Fox Interactive Media announced this morning that it has acquired the thrillingly named Strategic Data Corporation (Google cache of site). SDC offers ad optimization technology that it claims helps clients “typically see network-wide revenue increases of 50-150%.” Fox Interactive spans a large number of sites from AmericanIdol.com to AskMen.com but is dominated by MySpace. Thus today’s acquisition can be understood primarily as an attempt to leverage some high level algorithms to crank up MySpace monetization. SDC will optimize graphic ads and compliment Google’s search ads on MySpace.
Rupert Murdoch said two weeks ago that the site is bringing in close to $25 million in ad revenue each month. Murdoch says that in five years roughly ten percent of Newscorp’s earnings should come from its online properties. In order to best serve ads to an increasingly age and geographically diverse userbase like that of MySpace, the acquisition makes sense. A person can only click on the same dating service and punch the Flash monkey ads so many times; SDC’s technology could help make MySpace more appealing for more diverse advertisers. For a related example of a large content network taking control of an outside ad optimization service, see our coverage of the Yahoo! deal with RightMedia in October.
If MySpace is populated primarily by young people who treat it like email (probably not the best place to advertise) and old people who are there to try and sell things to young people themselves – then there may not be much hope for drastic improvements in ad revenue.
The SDC acquisition is the first major deal made since Peter Levinsohn took the helm of Fox Interactive Media after replacing his cousin Ross Levinsohn, the man who led the deal to acquire MySpace in the first place.