JupiterResearch Projects Vertical Search Will Drive Industry Growth

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JupiterResearch Projects Vertical Search Will Drive Industry Growth, with Four Industries Dominating Search Spending

NEW YORK--(BUSINESS WIRE)--Feb. 23, 2005--JupiterResearch, a division of Jupitermedia Corporation (Nasdaq: JUPM - News), today projected in its newly released report, "Vertical Search: Early Marketers Will Reap Rewards of Low Pricing," that the search industry will develop in much the same way historical media markets before it have, with the broad-based search engines spawning a raft of vertical search engines dedicated to specific categories.

"Broad-based search engines are extremely good at navigating vast amounts of information, but extremely poor at helping a consumer make a purchase decision," said Niki Scevak, analyst with JupiterResearch. "This creates a large opportunity to enhance the consumer experience with vertical search," added Scevak.

The report finds that paid search spending in the U.S. is highly concentrated. Just four categories - retail, financial services, media and entertainment and travel - accounted for 79% of the $2.6 billion spent on paid search in 2004. Each vertical provides a rich landscape of opportunity and a blueprint for how other categories will develop.

In the search market overall, rapidly rising keyword prices on broad-based search engines will soon stabilize and industry growth will depend substantially on the incremental value provided by vertical search engines. "The trend will cause a sea change in how advertising spending is allocated online and force media firms in vertical categories to embrace performance-based advertising pricing models," said Scevak. "If vertically focused media firms do not seize this opportunity, search engines like Yahoo! and Google, as well as a number of established and startup vertical search engines like Shopping.com and Sidestep will enter to satisfy the market demand."

The JupiterResearch report enumerates the top search marketing categories, analyzes the reasons why certain categories contribute disproportionate amounts of spending and recommends strategies for media firms, advertisers and their agencies to apply to vertical search initiatives.

The complete findings of this report are immediately available to JupiterResearch clients online at www.jupiterresearch.com. For more information on the report or JupiterResearch's Online Search research service please contact Kieran Kelly, Vice President of Global Sales and Client Service at 1-800-481-1212 or researchsales@jupitermedia.com.

About Jupitermedia Corporation

Jupitermedia Corporation (Nasdaq: JUPM - News; www.jupitermedia.com), headquartered in Darien, CT, is a leading global provider of original information, images, research and events for information technology, business and creative professionals. JupiterWeb, the online media division of Jupitermedia, operates five distinct online networks: internet.com and EarthWeb.com for IT and business professionals; DevX.com for developers; ClickZ.com for interactive marketers; and Graphics.com, for creative professionals. JupiterWeb properties include more than 150 Web sites and over 150 e-mail newsletters that are viewed by approximately 20 million users and generate over 300 million page views monthly.

Jupitermedia also includes: JupiterImages, one of the leading images companies in the world with over 5.0 million images online serving creative professionals with products like Comstock Images, Thinkstock Images, Thinkstock Footage, Photos.com, HemeraImages.com, Ablestock.com, Clipart.com and Animations.com; JupiterResearch, a leading international research advisory organization specializing in business and technology market research in 18 business areas and 14 vertical markets; and JupiterEvents, which produces offline conferences and trade shows focused on IT and business-specific topics, including Search Engine Strategies and WiFi/VoWiFi Planet.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release which are not historical facts are "forward-looking statements" that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The potential risks and uncertainties address a variety of subjects including, for example, the competitive environment in which Jupitermedia competes; the unpredictability of Jupitermedia's future revenues, expenses, cash flows and stock price; Jupitermedia's ability to integrate acquired businesses, products and personnel into its existing businesses; Jupitermedia's dependence on a limited number of advertisers; and Jupitermedia's ability to protect its intellectual property. For a more detailed discussion of such risks and uncertainties, refer to Jupitermedia's reports filed with the Securities and Exchange Commission pursuant to the Securities Act of 1933 and the Securities Exchange Act of 1934. The forward-looking statements included herein are made as of the date of this press release, and Jupitermedia assumes no obligation to update the forward-looking statements after the date hereof.

All current JupiterResearch press releases can be found on the World Wide Web at http://www.jupiterresearch.com/bin/item.pl/press:releases/

All current Jupitermedia Corporation press releases can be found on the World Wide Web at http://www.jupitermedia.com/corporate/press.html.

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Contact:
Jupitermedia Corporation
Marketing and Public Relations:
Lisa DiGiacomo, 212-547-7938
ldigiacomo@jupitermedia.com

Comment by Chris Nielsen:

This just came in and I had just commented to the Webmaster from www.beasleyallen.com that this was my vision of the future, as I have mentioned before. Just as we saw computer processor speed increase from 1 MHz with the Timex-Sinclair and Commodore 64, to multi-processor super computers, there is a limit of how much you can do in our physical universe with the materials at hand. So too, there are limits to how much one search engine, or in the case of Google, many thousands of search engines can do, to produce results at one fixed delivery point.

To me, the answer is simple. The major search engines will provide more and more results from other search engines and directories that can be shown to deliver quality results on a narrow category, or specific topic. It will become Google's job to determine which of these sites really provide the best content, and the mechanism to do so is already in place to a large degree.

Yes, Google Ad$ense could be used to determine what sites are "good" and which are "bad" by the number of impressions versus number of clicks. We already know that bad sites on a specific topic can generate more revenue than a good site on a topic. The reason is the the ads are more likely to be what the searcher is looking for, so they click and leave the site.

The Irony is that the better sites that use Ad$ense will realize less revenue than the bad sites, a situation that will have to be reversed by some means that is not at all clear to me at this time.

(hris