Arabian Business Web Index - June 2003 Report

Yahoo spends $1.63 billion to acquire Overture and regional dot-coms report that online advertising is on the up

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By  David Ingham Published  August 3, 2003

Life returns to the dot-com market|~||~||~|Click here to view the Arabian Business Web Index for June 2003"

Yahoo’s acquisition of Overture indicates that there may be plenty of life left in the internet industry. Yahoo is gobbling up the search and advertising company in a deal valued at $1.63 billion.

“Yahoo now owns all the crucial elements of an end to end search offering,” commented Terry Semel, Yahoo’s chief executive officer. “Consumers will benefit from more relevant messages, and marketers from more effective results.”

The acquisition indicates the increasing importance of the ‘contextual’ advertising market. Overture sells advertising links that accompany search results on sites such as Yahoo and MSN. This type of targeted advertising is seen as more attractive in the long term than ‘one size fits all’ banner, pop-up and interstitial adverts.

Overture forecasts that its 2003 revenues will be US $1 billion in a market worth US $2 billion. Meta Group predicts that the online contextual advertising market will be worth US $5 billion by 2006. One twist in the Yahoo-Overture story is that MSN, Yahoo’s portal rival, is a large customer of Overture. Microsoft recently extended an agreement to run Overture’s paid links on its sites, but the deal is bound to be reassessed.

Moves currently being undertaken by AME Info reflect the growing importance of advertising that is more directly relevant to the individual user. The business portal’s first step in that direction is the introduction of ‘my AME Info.’

As reported last month, the service allows recipients of AME Info’s weekly newsletter to specify which news they want to receive. Over time, AME Info will be able to build up profiles of its individual users, which will give it a better story to take to advertisers.

“Distributing commercial messages, if related to something you asked for, makes sense,” says Klaus Lovgreen, CEO of AME Info. “The target is to move away from e-mail unless it’s something that you really need and really want. General newsletters will suffer a death over time.”

None of this is to say, of course, that conventional advertising such as pop-ups, banners and interstitials is going away. In fact, speak to regional dot-coms and they’ll tell you that online advertising is going through something of an upsurge at the moment. “I would say online ad revenues in the Middle East have probably tripled far this year,” observes Hani Jabsheh, director, Al Bawaba Network. “From our perspective, they’ve more than tripled.”

Although he won’t give out dollar figures to illustrate his growth, he is confident that the region’s online industry may have turned the corner. “There’s a lot more awareness; people are convinced that we do have critical mass now on the internet. 2003 has been the turnaround year,” says Jabsheh.

“It’s also clear now who are going to be the survivors and who is slowly exiting the market. Any web site with a healthy cash position will do very well next year.”

From around 5% last year, advertising now makes up around 25% of Al Bawaba’s revenue and Jabsheh expects it to account for around 50% of turnover next year. AME Info echoes those positive sentiments about the online advertising market, although without giving out dollar figures. “It’s definitely growing,” says Lovgreen. “I think it’s going through a particular upsurge in the Middle East.”

Click here to view the Arabian Business Web Index for June 2003"

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||**|||~||~||~|Ranking in category by page views: Web sites are ranked according to the total number of page views reported in the sample period.

URL: Internet address of the Web site.

Site description: Web site owners have submitted their own descriptions. These have been edited by Arabian Business.com due to space constraints.

Site category: Categories have been formed by Arabian Business.com for the purpose of comparing Web sites in a like-with-like environment.

Total number of visits in period: The cummulative total of visits to a site in the specified period. A person visiting more than once in the sample period will be counted every time that person visits. Visitors to a site for a prolonged period, i.e. opens a Web site and leaves that site open on his machine all day, can count as several visitor sessions in that day. Web tracking software can effectively call a visitor session closed if it remains inactive for a predefined period.

Average duration of visitor session in period: The time taken between entering a site and leaving a site.

No. of new visitors in period: A count of visitors who have not at any time been logged by the Web tracking software.

No. of unique visitors per month: Unique visitors are counted using the visitor's IP address, domain name, or cookie.

No. of page impressions in period: A count of hits to pages defined as documents or forms by the Web tracking software. In most, but not all cases, a cick to a new page within a Web site will count as a single additional page impression. The supporting graphics on pages are not counted.

Sample period: The dates during which the log data was generated.

Verified by: Note of whether the visitor data has been checked by Arabian Business.com or whether the site owner has supplied data without independent verification.

Click here to view the Arabian Business Web Index for June 2003" ||**||

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