July 27, 2006 4:00 AM PDT

Google rides the radio waves

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If you're trying to catch on in radio, Motown is probably a good place to start.

Google-powered ads, which have become a mainstay on Web sites, are now being played on at least one radio station in Detroit. And like so many other Motor City radio products, it won't be long before they go global. Google Chief Executive Eric Schmidt said in a conference call with analysts last week that the search giant plans to make its radio-ad business generally available within three months.

"We are in the process of introducing AdSense for radio, which is essentially the integration of the DMarc console and management tools into our advertising system. There are a number of very interesting deals being negotiated," Schmidt said. It's a typically ambitious effort for Google, which got into the radio business in January with its $102 million acquisition of DMarc Broadcasting, a company that had an automated radio advertising system.

"It gives advertisers enormous capabilities at the touch of a finger, capabilities that have never existed before for advertisers."
--John Fullam
Greater Media Philadelphia

If Google radio ads actually catch on, they could have significant implications for the way radio ads are sold. That could be a good thing for an industry that saw April revenues, for example, drop 5 percent from a year ago, according to the Radio Advertising Bureau trade association.

"I think DMarc has an opportunity for us to connect with advertisers we don't normally interact with," said John Fullam, vice president and market manager for Greater Media Philadelphia who said this week that Google ads were already being tested on Greater Media radio stations in Detroit. "It's big for radio."

So why the excitement? DMarc automates the process of buying ads, placing them in time slots and tracking them, which is usually done by ad agencies over the phone, experts said. Automation could lead to efficiency, and that means lower prices for advertisers while bringing in more sales for the radio stations.

The Google-DMarc system would be a big change from the current ad-buying system, where ad salespeople establish personal relationships with radio stations, Fullam said. Advertisers could better quantify how well an ad campaign is doing and modify the ads quickly depending on the response rate from listeners, he said.

"It gives advertisers enormous capabilities at the touch of a finger, capabilities that have never existed before for advertisers," Fullam said. "Creating a whole new advertising base and delivering more measurable results is extremely encouraging for advertisers and radio."

Mixed results
More than half of the advertisers DMarc has talked to have never been called on by a radio rep, he said. "That's untapped potential," Fullam added. In addition, Google's DMarc can help radio stations sell ads for airtime that would otherwise go wasted, known as unsold or "remnant" inventory.

Of course, there's no guarantee Google's radio project will take off. Indeed, skeptics say Google's print advertising project has so far had mixed results and, for all its interesting ideas, the Silicon Valley company is still almost entirely dependent on online advertising. While that's not much of a problem right now--revenue in Google's most recent quarter was $2.5 billion, nearly double what it was a year ago--it's clear the search company's executives are looking long and hard for ways to diversify the way the money comes in.

There are questions about the value Google will be able to provide to more-sophisticated advertisers as opposed to what they get with traditional ad buyers, said Maribeth Papuga, senior vice president of local broadcast for media services firm MediaVest.

See more CNET content tagged:
DMarc Broadcasting, advertiser, radio, radio station, Detroit

10 comments

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Work For Google?
Do you want to work for google?

Can you answer these questions?

<a class="jive-link-external" href="http://otherthingsnow.blogspot.com/2005/10/google-interview-questions-they-are.html" target="_newWindow">http://otherthingsnow.blogspot.com/2005/10/google-interview-questions-they-are.html</a>
Posted by SqlserverCode (165 comments )
Reply Link Flag
Google Radio Auctions
Google radio ads: who dreams this stuff up?

Will stations still want to OK all the copy and approve all the pricing?

A lot of new business for less effort or a little net gain with the pain?
Posted by optimad (1 comment )
Reply Link Flag
Google Sucks as Much as CNET
Google has been down for 2 days. Their death spiral
<a class="jive-link-external" href="http://www.techknowcafe.com/content/view/603/43/" target="_newWindow">http://www.techknowcafe.com/content/view/603/43/</a>
is occurring faster than CNET's.
Posted by (156 comments )
Reply Link Flag
Oh no, not this idiot again
Seems like every post of his is about how much something sucks and always including CNET in his opinion of suckiness... while incidently posting a link to some tech news site that only wishes to have the clout and traffic news.com has.

He's an attention seeking troll trying to get you to visit his site.

Grow up dude, go outside and make some real life friends!
Posted by SeizeCTRL (1333 comments )
Link Flag
dMarc / Scott Studios
dMarc prior to the google deal, bought Scott Studios. I work for a radio / tv broadcasting company and all of our radio stations are running SS32 by Scotts Studios which almost eliminates the need for a in studio DJ. We've had jocks go on vacation, but voice tracked in SS32 with the play list and they sounded live. Since radio makes money off selling ads, what is the incentive and the cut offered by google to individual stations? Why would we want to go with cheap ads sold in bulk pushed into timeslots sold by dmarc when we could sell those same timeslots to local businesses willing to pay more and know they will be reaching area listeners.

Great idea in theory, but I'm not sold on it yet.
Posted by SeizeCTRL (1333 comments )
Reply Link Flag
unsold inventory
The draw here, and maybe the arcticle didn't fully explain how this
works, is that dMarc only replaces avails in the traffic log.

I am sure your station, just like every station but a handful in the
country, has a few unsold avails. Well, you replace these unsold
avails with dMarc spots. It may not be your asking price, but ask
any GM, money is money.
Posted by chrisbuckland (3 comments )
Link Flag
 

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