Fox Interactive Media now has the tools in place to start relying less on third-party ad placement systems and more on what they can sell based on the data they have, like all of those MySpace profiles just hanging around the social networking site.
It’s a capitalist truism, and the fuel of many a dream, that ownership profits the entrepreneur far more than letting someone else make all the money and cut you in for a small slice. Some might call it playing with house money, and that’s a concept Rupert Murdoch likely understands as well as anyone.
Now that Fox has picked up Strategic Data Corp, they will have an in-house system that will let them print advertising money, instead of taking a piece of the action from another firm’s advertising placed on MySpace.
Classified Intelligence said the SDC purchase will take up to 90 days to integrate with Murdoch’s Los Angeles-based Internet fiefdom. Once Fox Interactive Media has SDC’s capabilities running effectively, it will mean the dimming of the lights for some of its third party advertising delivery partners:
FIM will reportedly use SDC to primarily serve up targeted cost-per-action ads. Until now, FIM has used 17 third-party-ad networks, and while it says it will continue those relationships, it admits it will rely on them less as it rolls out SDC products and may not renew some agreements when they expire. All the sites in the Fox Interactive network except FoxSports.com, which is partnered with MSN, will use the SDC system.
Notice they say cost-per-action ads, not cost-per-click.
Classified Intelligence analysts think it’s about time Fox took greater control of its online ad destiny:
Our biggest beef with MySpace is that it fails to target relevant ad content to its nearly 160 million opted-in users who have already told advertisers everything they could possibly need to know to sell effectively to them.
Google’s opinion of the FIM-SDC deal merits consideration. They paid $900 million to Fox to place search and advertising on MySpace. A News Corp executive enthused about this in the Financial Times when the partnership became solidified last year:
