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RICHARD COLE
Everybody talks about the weather, but it took the Internet to do something about it.
A blizzard of statistics show that weather is one of the Web's star attractions, and media companies including the Weather Channel and its Weather.com site are capitalizing on the Internet's strength to deliver what amounts to almost individualized forecasts.
"Weather is obviously perfect for the Web, as opposed to all the material that's not working on the Internet, like many fancier forms of media," says analyst Tom Adams, president of Adams Media Research. "It's a perfect content type - its far more accurate than certainly a national weather feed can be on TV, and more timely than the local news and more timely than the local paper."
The public, at least the portion using the Internet, seems to agree.
According to the Pew Research Center for the People & The Press, among Web news consumers, 66% go online for weather, making it the single most popular reason to surf the Net. That figure jumped up from only 47% in 1996. NetSmart puts the figure even higher than Pew, at 70%, and adds that "checking weather" is the second most popular wireless Web activity.
When weather watchers reach the Net, their top destination is Weather .com. Nielsen's NetRatings lists the site as the No. 1 news and information site and the top TV-related Web site. Media Metrix consistently ranks Weather.com in the top 30 of all Web sites and among the top single-content sites.
Traffic increases 50% to 60% annually, double the Internet's 20% to 25% rate, says Weather .com CEO Debora Wilson.
Changes at the Weather Channel are likely to drive even more traffic to the Web site, says Whit Andrews, research director for the Gartner Group.
Much as MTV has moved away from music videos, the Weather Channel has traded round-the-clock forecasts for more TV-friendly programming.
"Now they've got shows, and the local forecast isn't as regular as it used to be," Andrews says. "You can see they are assuming the Internet will probably provide that constant feed capability. Now localization becomes very interesting, and when you can get it on-demand, it becomes very valuable."
Weather.com is aggressively localizing with a "relaunch" at the end of January. The company's philosophy is straightforward, says CEO Wilson.
"People want to know how weather impacts what they're going to do," she says. "Whether it's as simple as knowing whether you need to wear your coat out, or a little more complex like, `I'm a construction foreman, and I need to understand whether my guys can pour cement today.'"
The relaunch will add a series of features aimed at individuals, she says.
- The what/where search, which allows the user not only to find a forecast by ZIP code, but to specify an activity, such as "plan for ski."
- Hour-by-hour forecasts for the next 48 hours, individualized for all 77,000 locations worldwide.
- Local severe weather alerts, delivered to city Web pages and individually to e-mail, cell phones or personal digit assistants.
- Recommendation indices, assigning numeric rankings to locations such as ski resorts to determine the best locations and conditions for outdoor activities.
- Climatology data, providing historical temperatures, sunset times and other information for each day of the year in more than 7,000 locations.
The site also will include financial news from Bloomberg and improved navigational tools, Wilson says.
Weather.com is also expanding aggressively on the wireless front, she says.
"We see a day when you can punch a screen on your refrigerator and get not only the weather forecast, but stock quotes, news and your kids' homework assignments," she adds.
Playing Avis to Weather.com's Hertz is AccuWeather, a State College, Pa.-based company that streams weather forecasts to 70 television stations, as well as to 1,100 Web sites, including MSNBC, NBCi and Yahoo!
AccuWeather provides twice-daily localized weather updates for cities across the country, streaming them from its own studios to stations and Web sites. The company separately sells computerized weather graphics to television stations.
Jay Mathieu, TV broadcast manager for the company, acknowledges AccuWeather is No. 2 but says it outstrips Weather.com in key areas.
"For the Internet, we have a better broadband strategy at this point, particularly for streaming," he says. "I think we're a few months ahead of them as far as having content out there and building any kind of broadband technology in the weather industry."
These days you can't say Internet without saying "business model," and long-term profitability for weather sites is still a question.
"They're still wrestling with their business model - and you can hardly blame them," says Andrews of the Gartner Group. "They offer a critical service, something that everybody wants, but something that everybody has gotten for free all their adult lives."
Neither Weather.com nor AccuWeather is publicly owned, and both decline to discuss revenue in any detail. However, both are optimistic their strategies are bound for profitability.
AccuWeather receives income from licensing fees for its streamed broadcasts, as well as banner ads on its own Web sites. The company sometimes co-brands Web sites with television stations that can't afford to pay the licensing fees, splitting any revenue generated.
Weather.com's Wilson says her company benefits from the new model for success on the Internet - a combination of traditional and new media.
The Web site benefits from extensive cross-promotion with The Weather Channel, and they team up on ad sales, she notes. About 30% to 40% of Weather .com advertisers are shared with the TV channel.
"We are very close to break-even, and we anticipate Weather.com will be a very strong financial entity as we move forward," Wilson says. "From day one we saw the opportunity the Internet brought us to really grow a new business."
EXCITING NEWS Excite reported its worldwide subscriber base jumped 27% in the 4Q to 2.95M, meeting its target of 25% to 30% growth. Apparently not so exciting was the Internet service provider's deal to buy Pogo.com, an online gaming site. The company abandoned the deal for undisclosed reasons but will maintain its 10% ownership and will continue to buy games from Pogo.
BLODGET BEARISH Merrill Lynch's respected Net stocks analyst Henry Blodget turned decidedly bearish. He had once projected up to 40% ad growth on the Net in 2001, then lowered his estimated to 15%, or $9B. In a research note released last week, he lowered his sights again, saying ad spending will remain a flat $8B this year. The good news for Net companies is that Blodget believes the current quarter may mark the bottom.
STREAM FLOOD Videostreaming is turning into a flood, according to a survey by DFC Intelligence. More than 900M streams were accessed in 2000, an increase of 215% over 1999. Broadband streams were almost 29% of the total. The report estimates as much as 15% of available stream inventory now comes with in-stream advertising. Streaming success over the last year included the election controversy and Survivor.
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