Monday, October 24, 2005

Someone's an idiot

Another fawning, obsequious puff piece in a News Corp. paper about News Corp. today. That's not so remarkable, and Fairfax does it a lot too, as well as any other Old Media company who is desperately trying to remain globally relevant. What is remarkable is what those two companies charge advertisers to put ads on their Australian networks: Fairfax Digital rate card and News Interactive rate card (in A$ - conversion is about A$1 = US$0.75).

I read complaints over on WebmasterWorld's AdWords forum all the time about how terrible an impost US$0.10 cost-per-click is as a price in Google's advertising network. Fairfax charges a minimum A$11 CPM (cost-per-thousand-impressions). For the same price that will get you a clickthrough from an interested potential buyer on Google's ads (with unlimited CPM until that happens), Fairfax sells you 12 impressions from people who most likely ignored your ad entirely. And that's Fairfax's minimum price! They charge as high as A$126.50 CPM for placements in Fairfax Business Media - meaning and their various niche business magazines like BRW, CFO, MIS etc. Then we come to News, whose minimum CPC on their media sites is A$33 (five impressions equivalent to a Google clickthrough) to a maximum of A$88.

A caveat should be stated to go along with these figures. Rate cards are rarely adhered to in actual sales negotiations, except with government departments, so the average prices that end up being agreed to are probably significantly less.

Nevertheless: someone's an idiot. I'm prepared to accept that multiple candidates for idiocy exist. Who's more of an idiot? Is it Google, whose humungous Q3 financials have beaten the most bullish Wall Street forecasts, or Fairfax who is allegedly facing A$100 million in cost cuts? Is the media buyers for paying over the odds? Is it Time/Warner for buying AOL but now fending off vultures, including News Corp., whose owner is wringing his hands about which New Media company to buy to keep himself youthfully brunette (but trying not to pull a Time/Warner)?

All I know is, I wonder how much Fairfax and News Corp. do actually end up charging on average.


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