 50 million unique visitors… so this company is growing fast!

As the economy struggles one would expect any company that relies on advertising to have a similar fate.  Nevertheless, NetShelter Technology is expected to announce revenue growth between 50-70% this year… which is rumored to be higher than any of their competitors… which include Glam, Jumpstart and FM.

The launch of their Wisdom of Crowd/Influencer based programs have been very successful as they have been able to form strong partnerships with Microsoft, Best Buy and Blackberry… among others.

It will be interesting to watch this company over the coming year and see if they are able to maintain their momentum.  Also, with this type of growth they could be an excellent acquisition target.  We will keep you posted.

In case you’re looking to online video advertising, AdNetworks.NET has put together a list of 7 ad networks with varying models worth checking out:

Auditude: The Palo Alto based company has raised $23 million in funding and is working with partners such as; Warner Bros, MTV, and Yahoo. For content owners they help find and monetize their content across the web while effectively compensating publishers. Furthermore, they offer advertisers premium video ad inventory.

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InskinMedia: InSkinMedia offers InSkin and iRoll.  Inskin involves wrapping a classy ad around the video… which is arguably less intrusive for the user since it doesn’t directly interfere with the video.  iRoll provides the basic pre/mid-roll functionality plus some of the InSkin technology during the roll and more opportunities for the user to engage with the advertisement.

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Tremor Media: Tremor Media is the largest video ad network in the space and it’s not by chance that they have become the largest.

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VideoEgg: VideoEgg prides itself on being “the engagement network” and has effectively established itself as a leader in creating user engagement in the video space.

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Nabbr: Nabbr is the leader for reaching millions of Gen Y users on the web through premium video content. It’s worth noting, the company appears to unofficially define “Gen Y” as 12-34 yr olds. Their videos have been viewed on the web nearly 6.5 Billion times and they were a top 10 video ad network according to comscore.

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ScanScout: ScanScout connects advertisers with consumers through in-stream video ads. They were recently named the top video ad network in 2009 by FierceOnlineVideo.  These guys have one of the best reputations for providing advertisers with tangible results.

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Vdopia:  Vdopia is the largest Video Ad Network and Video Ad Platform that targets Indians across the world. It provides advertisers with the opportunity to advertise on some of the most premium online video content available on the internet.  The team is composed of industry veterans with impressive backgrounds.

According to the article the two heavyweights are Todd Tran and Andy Miller.  Tran will assume the position of general manager of Apple’s European mobile ad network.  Miller will be named as Vice President of Quattro Wireless, a mobile advertising company recently bought by Apple for $275 million.

Just recently Steve Jobs, never one to pass up a good fight, claimed, “Google do no evil is bullshit.”  The frustration is obvious considering that Google wants to take down the iPhone with it its new “Nexus One.”

While Apple is relatively new to the ad industry, its resources including the App Store for the iPhone and iPod Touch will mean limitless potential and growth down the road.  The free applications that define Apple are often supported by advertising.  And with the success of the App Store and its 140,000 options, Apple sees marketing as the most important revenue opportunity.

In a continent with over 50 million internet users, the advertising network is remarkably untapped. It was only in 2008 that, SabiOne, the first pan-Africa ad network was launched. Another major ad network, Afrigator, was only just recently launched as well. While SabiOne has capitalized on major online news publications, Afrigator is pursuing a strategy of aggregating the African blogosphere.

With internet usage in Africa growing exponentially, 2010 will certainly be a year where major evolutionary changes occur in the way that media agencies target their consumers. Because Africa is a culturally diverse and fragmented, the ad network model will best deliver that evolutionary change for the pan-African online Market.

Yet according to a recent Reuters article, Rejected or not, Super Bowl ads generate buzz, ads can still tap into the Super Bowl hype without even paying for the $30 million spot.   The news and attention that’s generated when an ad is rejected for inappropriate content is enough to drive visitors or business to a company’s website.  Getting rejected is a rare high-profile opportunity for these advertisers.

The internet domain company, GoDaddy.com, has already generated hype in the past with its provocative Super Bowl ads.  But advertising executives at GoDaddy have discovered that by pushing the envelope too far, their rejected ads can generate as much attention as their Super Bowl ads had in the past.  And all for free.  This past Thursday the company invited viewers to watch its latest rejected ad on the company website.

Companies such as People for the Ethical Treatment of Animals (PETA) and Mancrunch.com, a gay dating site, have all had similar experience with their rejected ads.

As other advertisers begin to catch on to this loophole in the submission process, we can expect a whole cottage industry emerging where companies try their best to exploit a network rejection.