Zynga Nets $150MM Investment, Is Turning Japanese

Drawing further attention to the white-hot social gaming sector, Zynga on Thursday said it raised $150 million from Japanese wireless carrier Softbank. The partners also announced plans to develop and distribute social games in Japan via a new Zynga Japan joint venture.  Along with the obvious opportunities to expand its user-base, the Asian enterprise will allow Zynga to “gain insights from the Japanese market,” said Mark Pincus, founder and CEO of Zynga.  Based in Tokyo, Zynga Japan will attempt to tap into the country’s renowned passion for gaming and technology, while leveraging Softbank’s mobile and Web technology to produce new social games. “We share the same vision as Zynga in social games and look forward to working together to create a social game powerhouse,” Masayoshi Son, chairman and CEO of Softbank, said in a statement.  San Francisco-based Zynga creates games like “FarmVille” and “Mafia Wars,” which have thrived on social networks like Facebook, as well as among early mobile app adopters.

Read More: MediaPost

App Store Not Named iTunes Heads To a Billion Downloads

Today, GetJar, a San Mateo, Calif.-based company, announced it is delivering over 3 million downloads a day to more than 2,000 different phone models. Adding support for Google Android devices last year has helped boost the daily downloads, as Android is already the second-most-used platform for GetJar customers. The company says it has seen tremendous growth over the past year, with downloads up 300 percent from the prior year.  GetJar bills itself as the “second largest app store,” boasting over 73,000 software titles. With roughly 225,000 apps, Apple’s iTunes App Store is the largest. But Apple’s store only supports a single platform in iOS4 devices, so GetJar goes after the remaining market, which is magnitudes larger. GetJar is a centralized software store for Android, BlackBerry, Symbian, Windows Mobile and Java devices. With such a wide variety of supported platforms, the company is on pace to deliver 1.1 billion mobile applications over the next year.  GetJar’s app store is intelligent enough to determine what device a handset owner has, and only shows applications compatible with that device. And as a central repository, GetJar gains useful metrics and data on what consumers are downloading, which in turn can help developers. Today, for example, the company says that customers in India are downloading more productivity apps than consumers in Europe or North America. Armed with that type of information and support for multiple platforms, developers can target different types of software in regions where consumers are likely to buy it and thus earn per-download revenues.

Read More: Gigaom

Brands on Sidelines as Disney, Google and MTV Charge Into Social Games

There’s a land grab in social gaming, but at this point, it doesn’t look like there’s much room for advertisers.   On Tuesday, Disney acquired top-three developer Playdom for $563 million plus $200 million in incentives. Google, meanwhile, is reportedly in talks with Playdom, Electronic Arts and Zynga in a social-gaming push. And MTV Networks this month acquired social-game developer Social Express and plans to launch games based on its TV shows later this year.  With the draw of their established storylines and characters in social games — not to mention well-oiled marketing machines — established media companies hope they can use casual gaming to grow and interact with their already massive audiences.  “When media companies integrate their brands, it’s going to be easier for people to get into the games because they are familiar and that will expand the market,” said Justin Smith, founder of social-game research firm Inside Network.

Johnson & Johnson is Holding a Roster Review of its Estimated $3bn Media Business.

On Tuesday, Disney acquired top-three developer Playdom for $563 million plus $200 million in incentives. Google, meanwhile, is reportedly in talks with Playdom, Electronic Arts and Zynga in a social-gaming push. And MTV Networks this month acquired social-game developer Social Express and plans to launch games based on its TV shows later this year.  With the draw of their established storylines and characters in social games — not to mention well-oiled marketing machines — established media companies hope they can use casual gaming to grow and interact with their already massive audiences.  “When media companies integrate their brands, it’s going to be easier for people to get into the games because they are familiar and that will expand the market,” said Justin Smith, founder of social-game research firm Inside Network.

Read More: AdAge

Mixed Ad Message From Newspapers

Online advertising has turned into a good-news story for newspapers. Will it have legs?   Several newspaper publishers have reported solid growth in digital advertising revenue for the second quarter in recent days, helping offset continuing declines in print advertising. The New York Times, for instance, reported 21% growth in digital-ad revenue against a 6% drop in print advertising, keeping total advertising “roughly flat” with the year-earlier quarter. Digital now accounts for 26% of its total ad revenue, up from 22%.  But that is mainly because print revenue has shrunk so much, rather than because digital has got so big. At the Times Co., print-ad revenue for the news group fell $15 million, to $232 million, while its digital-ad revenue rose $8.3 million. Growth at the About.com portal also boosted digital.

Industrywide, print-ad revenue fell by nearly half between 2000 and 2009, a loss of about $24 billion. But newspapers’ online revenue totaled only $2.7 billion last year.  That includes online classifieds, a segment that has been under pressure from free alternatives. Display advertising, including video, is where newspapers have the most opportunity. The market still is relatively small, just $8 billion in U.S. revenue last year, or 35% of total Internet revenue, according to the Interactive Advertising Bureau. And newspapers are competing for display dollars with major portals like Yahoo and Google as well as lots of smaller sites.  One bright spot for newspapers is that their sites draw higher ad rates than most other categories, at least as measured by cost per thousand impressions, or CPMs, according to comScore. Precise CPM numbers are hard to come by, but these estimates offer some indication of the differences between sites.

Newspaper sites’ CPMs in April were $6.99, while the rate for portals was $2.60 and 56 cents for social-networking sites, comScore estimates. Newspapers’ traffic isn’t high enough for those rates to translate into huge dollars: Newspapers drew only 8.5 billion impressions in April, translating into a revenue estimate of $59.4 million for the month. Impressions were 69.7 billion for portals and 98 billion for social-networking sites, comScore reported, for revenue of $181 million and $54.7 million, respectively.  Professionally produced content helps make newspaper sites, at least those of major titles like the New York Times, attractive outlets for advertisers. Many marketers are reluctant to have their ads appear on heavily trafficked social-networking sites because of the uncertainty of the kind of content that appears on those sites.  Longer term, video and mobile advertising also offer hope. For now, though, investors need to be wary in assuming that newspapers’ digital potential can outweigh the challenges in their legacy business.

Read More: WSJ (Entire Article Here)

Network Margins and Advertiser ROI

Ad networks play a critical role in delivering monumentally effective advertising.  Every day, I see smart and successful ad networks like Brand.net, Collective, and Media6Degrees delivering outstanding results with innovative technologies, quality service, and deep analysis that their clients deserve. (Disclosure: These are all clients of my company.) Ad networks were the early adopters of real-time bidding (a game-changer in display ad buying) and have developed cool concepts such as social targeting (e.g., if I buy an iPhone, marketers can rightfully assume my “friends” will too). Significantly, ad networks are the biggest users of the ad exchanges and their revolutionary auction-based marketplaces.  Despite these innovative approaches, unfortunately, ad networks still have gotten a bad rap because many in our industry have been focusing on the wrong things.  Much of the negative perception about ad networks stems from assumptions that they make high margins. Why is this bad? Think about grocery shopping. Did Whole Foods grow the squash and bananas behind the store in its own little urban farm? Of course not – it buys from rural farmers and charges margins on those products. I don’t have a relationship with the farmer in Honduras and don’t really have time to fly there for my daily banana, so I don’t worry about the margin Whole Foods has earned. It should be a pleasure to help good vendors make the margins they need to reinvest in their business.

Read More: ClickZ

An Amazon-Facebook Alliance to Make Shopping More Social

On Tuesday, Amazon.com took a step toward making the shopping experience on its Web site more social.  For many people, shopping is as much about socializing as it is about buying something — a chance to run into neighbors at the farmers’ market or spend time with a friend at the mall. And people who go shopping with a friend inevitably ask advice before buying. But it’s hard to do that when online shopping.  Now, Amazon shoppers who connect their Amazon and Facebook accounts transport their Facebook friends to Amazon — and can get recommendations from those friends on what to buy.  Amazon was an early leader in offering recommendations based on previous purchases and product searches, and in posting customer reviews on the site. But it has been slow to incorporate social features, while start-ups like Go Try It On, Polyvore and Swipely have been experimenting with ways to make online shopping more interactive.  Amazon’s new feature is the company’s small first step toward tapping into the world of social shopping.

Read More: Blogs.NYTimes.com

Disney Buys Playdom For Up To $763.2 Million

Walt Disney (NYSE: DIS) is making a big move into social games, with the purchase of fast-growing social game developer Playdom for up to $763.2 million. The deal includes a “total consideration” of $563.2 million, in addition to a performance-linked earn-out of up to $200 million.  In a release, which is included in full after the jump, Disney says that by buying Playdom it “will strengthen its already-robust digital gaming portfolio, acquire a first-rate management team and provide consumers new ways to interact with the company on popular social networks like Facebook and MySpace.” The company hints that it will now be bringing its “characters, stories and brands” to games on social networks.  By acquiring Playdom, Disney will also be getting an existing portfolio of popular social games, which includes Mobsters, the top title on MySpace (NSDQ: NWS). Over the last year, Playdom has been rapidly expanding its lineup of titles through the acquisition of eight gaming startups. It now ranks as the top social game developer on MySpace and the fourth largest on Facebook. The company, which is profitable, said late last year that its sales were near an annual run rate of $50 million.

Read More: PaidContent.org

Download the Ad Networks vs. Ad Exchanges Whitepaper

This whitepaper compares ad networks and ad exchanges from the perspective of web publishers looking to maximize their advertising revenue. It outlines the fundamentally different ways in which ad networks and ad exchanges sell publisher inventory, highlights the benefits of ad exchanges over ad networks in terms of driving up publisher revenue, and explains why an ad exchange is an essential component of every publishers’ monetization strategy.

Read More: OpenX.org