Posted October 19, 2007 9:19 am by with 7 comments

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The UK’s public service broadcasting behemoth, the BBC, has been going through some tough times the last few weeks. However a major announcement has been lost through all the talk of job loss, changes in programming and shifts in budget. Soon all the international visitors to the hugely popular BBC website will be served adverts. With such a huge audience it promises to sound the death knell for struggling portals like Netscape.

Ciaran Norris over at Altogether Digital highlighted the potential problems for the other portals and news sites.

The BBC site apparently attracts over 40 million foreign visitors every year, which is a significant number… certainly enough to seriously disrupt the advertising models of major commercial portals such as AOL & MSN.

He’s right to illustrate the potential risks for other publishers, advertising is just like any other business and issues of supply and demand affect it. It’s not every day of the week that display advertising inventory of this volume finds its way to the market place. And while the number of ad impressions available to buyers might increase it’s unlikely advertisers’ budgets will grow at the same rate. The media planners will likely spread their budget across all sites which means less money for other websites.

Given the trusted product that is BBC news and website, it’s not hard to imagine that as a consequence their adverts will be more trusted leading to greater click through rates and better ROI for advertisers. If this is the case, budgets and media spend will quickly shift to the better performing website.

The UK media seems to be focusing on budget cuts which are part of the Beeb’s restructure, however the changes could have a positive effect for international website visitors. In a similar way to the Daily Telegraph’s recent newsroom changes, there is going to great integration between news team. This means there will be more rich content available on the website following changes.

Topic wise it doesn’t get much more diverse than the BBC’s web offering either (other than Wikipedia which would cause even more disruption if it ever when ad funded) This variety of content with contextual display advertising is likely to draw niche advertisers away from more generic content on portals.

Why it will kill Netscape – If Techcrunch and Alexa are to believed since scrapping social news Netscape’s traffic has dropped even lower than before. They aren’t the only ones struggling too, with AOL announcing serious downscaling and Microsoft losing major money on MSN. With a big new competitor for advertising dollars it’ll be interesting to see how long they have left…

  • Glad you liked the post Kelvin. Most of the press over here is about the fact that this is the 1st time the Beeb has ever taken ads (which is obviously big news), but they’re ignoring what it will almost certainly do to the market (maybe because they’ll get hit too?

    One side-point is that the Guardian is suggesting that research the BBC did in the US showed that American visitors would lose trust in the site if it does start taking ads. Looks like they’re between the proverbial rock & hard place.

  • It’s a huge departure but given what a huge success outside the UK their website it was difficult for them to resist for ever. The argument goes why should a british tax pay for international entertainment…

    Problem is it is sets a dangerous precedent for bbc. I’m one of the few people who don’t mind paying a tv license for what they currently offer. Sometimes feel I’m in a minority though

  • They don’t allow adverts on the BBC TV/radio channels, but on the other side of the coin, how else could they monetise their site. Unless they do a Wiki and go for the “trusted brand” approach.

    They already have a search engine but even thats nothing special.

  • “how else could they monetise their site.”

    Surely the question is, as Kelvin suggests, why should they have to?

  • Ciaran with all due respect, you didn’t read my comment in full.

    Unless they do a Wiki and go for the “trusted brand” approach. Which being a World Service would work. Was my next line.

    The Beeb are having problems at the moment: They are shedding 2,500 jobs at the moment and because of that a strike is looking to be imminent. This will lead to more repeats on TV, less workforce and probably an increase in TV licence.

    Hmm, I am not sure I trust the BBC all that much now.

  • Deb – I did read it, I guess I just didn’t understand it (not sure I do now); anyway, apologies.

    I’m not sure whether you’re suggesting that they could ‘monetise’ being a trusted brand, because in a way I guess that is what they are trying to do now (i.e. selling ads off the traffic they have built up through their status as an impartial news provider). It would be great if the government would invest more in the World Service and, through that, the international version of the site, but it’s just not a vote winner. Or do you mean that they should follow Wikipedia’s business model? I’d love to see what the Daily Mail’s reaction would be if funding was brought in from someone who got rich from an ‘erotic search-engine’. 😉

    With regards to the Beeb’s problems the whole reason that they are in these straits is because they are not being allowed to raise the licence as much as they wanted; the BBC has many faults, but being short £2 billion is not, I don’t think, something we can blame on them (their handling of the crisis is a different matter).

  • Couldn’t they just use AdSense in the mean time? 😛