UKNM: Re: UKNM Digest V1 #650

[GI]

>From Geoff Inns:


I'm on the digest so I may have missed some stuff

here.


Interesting to read Tim Moore's comments. I don't work

for a portal so it would be hard to qualify what I

say, but mainly composed from the odd bit of truth

from the portals!


Most of them seem to be making very little money out

of e-commerce.  MSN rarely agree to a yield-based

placement now, instead focusing on more of a

relatively low cost tenancy model.  Most portals who

have yield-based deals (and the e-commerce companies

are insisting on them now) are making very little

money.  Once familiar with a brand, users tend to go

straight to that site when they need something.  Many

times I have seen the Amazon button and gone on to

type in the URL later in that user session, rather

than clicking on the button.


It should be fairly safe to assume that not many of

the portals/ISPs are going to make any serious cash

out of access anymore.


So now the emphasis is set squarely on advertising and

sponsorship.  To make that economically effective they

need brand strength combined with compelling content. 



This is changing the nature of content deals for

example, where portals are now most keen to ensure

partners display content in the portal look and feel,

or at least a co-brand.  They need to appear to the

user (and the planner/buyers) to be extending their

content reach.


The new battle for the portals will be if

"user-desertion" figures go up any more i.e. they

log-on and exit the site, preferring to surf the web. 

Just ask any portal: the Search facility is used more

than any other.  Many portals lose at least 70% of

their users immediately they log on  (an informal

avergae).


If this continues sites will not significantly grow

page impressions and will find it harder to satisfy

advertising packages - or at least the volume required

to make a business viable in the long term.


What the portals need is a new revenue stream that is

not dependent upon advertising or access, but perhaps

more importantly they need to examine whether their

relationships with content providers should be

integrated at a corporate level.


What value an eyeball?



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