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TWST: What is NetRatings?
Mr. Sloan: NetRatings is a global leader in Internet media and market
research. Essentially, we provide answers to the questions that
companies have in terms of sales and marketing strategy on the Internet.
So we are providing solutions and answers to questions as companies look
to design their strategies for using the Internet as a sales and
marketing vehicle. NetRatings started back in the late 1990s. It was a
Silicon Valley technology company with great technology and engineering
assets. We formed a partnership with Nielsen Media Research, the largest
provider of television audience measurement and advertising information
in the world, to create the Nielsen//NetRatings brand, basically the
'Nielsen of the Internet.' So we were creating a similar offering on the
Internet in terms of the audience and advertising measurement
information that Nielsen provides for television. That partnership was
formed back in 1998 and Nielsen took a large ownership position in
NetRatings. As a result, VNU, Nielsen's parent company, today owns
approximately 62% of NetRatings and the balance is traded on the NASDAQ
Global Market. The initial product offering we developed was NetView,
our Internet Audience Measurement service. We recruit high quality
panels of Internet users to install a proprietary piece of tracking
software on their computers. In addition, we collect their basic
demographic information (age, gender, income level, education and so
forth). The service delivers audience estimates and demographic profiles
for Internet publishers ' the Yahoos! AOLs and MSNs of the world When
the Internet bubble burst in the 2000-2001 timeframe, NetRatings was
very well positioned because we were very well capitalized. So while
some of our competitors weren't as fortunate, we were able to weather
the storm of the industry's downturn. We took a very aggressive decision
in early 2002 and started on an acquisition path for some of terrific
Internet media measurement products. We acquired AdRelevance, an
advertising expenditure measurement product, and @Plan, an audience
measurement product that delivers in-depth lifestyle and demographic
information. In addition, we continued on somewhat of an acquisition
binge where we purchased a couple of audience measurement products
companies outside the US. We purchased the balance of our international
joint venture called ACNielsen eRatings, which was essentially the
similar NetView offering, but in many countries around the world. We
also continued to use our strong capital position and developed market
research products organically. We built a product that we refer to as a
MegaPanel offering, which was a much larger panel that was built through
online recruitment that was designed more for market research. So while
our media research products are designed for buyers and sellers of
Internet advertising, market research products are designed for
companies seeking information related to transactions, commerce and
consumer attitudes. We began to build MegaPanel in 2003 and launched in
2004, and currently offer vertical offerings for Search, Commerce,
Travel, Local Market and Finance. In late 2003, we acquired RedSheriff,
a Web analytics company based out of Australia, and re-branded the
product to Nielsen//NetRatings. SiteCensus measures audiences'
demographic information details from the client site. This acquisition
rounded out our current product portfolio and provided us with a
tremendous opportunity to collect data points in many different ways to
help companies doing business on the Internet. One of the things that we
have seen over the last year or so is something that we all have been
waiting a long time for, and that's convergence between television and
the Internet. The largest television networks today are now streaming
their television content on the Internet and are demanding audience
information related to that content. Networks are saying, 'As we stream
this content online, we need to have access to audience ratings and
demographic data so we can sell advertising.' A prime example was CBS
with its March Madness programming. CBS ran games over the Internet and
had huge audience numbers. I think a lot of the networks saw that and
followed quickly by launching many of their products onto the Internet.
Convergence is very big development for us, and we refer to it as the
digital audio and video content area. We are working in partnership with
Nielsen to create different product offerings, as well as working
independently with many of our existing clients and product offerings to
help measure that content and provide demographic information
surrounding that content online. I think that's probably one of the most
significant developments in the industry today, and it presents a very
large opportunity for us over time.
Tickers included in this excerpt: NTRT
For more information call (212) 952 7433. The
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