Ftc-advertising

FTC workshop: Three observations by economists=

---

This is page for rough, contemporaneous notes of today's U.S. Federal Trade Commission workshop: "From Town Crier to Blogggers: How Will journalism Survive the Internet Age," held Dec. 1-2, 2009, in Washington, D.C., at the FTC's 601 New Jersey Avenue offices. Your scribe is Bill Densmore, a fellow at the Donald W. Reynolds Journalism Institute at the Missouri School of Journalism. Of course we've tried to provide accurate quotes and summaries. But the FTC has stenographers recording all of the testimony and that should be your definitive source. The home page for this coverage is http://www.newshare.com/wiki/index.php/ftc

---

This is the final panel on Tuesday: "Online Adveritsing and Consumer Demand Trends"

---

twitter feeed noted: Wall Street math T @paidContent: Thomson: Up To 290 WSJ Reporters Would Be Jobless If Site Had Gone Free http://cnt.to/iKu

---

Joe Lazlo: Interactive Advertising Bureau

Lazo is director of research for IAB. He has three points:

• Importance of news to the Internet -- If it weren't there, there would be a lot less use of the Internet. Akamai has found the biggest web usage peaks -- November 2008 -- the night of the election -- 8.6 million visitors per minute hit online news sites.

• Importance of advertising to Internet economy -- About $24b generated by online advertising in 2008. You get to an impact of about $300 million a year when you track the multiplier effects. The Internet is increasing the supply and diversity of voices.

Pam Horan: President, Online Publishers Association

their members reach about 110 million U.S. online visitors a month -- about two-thirds of online users. Last year, they invested about $500 million online content and advertising, most of it supported by advertising. How is user time spent: The largest time spent is with content. There is a halo effect for advertisers who partner with the right environment.

Jeff Chester, director, Center for Digital Democracy

He's writing a book about global interactive advertising. He supports FTC and Congress investigating seeing that journalism survives and thrives. "There is a market failure," he says. "Investigative reporting in this country is on the endangered species list."

He has two concerns:

• News media has embraced a business model that threatens peoples privacy.

• His potential concern is that interactive advertising will play a major role in shaping news content.

"As advertisers demand more editorial control it will affect the news," says Chester. "We need to look at this now."

There is a desire to have a deep relationship with consumers. That's the behavioral marketing game. When newspapers are studying carefully what we are all doing, when a business model develops that undermines consumer protection, integrity and privacy something is wrong. "The news industry should be in the forefront of calling for rules that protect the interests of the consumer community."

He says the Newspaper Association of America is opposed to opt-in.

"The news media is going to be on the end of the branding proposition." "Make a distinctly. We are protecting your privacy, and your consumers will be able to share more with you."

"When the FTC beings to understand the digital collection strategy that you are now part of there are going to be consequences."

John Meyer, digital media director, WTOP-Federal News Radio

"We've been doomed since television began so it is nice to have newspapers joining our pending Armegeddon."

Who are their top five competitors? One might be radio. There other competitors are not radio. Clients want to sell stuff and they don't care about the advertising platform.

Barbara Bacci Mirque -- Assn. of National Advertisers

Mirque is executive vp of communications and best practices at ANA.

She is pretty clear about the needs of advertisers as to consumer activity on the web: "We want to follow them around in a day . . . and we want to serve them relevant advertising . . . being in those top-notch sites is important as well."

QUESTIONS AND ANSWERS

Chester: The FTC is getting to the bottom of interactive advertising now. "An elaborate system of profiling for targetting and retargetting has emerged online and there is a considerable privacy threat." He says the advertising agency is working to recreate itself. YOu can look at their research or at Microsoft. "They have put it together. There is a very sophisticated advertising that has emerged."

Elizabeth Jax is on FTC staff and now asks questions. If consumers expect free content, how can publishers maximize their revenue.

Mirque: From an advertising perspective "What the model to is, whether it is paid or not, doesn't much matter. We want to reach the right consumer. ... is it relevant to me, is it good content does it give me positive reference to my brand."

DiSanti: What about brands creating their own content webiste?

Mirque: Consumers are looking for information. Procter and Gamble is doing such sites, and they are also doing some of their own print things too. "The consumers are smart, they see through it ... it has to be relevant to the brand. If it is not related or relative to the brand or the consumer, they are not going to pay any attention to it."

Bloxham: The issue of relevance is critical. There is a greater demand for accountability because of the Internet. He has done research about consumers around different aspects of media, including targetted advertising. He says: "Consumers know it is possible, they envision it. Once they get their heads around it, they say well that means I am going to get more relevant advertising."

They don't understand how it happens or about what recourse there might be if that kind of facility were to be abused. "Consumers come down with the view that if their relationship with the medium is in some way abused, they'll walk," adds Bloxham. Protecting the brand integrity is really important.

He notes that business are competing on their "greeness." He says in the future there will be businesses online which will emerge and "perhaps will market their brand on the basis of that respect for the relationship with the consumer."

Horan: Their members have a responsibility to their communities (consumers/user). They worry about that.

Laszlo: Brands can grow very fast online, but they can also lose trust really quickly. "It behooves media companies to be very careful about how they proceed," says Laszlo. "It's very fast to lose it if they abuse that trust."

END OF DAY ONE