December 2007 Archives

Reuters has just reported that the European Union’s advisory body on data protection intends to scrutinize targeted online advertising and its implications for privacy in 2008. The Facebook Beacon debacle this week has brought to public attention the ramifications of targeted advertising for privacy, and the EU is already taking this to heart.

The EU’s machinations are among the most powerful forces shaping global business, and in particular the online world. To take just a couple of examples, Microsoft has come afoul of the EU on monopoly abuse, and Google’s mooted acquisition of Double Click is being delayed until April while the EU extends its probe. On a far broader canvas, extremely strict EU data protection laws shape how online business is conducted all over the planet.

There is no question that targeted advertising is one of the most fundamental forces shaping the entire media landscape. The greatest power of digital media (which is evolving to eventually cover almost all media, including many forms of TV, much outdoor advertising, and will also encompass newspapers come the advent of e-paper) is that it allows advertising messages to be targeted to the individual. This is not just about showing advertisements to those who will find them relevant, but also about customizing advertising content so that it is more likely to influence the individual viewer.

The December/ January issue of Marketing magazine includes predictions for 2008 from an array of industry commentators, including myself.

One of the quotes they took from me was:

Social media shows no sign of slowing down any time soon, with more advertisers looking likely to jump on the Web 2.0 bandwagon in 2008. According to Dawson, a new trend could see a proliferation of smaller, more targeted social networking sites. “The social network landscape will be highly dynamic, and new specialist social networks are likely to do well,” he says. “Open, independent platforms for storing social network information will become a real force in how people use social networks.”

Dawson also forecasts a challenge for Second Life. “ A major competitor for Second Life will emerge, taking advantage of its technical problems.” He also suggest virtual worlds will be used more frequently in work settings.

Some of the other predictions for 2008 I made include:

“Inevitably the marketing industry will consolidate. In just the same way as happened in the accounting industry several years ago, consolidators will actively acquire smaller operators in an attempt to build large businesses. A few will succeed at this, and more will fail.”

Several media executives have asked me about the convergence of the Internet and TV over the last couple of months. I now have a nice reference point for them about the short-term obstacles and possible solutions, courtesy of Nick Wingfield in an article in the Wall Street Journal titled The Internet. The TV. They have even created a brief video – as below – to provide a quick overview of the topic.

Nick frames the issue as a series of problems with potential solutions:

THE PROBLEM: Too Many Boxes
THE SOLUTION: Blend Boxes