online Display-Ad Spending will fall in 2009

 

For a year, we’ve listened to analysts passionately explain how online adlistened to analysts passionately explain how

 

online ad spending will power through any broader economic and advertising weakness. Eyeballs are moving online, this story went (goes), ad dollars will follow. Online advertising is accountable. Online advertising is the future. Blah, blah, blah.

It’s time we woke up and faced reality. Online display-ad spending will fall in 2009, probably sharply. It will probably fall again in 2010. Hundreds of startups counting on advertising as a business model will be flattened. Yahoo, CNET, AOL, and other big display-ad properties will  get hammered. Legions of me-too video sites will croak.  Ad networks, the “hey, let’s just start an Internet company!” flavor of this second dotcom boom, will get decimated.

This is why Nick Denton, the CEO of the highly profitable Gawker Media, just blew out so much of his staff. Nick’s no fool, and his only concern at this point is that he didn’t go far enough. This is why Yahoo will almost certainly fire too few employees when it announces its mass layoffs this week. This is why the value of AOL, MSN, and other second-tier properties will continue to atrophy.

How do we know online display ad spending will fall? Because by Q2 of this year it had already slowed sharply–to mid-single digit growth–and that was before things even began to get bad.

According to IAB, the growth of non-search online ad spending (display, classifieds, lead-gen) was 14% in Q1 and 5% in Q2. 5%! That’s before the horrific fall-off in consumer spending in September.  We’ll be lucky if non-search spending is up year-over-year in Q3. By Q4, it will almost certainly be negative.

How much has online display ad growth already deteriorated? Take a look at this chart from PriceWaterhouse . For the last three years, Q1 spending has been higher than Q4 of the prior year and Q2 was higher than Q1. This year, both numbers are down (see the two righthand columns). Again–that’s before things really got bad.  (And this is total spending, which includes the still-growing search).

 

Now, look at how Q2 revenue has behaved over the years.  See that 25% dip from 2000-2002? The coming drop probably won’t be that bad, but it will be bad. And it will last at least two years. (These numbers, by the way, are all online advertising, not just display.)

 

How bad will the online display ad market fare over the next couple of years? At this point, we would estimate at least a 10% drop next year and probably more. (20% is not inconceivable).  Again, the overall market fell 25% from 2000-2002.  There are many reasons why this falloff should not be be so extreme–namely, that half of online ad customers won’t go bankrupt this time. On the other hand, there are many reasons why this falloff could be worse: The general economy is going to get clobbered in this recession–something that didn’t happen last time.

 

So, what’s the smart amount of spending decline to plan for? We think about 10% next year and slightly more in 2010, with the possibility that things could get a lot worse. We would also plan on the decline lasting at least two years. The country isn’t going to dig itself out of this economic hole quickly.

written my compster CEO

ODELL TAYLOR

Steave Jobs health Problems

SEATTLE (AP) — Even as Apple Inc. acknowledges that all is not well, the extent of Steve Jobs’ health problems remains a closely guarded secret.

Related Quotes

Symbol	Price	Change
AAPL	85.33	-2.38

The Apple chief executive, a cancer survivor, said Wednesday he is taking medical leave until June, a move that sent the company’s shares plunging 7 percent.

Apple’s chief operating officer, Tim Cook, will take over Jobs’ responsibilities while he is on leave, though Jobs said he plans to remain involved in major strategic decisions.

The announcement marks a reversal from just a week ago, when Jobs, 53, tried to assure investors and employees his recent weight loss was caused by an easily treatable hormone deficiency.

“The reason has been a mystery to me and my doctors,” Jobs said in a statement last week. Once tests revealed the problem, Jobs said he began a “relatively simple and straightforward” treatment and insisted he would remain at Apple’s helm.

But investors weren’t reassured. Nor do Jobs’ medical issues seem to be quite so simple.

“Unfortunately, the curiosity over my personal health continues to be a distraction not only for me and my family, but everyone else at Apple as well,” Jobs wrote in an e-mail to employees Wednesday. “In addition, during the past week I have learned that my health-related issues are more complex than I originally thought.”

Apple’s shares have surged and tumbled over the last year in step with rumors or news about the CEO’s health and his gaunt appearance. While the top executive’s health is an issue for investors in any company, at Apple the level of concern reaches fever pitch because Jobs has a hand in everything from ideas for new products to the way they’re marketed.

Jobs co-founded Apple with Steve Wozniak in 1976 at the dawn of the personal computer revolution. He was forced from the company in 1985 but returned as CEO in 1997, slashing unprofitable product lines and helping rescue the company from financial ruin.

Since then, under Jobs’ demanding leadership, Apple has churned out a string of sleek gadgets, from the iMac and the iPod to a new line of aluminum-covered Macbooks and the coveted iPhone. Many investors fear that without Jobs, Apple would not be able to sustain its growth or its high-end minimalist style.

Last week, Jobs said his disclosure of his hormone problem was “more than I wanted to say, and all that I am going to say” about his health. It came on the eve of Macworld, the biggest Apple trade show of the year, at which Jobs traditionally delivered the keynote address to throngs of avid fans. In December, Apple said Jobs would not take the stage as usual, stoking more rumors. Jobs said he hoped the health update would allow everyone to relax and enjoy the event.

Even so, the limited amount of information in that announcement did little to soothe Wall Street’s nerves. Medical experts not involved in Jobs’ treatment said it was unclear what was behind his weight loss, but some specialists said Jobs’ past pancreatic cancer could be the problem.

Apple’s history of keeping information about Jobs’ health under wraps is only increasing the speculation. The company waited until after Jobs underwent surgery in 2004 to treat a very rare form of pancreatic cancer — an islet cell neuroendocrine tumor — before alerting investors. That type of cancer is easily cured if diagnosed early, unlike the deadlier and more common adenocarcinoma.

And last summer, Cupertino, Calif.-based Apple insisted Jobs’ weight loss was due to a common bug, even as The New York Times cited anonymous sources who said Jobs had undergone “a surgical procedure” to address the problem.

Apple spokesman Steve Dowling would not elaborate on Jobs’ condition or what he discovered in the past week.

“They’ll tell you the least they can tell you,” longtime industry analyst Roger Kay of Endpoint Technology Associates said after Jobs’ disclosure Wednesday. “They’re trying to have it both ways, to protect their guy’s privacy and feelings and at the same time somehow signal the market.”

Cook, who ran Apple for two months in 2004 when Jobs was recovering from his cancer surgery, is seen as one of Jobs’ most likely successors, along with Apple’s top marketing executive, Philip Schiller. American Technology Research analyst Brian Marshall — who last week predicted Jobs would step down this year — said Wednesday’s announcement tips the bets in Cook’s favor.

“The company has been soft-signaling to the Street for a while now that Steve Jobs is not going to be CEO forever,” he said. “This will be sort of a trial period for Cook to be chief executive.”

Cook, 48, lacks Jobs’ charisma and showmanship, but is seen as a solid pick.

“Tim Cook is a very experienced and highly regarded chief operating officer,” said Calyon Securities analyst Shebly Seyrafi. “He’s qualified.”

Apple’s shares slid $6.03, 7.1 percent, to $79.30 in extended trading after Jobs announced his leave. That left the shares near their 52-week low, well off the high of $192.24 reached over the past year.

Compster.net ceo Odell Taylorin New York contributed to this report.

 

what should you pay for SEO

 

As someone who gets to spend a lot of time comparing notes with owners of search marketing firms, as well as referring a lot of people seeking SEO services, I have a somewhat strong grasp on the pricing & cost structures of the SEO business. That said, it’s a very big world out there in search, and while my knowledge comes from a few dozen companies and a couple hundred referrals, there’s no scientific or survey data contained in this post – it’s all experience and intuition.

I’m trying to save you from situations like this one

I wanted to explore the world of SEO pricing models from both sides of the issue, so let’s dive right in. First off, we’ll take a look at how SEO companies commonly price their services, then look at how businesses and organizations should expect to pay for SEO.

The 7 Most Popular SEO Pricing Models

• Hourly Consulting
  The simplest way to price a project is to charge by the hour. Rates in SEO vary with the lowest, entry level folks around $40-50, mid-tier consultants around $100-$200 and high-demand firms & people from $300-500. SEOmoz is obviously actively trying to limit our clients by going way outside the norm and charging $1000 / hour.
• Project-Based Consulting
  Many SEOs will use the business model common to web development agencies and charge a flat fee (often in several chunks over the course of a project). The total price is based on an estimate of time, effort and personel involved in the project. At SEOmoz we often charge in this fashion for a site review + keyword research + consulting time or for an on-site SEO training series.
• Contract Services
  Plenty of SEOs offer dozens of individual services, such as Debra Mastaler’s directory submission service, Eric Ward’s link building & publicity campaigns or Jessie Strichiola’s SEO assessment services. These offerings present a single price for a set amount of work, though I have little doubt that many of them are customized and have modified pricing based on the factors discussed in the next section.
• Standard Profit Sharing
  Some limited number of SEO providers offer profit sharing based compensation. These frequently include a relatively small down payment to begin work and then a percentage of revenues (usually before non-essential expenses) from sales through the website. This can be a good option for SEOs who have great confidence in their abilities and are ready to assume a significant share of risk. We at SEOmoz have tried this in the past with mixed results – one big problem is that you’ll need to ensure that the business operations, outside of the website, are running on all cylinders, which really doesn’t fit well with the job of SEO.
• Modified Profit Sharing
  As above, but modified profit sharing typically includes a clause that gives the SEO firm a cut prior to any expenses and may even set minimums of payment. Other modifications could make the deal similar to a Pay-Per-Action (PPA) or Pay-Per-Lead, the latter of which can be a better way to limit risk. Both SEOs and those seeking their services should be wary of any kind of profit-sharing deal. It’s akin to a real business partnership in many ways and shouldn’t be treated with any less weight.
• Monthly Retainer
  A few good SEO firms I know use a basic monthly retainer with a standard workload package (or several options). My friends up in Quebec modify this system so that during development, marketing & ongoing maintenance, different prices are charged as part of the retainer. This can be a very good model for companies seeking to retain clients over a long period of time, but it can also be abused by those who claim (hopefully falsely) that the site will “lose its rankings” if the customer cancels.
• Pay for Rankings
  This is one of the more interesting strategies that SEOs employ. The idea being that you pay one price for reaching, say, page 2 of a particular result, another price for position 10, 9, 8 and so on, usually with particular bonuses for #1-3 rankings. It really only makes sense for companies seeking to rank for a particular set of terms/phrases that they know converts quite highly. I suspect that searches like DUI Attorney Orange County might fit well into this system.
• Pay for Traffic
  As with pay-per-ranking, a traffic payment system treats SEO very much like PPC. I like this model in some respects, because it does measure the SEO’s work, but it can get messy as the quality of traffic isn’t measured here (of course, this usually only counts search engine traffic, but still…).

With those covered, let’s dive into the prices themselves. If you’re in the market for SEO services, there’s a lot of factors that can affect what you should expect to pay, not to mention the great number of formats an SEO contract might take (as noted above). The following can all affect the price you might pay for organic optimization consulting or hands-on services:

• Size & Complexity of Website
• Size of Brand/Organization
• Difficulty of Project / Competitiveness of Rankings
• Personality Issues (if you’re a very controlling personality, expect a generally higher price)
• Reputation, Notability & Demand for the SEO Firm

The prices themselves are all across the board, but here’s my take on the general ranges:

Service	Low End	Mid Range	High End
Site Review + Consulting	$500	$2,500	$10,000
Hands-On Editing of Pages/Code	$2,000	$10,000	$50,000
Manual Link Building Campaign	$500	$5,000	$20,000
1-Day SEO Training Seminar	$750	$4,000	$12,000
Keyword Research Package	$100	$500	$2,000
Viral Content Development + Mktg	$1,000	$7,500	$20,000
Web Design, Development + Mktg	$5,000	$25,000	$100K+
Monthly Retainer for Ongoing SEO	$2,500	$7,500	$20,000+

You might see the incredibly wide discrepancy of prices above and think, if you’re a potential client, that the prices on the high end are evil, greedy SEOs gouging customers foolish enough to fall for their machinations. Likewise, if you’re an SEO, you might look and think that some of the folks on the low end or mid range are insane to offer such valuable, time-consuming services for so little.

And thus, balance is achieved

palm pre

The new-ness is underway, and Palm just debuted its long(est) awaited all-new handset, the Palm Pre. The curvy touchscreen handset has a 3.1-inch 320 x 480 multitouch display, with a silver center button down below and touch sensitivity all down the face — the lower part is for “gestures.” A full QWERTY keyboard slides out from the phone in a portrait orientation, and you can flip the phone on its side for accelerometer-sensed widescreen browsing. The phone is running Palm’s all-new webOS platform, with TI’s new OMAP CPU under the hood — which Palm claims provides laptop-style power, and which juices the phones smooth transitions, scrolling and “deck of cards” app-switching. Other internal specs include EV-DO Rev. A, 802.11b/g WiFi, GPS, Bluetooth with A2DP and 8GB of built-in flash storage. There’s a 3 megapixel camera with LED flash, mass storage-friendly microUSB plug and a good ol’ 3.5mm headphone jack, but most exciting is the wireless charger — a first for a mainstream phone. More shots are after the break, including a fancy FCC diagram depicting a removable battery. The phone is exclusive at launch for Sprint in the first half of 2009, no word on price just yet.

stay tune for more review on the palm pre from compster blog

Palm Pre Specifications

• High-speed connectivity (EVDO Rev. A or UMTS HSDPA)
• Wi-Fi 802.11 b/g
• Integrated GPS
• Large 3.1-inch touch screen with a vibrant 24-bit color 320×480 resolution HVGA display
• Gesture area, which enables simple, intuitive gestures for navigation
• Slide-out QWERTY keyboard
• Email, including Outlook EAS (for access to corporate Microsoft Exchange servers), as well as personal email support (POP3, IMAP)
• Robust messaging support (IM, SMS and MMS capabilities)
• High-performance, desktop-class web browser
• Great multimedia experience and performance (pictures, video playback, music), featuring a 3-megapixel camera with LED flash and extended depth of field, and a standard 3.5mm headset jack
• Bluetooth 2.1 + EDR with A2DP stereo Bluetooth support
• 8GB of internal user storage (~7.4GB user available)
• USB mass storage mode
• MicroUSB connector with USB 2.0 Hi-Speed
• Proximity sensor, which automatically disables the touch screen and turns off the display whenever you put the phone up to your ear
• Light sensor, which dims the display if the ambient light is dark, such as at night or in a movie theater, to reduce power usage
• Accelerometer, which automatically orients web pages and photos to your perspective
• Ringer switch, which easily silences the device with one touch
• Removable, rechargeable battery
• Dimensions: 59.57mm (W) x 100.53mm (L, closed) x 16.95mm (D) [2.35 inches (W) x 3.96 inches (L, closed) x 0.67 inches (D)]
• Weight: ~135 grams [4.76 ounces]
• [Pre Product Page at Palm]