The real-time search company OneRiot is launching an advertising play for Twitter. The new feature, called RiotWise, lets content companies push links to their stories on the OneRiot search result pages. It's unlike every other online ad play out there in that the advertisements are for content, not commerce.
Say you're doing a OneRiot search for "Paris." Instead of seeing ads for airfares and hotels, as you would on Google, you'll see instead links to "Featured Content" about Paris from content producers -- news sites, blogs, and online magazines.
For the user, these are useful links, and thus valuable. But pulling this off for content is harder than it is for commerce, both financially and technically.
On the money side, online content pays less, per page, than commerce. A single click on a news story is monetized primarily by advertising. A good news page makes a few pennies per page view. Most make far less. A commerce page designed to sell something, clearly, can make a lot more.
And on the tech side, there are vastly more content pages than there are ads, so matching a story to a search result page means that the OneRiot system has to do more than just let advertisers say which page goes with which keywords. OneRiot has to read in content feeds from its advertisers in near real-time, and pitch to users only the best and most current stories from partners, based on user search terms and content inside the stories.
OneRiot CEO Kimbal Musk (Elon's brother) says that the company's advertising customers will find the incoming links from his service's users valuable, since OneRiot users are likely to redistribute (re-tweet) or forward stories along, thus increasing a story's presence.
It's a unique plan to monetize Twitter, but it's a delicate balance. Essentially it's an arbitrage model: Musk is asking publishers, who are paid by advertisers, to themselves pay for advertising on OneRiot to get more traffic, thus increasing their revenue yield per page. There's nothing fundamentally new about the concept (TV shows are advertised on TV all the time), but it's a bit of a tightrope. (Disclosure: I have heard that CBS is a partner of OneRiot, but Musk would not confirm this with me. CNET News is published by CBS Interactive, a unit of CBS. Update: More recently, I learned there is no such relationship between CBS and OneRiot.)
RiotWise ads will run on the OneRiot.com site, but the real potential for this plan, according to Musk, lies in the integration of RiotWise into Twitter apps. Potential customers are Tweetdeck, Seesmic, etc. In two weeks, a new application programming interface will let developers embed RiotWise suggestions into search results. OneRiot will share revenues with app developers for these paid links.
This is a smart play. Advertising will continue its move to the Web. When the economy begins to really turn around and general online advertising increases, the online pubs hosting these ads will need to generate additional pages to make good on their commitments to customers to deliver clicks. Thus OneRiot's plan may just work. It's not likely, however, that it will remain independent or unchallenged. This technology belongs at Google, or Microsoft. I expect it will end up there, one way or the other.