SEOUL: Internet measurement company ACNielsen eRatings has
withdrawn its sales operations from Korea and other unspecificed Asian
markets in an effort to slash costs and remain competitive.
US-based NetRatings, which operates in Hong Kong through its
joint-venture with ACNielsen, also announced that it would merge with
rival Jupiter Media Metrix to take control of the joint-venture.
NetRatings will buy out ACNieslen's 80 per cent interest in eRatings.com
for US$16.4 million. It will also pay $71.2 million for
Jupiter Media Metrix, with the deal scheduled for confirmation early
next year. Jupiter Media Metrix is the result of the acquisition of
Jupiter Communications by Media Metrix in 2000.
The moves signal a further consolidation in the internet research
sector, which has found it difficult to build up interest in web metrics
as regional economies deteriorate and confidence in the web wanes.
ACNielsen eRatings.com managing director, Hugh Bloch, said: "We have
withdrawn from a number of markets and you could say we are redefining
our footprint. We have pulled our sales people from Korea and they have
been replaced with regional client and sales services, so we are still
serving that market.
"The reason is cost. Part of it is that we believe this is the way to
work more efficiently and a lot faster. There is certainly a slowdown
and revenue is not going as projected to growth. Our aim is to become
the 'currency' of choice and this can help us get closer to our
objective.
"There are economic reason for our withdrawal of sales in Korea. Despite
us claiming it to be the market leader, it was not financially
viable."
Bloch declined to comment on the research company's withdrawal from
other regional markets, but emphasised the move was in line with the
researcher's "path to profitability". eRatings services measure internet
users in 30 countries worldwide, including China.
He added that the merger was likely to highlight service and job
duplications in various markets.
"If it happens, there will obviously be duplication and markets will
overlap. It also depends on the service mix in each market, but we will
ultimately want to save costs between us."
According to Bloch, Hong Kong is the company's strongest market in the
region. The researcher claims it has an 80 per cent market share in
revenue terms.
"Compared to Korea, in terms of total revenue not contracts, Hong Kong
is a lot stronger. But what we can expect is further consolidation in
the market. I still believe there are too many players in this space.
The revenue cannot afford so many players," he added.
