Google, Pheedo, Feedster and Yahoo Search Marketing are all peddling advertising options for RSS, an increasingly popular way of having a personal computer automatically retrieve information from the Internet.
For example, RSS users interested in local weather could view forecast updates on their computers without having to visit a particular Web site.
Some big companies, like Verizon, are starting to buy space in the RSS information streams, which are selected anonymously and pulled from Web sites by a PC.
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RSS is somewhat like TiVo for the Internet. By letting people have content pulled from Web sites and fed to their own computers automatically, they can then store it for later viewing. The growing number of RSS users has some online publishers--they are now the biggest group of suppliers of RSS feeds--starting to worry that RSS could take eyeballs away from their existing advertisements on the Web.
The Washingtonpost.com, part of Washingtonpost.Newsweek Interactive, for example, is considering ways to insert ads into its RSS feeds, which currently include only headlines and links to articles on the paper's own site. "Anytime a medium attracts a large audience, people begin to think through and figure out ways to deliver ads to that audience," said Tim Ruder, vice president of marketing for Washingtonpost.Newsweek Interactive. "RSS won't be any different in that regard than any other medium."
RSS feeds from The New York Times include headlines, a brief summary and a link. Visitors to nytimes.com via RSS feeds has soared from about 500,000 a month at the end of 2003, to 7.3 million last April, said Toby Usnik, the New York Times Company's director of public relations.
Google announced a few weeks ago that it would place ads in RSS feeds, using a computerized system to match ads to content. Yahoo Search Marketing, formerly Overture, also uses a computerized system to place RSS ads, then uses an editor to check many of the ad placements. Pheedo, a company that is placing ads in RSS streams for about 100 advertisers, allows the supplier of the feed to decide which ads will appear with its content.
Most RSS feeds--from places like Amazon.com, PBS, the British Broadcasting Corporation, and Craigslist--do not now include advertisements. The feeds themselves, which often include summaries of stories or product offerings, serve as advertisements for the sites' content, and those sites often have ads.
But research is showing that RSS users are often just looking at the feeds, and not the sites where they originate. Google is encouraging content providers to send everything they have, not just headlines, and to include ads only at the end of the feed. "We need to preserve all of the things that are good about RSS feeds right now and also introduce the opportunity for publishers to monetize those feeds," said Shuman Ghosemajumder, a business product manager at Google.
Companies placing advertisements in RSS feeds say they are still testing, trying to track how many ads are clicked and to decide how much they should pay for the ads. Advertisers are paying anywhere from 50 cents to $1.75 per click to Pheedo for ads. Niche advertisers tend to pay more per click, said Charles M. Smith, president and chief operating officer for Pheedo. The company placing the ad, like Pheedo or Google, and the publisher of the content in an RSS feed share the amount paid by the advertiser for each reader clicking on an ad.
Some RSS advertisers and content suppliers would like the pay rate to be based on how many people view their ads--not how many click on them.
But tracking ad views is difficult, since it is hard to know how many people actually read the RSS feeds they pull in, Smith said.
He believes RSS ads should be conversational in tone and provide information. "In RSS, you're in the mode of absorbing information," he said. Pheedo has tested RSS ads of various lengths and found that 500-word ads, instead of the shorter search ad length of about 100 words, tend to work better. RSS users like to read most of the pitch in their RSS screen, without having to quickly click to another site, he said.
Advertising agencies said RSS feeds attract a younger, wealthier