The Higher Value of Eyeballs

THE HIGHER VALUE OF EYEBALLS
[SOURCE: New York Times, AUTHOR: Louise Story]
Underscoring all the debates about online privacy, behavioral targeting and Internet advertising is a hard, cold reality: content costs money. Media companies, at some point soon, have to figure out how to recoup their content production costs through online advertising. The problem is not that people are spending more time online than with physical newspapers or magazines. The real problem is that the giant pie of audience has been split into smaller and smaller pieces as more television channels and niche publications compete for attention. The media industry calls it fragmentation, but in simple terms, it means smaller audiences for publications and television programs that used to be watched by large chunks of society. As mass advertising dies, there is more pressure for media companies to develop audiences with more specific interests and characteristics. From an economic standpoint, the drop in the total number of eyeballs means the eyeballs that remain must become more lucrative. Media companies are also using targeting, often called behavioral targeting, to provide more valuable eyeballs. Behavioral targeting tracks the sites people visit to deliver them more relevant ads later on.
http://www.nytimes.com/2007/11/05/technology/05bits.html?ref=todayspaper
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