Yesterday's Interactive Week online quoted AOL SVP Advertising saying that the value of AOL's chat-related advertising inventory is $500m annually. Today's AOL press release says chat affords 360m impressions per month. That would be $0.1157 per impression. Most of AOL's current inventory of impressions is $0.01-0.02, about average for high volume WWW ads.
At the risk of replying without having reached the most current messages :) I, too was puzzled by this figure. AOL's public statements about the chat ads indicate that they think maybe $15-25 million is a realistic number from this source for 1997.
The $500 million super-hype number is being floated by Lehman Bros. It is the maximum theoretical number plausible if AOL was able to put ads in every possible nook and cranny of AOL (including Instant Messages) and was able to sell all of the inventory at the best possible price.
Lehman Bros does know that AOL has a pending class action suit over exaggerated claims, don't they? Or don't they care?
Here is a copy of my article today in news:alt.aol-sucks
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With all the emphasis on advertisting in chat rooms - will it still be a
violation of TOS for *members* to advertise in a chat room? :)
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All the conventional news sources are drooling over AOL's plan to put
advertising in the chat rooms. A sample of the stories:
cnnfn.com
New Details:
- The ads will change once per minute
- AOL Users spent 125 million hours online in January
- Pittman say that is 32 minutes/day per member
Ooops - Mr. Pittman just disclosed average membership for January
(125/31) * (60/32) = 7,560,483 (+/-)
>http://www.pcweek.com/news/0303/04eaol.html
- story quotes the $500/million year in revenue figure
- 600,000 hrs/day are spent on Chat
(combined with 125 million/month total - Chat = 14.8% of usage)
(This seems low to me - 25% is what I've read previously)
- up to 14,000 chat rooms at once
(However, the ads will not appear in member rooms)
nytsyn.com
- 1 million hrs/day in chat - sounds correct (25%)
zdnet.com
washingtonpost.com
prnewswire.com
- 70% of AOL members chat regularly
- AOL will generate 360 Million "impressions" per month
Working backwards :)
30 million chat hours/month = 12 impressions/chat hour
Therefore 1/5th of chat is in public rooms
(or AOL is being conservative)
nytimes.com
- Ads may generate $15-25 Million (not $500 million !!!)
- The source of the $500 million figure is Lehman Bros (duh!)
>If ads ran on all interactive services on America Online,
>including chat, electronic mail, special interest bulletin
>boards and its "instant messages" subscriber messaging
>system, America Online could book as much as $500
>million in advertising revenues, he said.
("He" = Brian Oakes, Analyst at Lehman Bros)
- When Rosie O'Donnell was online, 16,000 people joined the chat
Art Stone
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Get the "scoop" on using AOL's secret access numbers.
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