Enom 2011 Annual Report Download - page 7

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Item 1. Business
Our Mission
Our mission is to fulfill the world's demand for commercially valuable content.
Overview
Demand Media is a leader in an Internet-based model for the professional creation and distribution of high-quality, commercially valuable, long-lived
content at scale. Our differentiated approach to content creation is driven by consumers' desire to find specific information across the Internet. By listening to
consumers and the signals that they send, we are able to create and deliver content that fulfills their needs. Through our content creation and distribution
platform-which combines a studio of freelance creative professionals with proprietary algorithms and processes combined with editorial oversight-we
identify, create, distribute, license, and monetize in-demand, long-lived content formats.
Our business is comprised of two distinct and complementary service offerings: Content & Media and Registrar.
• Our Content & Media offering includes a content creation studio and community of freelance creative professionals, social media applications, and
a system of monetization tools. We deploy our proprietary Content & Media platform both to our owned and operated websites, such as eHow.com,
LIVESTRONG.com and Cracked.com, as well as to websites operated by our customers, such as USATODAY.com. According to comScore, our
owned and operated websites comprised the 17t h largest web property in the United States and we attracted over 100 million unique visitors and
over 815 million page views worldwide in January 2012.
• Our Registrar, with over 12.5 million Internet domain names under management as of December 31, 2011, is the world's largest wholesale registrar
and the world's second largest registrar overall. As a wholesaler, we provide domain name registration and offer value-added services to over 8,800
active resellers, including small businesses, large e-commerce websites, Internet service providers and web-hosting companies.
Our Content & Media service offering generates revenue primarily through the sale of advertising, both on our owned and operated websites and on
our customer's websites, and through the sale or license of content we create for our customers. Our Registrar service offering generates revenue through
domain name registration subscriptions and other related value-added services offered by us.
Demand Media was incorporated in Delaware in March 2006. We are headquartered in Santa Monica, California and have offices in other locations in
North America, South America and Europe. We completed our initial public offering in January 2011 and our common stock is listed on the New York Stock
Exchange under the symbol "DMD".
Industry Background
Over the last decade, the Internet has evolved into a new and significant source of content, challenging traditional media business models by reshaping
how content is consumed, created, distributed and monetized. Increased access to the Internet as a result of extensive broadband penetration and the rapid
proliferation of connected mobile devices is driving significant growth in demand for niche content online. As a result, there has been an exponential increase
in the number of websites and mobile applications created and the amount of content available digitally. Businesses and brands have attempted to gain the
attention of consumers by enhancing their online presence, blurring the distinction between traditional publishers and marketers. Concurrently, search
technology and social media platforms have continued to improve the organization of and access to the broad range of websites and online information,
reshaping consumer behavior and expectations for discovering credible and relevant information online.
Consumption Trends
The Internet has fundamentally changed the consumption of media. The proliferation of the Internet and social media has enabled consumers to seek
out and interact with content in different formats across an increasing number of websites. As a result, consumers are changing the way they discover content
online, increasingly typing queries into web search engines or directly navigating to well-known, engaging and topical websites to discover and access content
from the millions of websites on the Internet. Further, advancements in web search technology and the popularity of social media have enhanced the ability to
find specific content associated with personal needs and interests, leading to an accelerating migration of the consumer base away from content consumed on
traditional portals. However, we believe that consumers are often faced with incomplete or
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