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Internet research market in a frenzy

Internet research market in a frenzy

Market research giant ACNielson has announced its acquisition of Internet research company www.consult for an undisclosed amount, in a bid to strengthen its Internet-related services.

The www.consult business, formerly owned by its principal consultant Ramin Marzbani and other employees, will remain a separate entity from ACNielson and will also maintain its current business model and staff.

Ian Webster, a media analyst at www.consult, said the services the two firms offer do not compete or overlap, and www.consult's analytical research should be seen as complementary to ACNielson's panel-based research.

"Our motivation behind this deal is that we've been doing a lot of work in Asia and need a strong distribution partner to further our work there," he said. "ACNielson has offices throughout the region."

The acquisition follows the development of several new Internet-related businesses at ACNielson, including its ACNielson.online market research business, and the ACNielson eRatings.com business, a panel-based audience measurement service that measures the Web-surfing behaviour of Internet users. Aside from Media Metrics, the company's main competition in this space is Australian-born Internet measurement company Red Sheriff, which is making some bold moves of its own. Red Sheriff is in the process of relocating to the US market after adding a further $3.5 million of funding from Ericsson-Deutsche Technology Fund to the $34 million raised through Deutsche European Partners last month. Red Sheriff has also purchased the rights to a patent from Thinking Media that will strengthen the company's measurement of rich broadband media content and mobile media content.

Vivienne Foyen, marketing and communications director at Red Sheriff, said the ACNielson move was no surprise as it mimicked Media Metrix's acquisition of Jupiter research earlier this year. She claimed Red Sheriff's "sharpshooter" service has been offering similar syndicated reports to what www.consult provides for four years.

"Without the acquisition, I think www.consult would have been squeezed out of the market anyway," she said. "Competitors are internationalising their research and offering everything at a larger scale. For ACNielson, it rounds out a service offering which was ad hoc."

While ACNielson offers its Australian clients panel-based user research of around 10,000 panelists, Red Sheriff offers 3000 panelists and a browser-based technology which measures unique user hits and page impressions for Web sites. Brian Milnes, general manager of Nielson NetRatings, said he views Red Sheriff's US relocation as a bold move. He cites the example of a US company named Ipro that offered a similar service several years ago, but only held the spotlight for a short period before the market diverted its attention back onto panel-based ratings systems.

"They are moving into an aggressive market where people are starting to really watch their spending closely," he said.

Milnes said he believes the statistics coming out of technology-based measurement systems are unrealistically high and are aimed at clients who want to over-hype the popularity of their site to attract better advertising dollars. These statistics create extraordinarily high levels of expectations in the Internet market, he said, in a medium that is still immature and underdeveloped.

"Any measurement that comes from inside an organisation involving the readings of a machine is suspect to manipulation," he said. "People are a little bit suspicious of self-management. Decisionmakers are more confident with the panel system because external measurement is more likely to be objective. That inference is totally misleading," said Foyen. "It's misinformation."

Foyen said the Red Sheriff measurement services have been tested by AGB and Gallop, and the company will soon be releasing a research report from one of the big five consultants, all "unequivocally verifying the accuracy of both the traffic and the impression accounts the technology measures." She said Red Sheriff's technology is far in advance of anything that has been offered in the US in the past.

Foyen said she has attempted to clarify any uncertainty over Internet measurement by contacting ACNielson, Media Metrics, as well as publishers and industry bodies like the IIA, in the hope of bringing all the parties together to create a standard definition for measurement.

"We want to address any negativity or uncertainty about the potential of the Internet so this medium can go forward and people can make informed decisions," she said. So far her requests have had no response.


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