NetGravity to launch new ad service bureau

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Netgravity, the leading ad server software vendor, will announce next week at New York Internet World a new service bureau called AdCenter.

The service is aimed at medium-sized publishers wishing to outsource the technical hassle of ad serving while retaining control of their own ad sales. Currently in a pilot period, NetGravity plans to bring AdCenter fully online February or March, according to Rick Jackson, VP of marketing.


NetGravity's recent change from that of software vendor to service provider is the latest move in a trend among online ad serving networks.

More than a dozen startups with ad serving solutions are vying for a limited number of top Web publishing clients, and industry analysts predict the ones that will survive will have to offer a wide range of products and services to broaden their customer bases.

Mr. Jackson said AdCenter is the beginning of a series of new initiatives for the company, which recently completed a three-year plan. Asked to respond to industry rumors that the firm is looking for a new CEO to replace John Danner (also president and founder), Mr. Jackson said only "no comment," while not denying the rumors.

Though unproven as a service organization, NetGravity's name recognition and status as market leader of the software category promise to be an advantage as it enters into new competition with established service bureaus such as DoubleClick DART, Imgis, MatchLogic and others.


NetGravity's new service will not, however, include any ad sales, leaving it out of direct competition with sales repping networks such as the SoftBank Network, Real Media and the DoubleClick Network.

AdCenter will be based on the network version of NetGravity's core AdServer software product. NetGravity counts 170 customers so far for its software products--including top trafficked sites such as Netscape, Time Warner's Pathfinder network and the New Century Network of news sites--in all more than 20 network publishers serving almost 1,000 sites worldwide, according to Mr. Jackson.

Only two weeks earlier, ClickOver, a NetGravity competitor with its own ad server software, ClickWise, merged with Focalink, whose SmartBanner service bureau outsources for agencies and publishers.

Jupiter Communications' analyst Evan Neufeld said in response to that merger, "Two years ago [companies] like NetGravity were saying, `We're going to sell an ad server to everyone in this market and that's where we're going to make our money.' Now people have fundamentally changed the way they're viewing the market and they're going to a service bureau type of model.

"They're realizing a lot of people not even won't be able to afford their own ad server but don't need one, and it will be more common to outsource it," said Mr. Neufeld.

Copyright December 1997, Crain Communications Inc.

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