US content broker starts Euro drive

Content broker ScreamingMedia has begun its European expansion by pushing free customised software.

The focus on Website content intensified this week with the expansion into Europe of US content broker ScreamingMedia.

The company has opened an office in London as its first non-US territory. It will begin by developing a stronghold in the UK but further footholds on the Continent are expected to follow shortly.

ScreamingMedia, founded in 1996 by ABC TV executive Alan Ellman and Jay Chiat, founder of ad agency Chiat Day, is rushing to establish a potentially massive new market.

The explosion of Websites – the number has been doubling annually and now stands at 6 million – has prompted increasing demand for content that can keep users on a particular site. With so-called “stickiness” flavour of the month, time spent on a Website is becoming an important measure for advertisers.

ScreamingMedia’s business model is based on the view that online content providers and subscribers are an increasingly disparate bunch, which need to be brought together much more – and much faster – than ever before. The company feels vindicated rather than threatened by the recent AOL-Time Warner merger, because this has “reinforced the importance of content”, says international president Gregoire Sentilhes, who is heading the international expansion.

ScreamingMedia, which already supplies “custom-filtered” content for more than 400 US Websites, claims the Internet content market is worth “at least” $4bn (&£2.5bn) and is to more than triple by 2003. This would put it on a par with other major media markets. The newspaper and book publishing markets are currently valued at $37bn (&£23bn) and $31bn (&£19.4bn), respectively.

The 500-plus content providers working with ScreamingMedia in the US include Associated Press, New York Times and Red Herring. Its international providers include Thomson Financials, Businesswire.com and UPI. It has over 400 subscriber Websites, including MSN, AOL, Doubleclick, Adidas and the Discovery Channel Online. The company is also moving into the wireless application protocol (WAP) arena, working with 3Com’s Palm Pilot and Skytel, among others.

ScreamingMedia is the dominant player in a relatively untapped market. Its competitors include Moreover.com and iSyndicate.com. Although Yahoo! has carved out a powerful position as a content aggregator, Sentilhes believes his model is different, as it is based on syndication rights.

ScreamingMedia is also bullish about its decision to develop its own customising software and distribute this free, instead making all its money on subscription revenues. Content providers receive 35 per cent of the total income, while subscribers are charged a $2,500 (&£1,563) set-up fee and an average monthly fee of $1,500 (&£938).

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