ADVERTISING ON MUSIC SITES RISES
It’s Good News, Right?
CNET reports advertising spending at online music sites jumped dramatically in the week after a federal judge clamped down on Napster, according to AdRelevance, a division of traffic measurement company Media Metrix.
Before the July ruling, advertisers spent about $2 million on music and streaming sites. In the week after, that figure jumped to about $5 million, researchers reported.
"Soon as the Napster ruling came down, people flocked to the music sites and created an opportunity for advertisers to jump into the action," said Marc Ryan, one of the authors of a report.
The report drops right before next week's scheduled appeals court hearing on the much-publicized RIAA copyright infringement suit against Napster.
The AdRelevance report offers new aspects to the economics of file swapping by tracking the advertising dollars that have followed consumer interest in the technology.
In February, Media Metrix recorded 1.1 million unique visitors to the Napster. After the July 26 ruling, Napster hosted 4.9 million unique visitors. The high traffic numbers lured new advertisers such as State Farm Insurance, Bonzi Software, Allstate, Network Solutions, X10 and Citicorp.
The surge in revenues was short-lived, however, as traffic and advertisers retreated after a federal appeals court agreed to temporarily suspend the decision to shut down Napster pending an appeal, the report says. Ryan believes there will be another rush of visitors after the Napster court hearing in the appellate court next week. And, advertisers will likely take advantage of that traffic.
