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1. 4th FIPP International b2b Magazine Conference The Collision of Online and B2B Media Patrick Kenealy CEO International Data Group pk@idg.com YOUR LOGO HERE

2. 4 key issues and 5 suggestions 1 New technologies create new media The rate of new media change is under-measured and underestimated New media technology displaces and changes old media New media are often your friend. New media companies are often your competitors! 2 3 4 YOUR LOGO HERE

3. 1 New technology creates new media • Steam-powered rotary press: Giant metropolitan newspapers • Railroad: Big national magazines • Telegraph & fax: Newspaper chains • Radio • Television • Computers and databases: Controlled-circulation publishing • Cable • Satellite • PCs, Internet, broadband: Web publishing YOUR LOGO HERE

4. 2 Rate of new media change often hard to measure – until it’s too late • For Internet media, we can measure: • PC, Internet and broadband installed base & growth data • Recent Internet company deals • The beginning of the Internet is over! We’re later in the paradigm shift than you think. The data for this exist, but are not organized YOUR LOGO HERE

5. In developed countries, theInternet is already mainstream YOUR LOGO HERE Central Intelligence Agency, IDC

6. Internet users continue growing YOUR LOGO HERE IDC

7. Broadband gaining sharePercent of Active U.S. users 14.4K 2.4% 28.8/33.6K 7.0% 42.7% 56K 47.9% Broadband YOUR LOGO HERE Nielsen//NetRatings, Apr. 2004, (@Home)

8. Ecommerce is one “external driver” YOUR LOGO HERE Worldwide Internet Usage and Commerce 2002-2007 IDC 2004

9. Recent Internet deals • This month, Ask Jeeves buys Tukaroo, (a desktop search company) after spending $500 million to buy Interactive Search Holdings (Excite, mysearch etc) last month • This month, Tech Target (online IT lead streaming) raises $70 million Series B private capital (5x trailing revenues) • Last month, WebSide Story files for $57 million IPO (4x trailing revenues) • Last month, Monster buys Tickle for $90 million (4x trailing revenues) • Last month, Google files for $2.7 billion IPO (3x trailing revenues) Switchboard, with revenues of $12 million was acquired by InfoSpace for $160 million in March 2004 YOUR LOGO HERE

10. Recent statistics • Estimated 227 million potential internet users or approx 75% of the US population (Neilsen). Active internet users are estimated at around 150 million (comscore / Media Metrix and Neilsen / Netratings). Broadband penetration at home is estimated at approx 33% • Female web users now equal male users. • Web advertising is expected to reach $8.4 billion, up 15% from last year. (emarketer) • Internet advertising totaled nearly $2.3 billion in Q1 2004, a 39% increase over Q1 2003. (IAB) • In Q4 3003 Web advertisers devoted 41% of their budgets to performance deals that delivered a click or customer. CPM deals fell to 40% (46% in 2002). • Consumer spending for online content (subscriptions) grew to nearly $1.6 billion in FY‘03 an 19% increase over 2002. • Online retail sales is expected to increase 27% to $144 billion in 2004. Although a small proportion of total retail sales (5.4%) in certain categories such as computers 43% of 2003 sales were over the internet. (National Retail Federation / Forrester) YOUR LOGO HERE

11. 3 New media displaces and changes old media • Readers and advertisers historically make room for each credible new medium • Reader and advertiser movement is clearly measurable • The internet is changing the world of IT media. YOUR LOGO HERE

12. Paid online content sales are up 2003 saw consumer spending for online content grow to nearly $1.6 billion, an 18.8% increase over 2002 YOUR LOGO HERE Online Publishers Association (May 2004)

13. B2B readers respect online media IMPORTANCE OF INFORMATION SOURCES TO U.S. B2B READERS YOUR LOGO HERE ABM “B2B Audience of the Future” (May 2004)

14. B2B readers will readmore online media EXPECTED CHANGE IN USAGE (5 YEARS) BY U.S. B2B READERS YOUR LOGO HERE ABM “B2B Audience of the Future” (May 2004)

15. Overall, Web advertising revenue is up (MILLIONS) YOUR LOGO HERE IAB Internet Advertising Report (April 2004)

16. US Online ad segments 2003-2008 CAGR: Online display ads: 18% Paid search: 22% Online classifieds: 16% (billions) Spending (US) YOUR LOGO HERE Jupiter Research Internet Advertising Model, July 2003 (US only)

17. Overall, Web advertising share up YOUR LOGO HERE TNS Media Intelligence/CMR

18. Online advertising is big already in many countries, vertical markets • U.S. I.T. advertisers already spend much of their ad budgets online YOUR LOGO HERE

19. New media displaces old media • U.S. I.T. advertisers value print media but they respect online, too. Advertiser perceptions are changing. YOUR LOGO HERE

20. New media displaces old media • U.S. I.T. advertisers plan to shift share to online. • Advertiser intentions are changing. YOUR LOGO HERE

21. U.S. B2B print advertising for IT falling YOUR LOGO HERE American Business Media – Business Information Network (BIN)

22. Or is it? YOUR LOGO HERE American Business Media – Business Information Network (BIN)

23. New media changes old media • Online (Web sites, email, Webcasts, e-zines, ecommerce, shopping bots), creates new products but changes all your other activities • Print (paid and registered, magazines, newspapers, newsletters, buyers guides, directories, white papers…) • Direct marketing (list rental, lead streaming, direct mail, card decks…) • Live events (trade shows, conferences, seminars, classroom training…) • Market research (user-side, vendor-side, channel-based, primary, panel-based…) YOUR LOGO HERE

24. 4 New media are often friendsNew media companiesare often competitors • Consider Google: (and the some other search engines) • First, it felt like a great way for readers to find your online content – and your ad banners • Next, it felt like a cheap source of clicks & page views • Then it started selling “your” industry keywords against you! • Consider TechTarget: (and the other lead streaming companies) • First, it felt like a great way for readers to find your online content – and your ad banners • Then it used your traffic to attract readers that it monetized by selling hot “leads” to your advertisers – which they paid for by reducing their ad spending YOUR LOGO HERE

25. New media companies are often competitors • Consider the Portals: (AOL, Yahoo, MSN, Lycos, etc) • First, they were advertisers -- as they built audience • Next, they bought content -- and sold advertising around it • Then, they tried to make publishers pay to display content, or linksThen it starts • Consider DoubleClick: (and the Ad serving SW and network companies) • First, they sold us tools and services • Next, they built relationships directly with our customers • Then they helped – at least temporarily – commoditize online advertising YOUR LOGO HERE

26. Google – the rough numbers YOUR LOGO HERE Google, Inc. SEC Filings (05/29/04)

27. New media are often friendsNew media companies are often competitors • But remember: • New media company business models change – quickly • This year’s monopoly faces competitors next year • AOL, Netscape, Yahoo, Doubleclick, Google • Competition for customer ownership is constant between content producers and aggregators/distributors YOUR LOGO HERE

28. 1 Stay very aware of newmedia and technology • Portals are “old” media technology • Search is current media technology • What are today’s “future” media technology: • Cell phone content -- BIG • Blogs -- BIG • e-zines – TRANSITIONAL • Webcasts? • RFID? • Data mining? • Super CRM? • What are your “Future 5” media technologies? YOUR LOGO HERE

29. 2 Include online in yourmarket share measurements • Market served -- industry, geography, language • Share of buyers, $ reached -- print and online • Share of all ad dollars captured – print and online • Online very hard today, so was TV, radio, outdoor in past • Normalization is hard, but the big customers and agencies all do it today • Rough estimates now better than perfect data next year YOUR LOGO HERE

30. 3 Improve your online accounting and metrics • Can your top managers write down your online business model(s)? • Do you understand your top 10 online operating metrics? (Amazon, AOL, Blue Nile, Cnet, Google, NYTimes.com, WSJ.com, Yahoo do) • How many online revenue categories in your general ledger? • Can your accounting system prove online profitability overall and by revenue stream? YOUR LOGO HERE

31. 4 Find and adopt online best practices • The Internet and related tools can save $ in every department • Circulation acquisition and renewal • Advertiser and reader CRM • Billing • Production and editorial copy flow • New product development • Join trade associations like IAB, OPA, • Push trade associations like FIPP, ABM, MPA to embrace online and tackle its big collective issues YOUR LOGO HERE

32. 5 Know friends and enemies • Read and understand your company’s top 5 online partner and supplier contracts • Try to buy your industry’s 10 most important keywords. See the price and the current owners • Do short-term deals to match changing times and partner business models YOUR LOGO HERE

33. There is more opportunity than danger here. Go for it! Patrick Kenealy CEO, IDG pk@idg.com