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Yesterday — January 18th 2021Your RSS feeds

Bustle CEO Bryan Goldberg explains his plans for taking the company public

By Anthony Ha

Bustle Digital Group — owner of Bustle, Inverse, Input, Mic and other titles — could eventually join the ranks of startups going public via a special purpose acquisition company (SPAC).

During an interview about the state of BDG and the digital media industry at the end of 2020, founder and CEO Bryan Goldberg laid out ambitious goals for the next few years.

“Where do I want to see the company in three years? I want to see three things: I want to be public, I want to see us driving a lot of profits and I want it to be a lot bigger, because we’ve consolidated a lot of other publications,” he said.

He added that those goals connect, because by going public, BDG can raise “hundreds of millions dollars,” which Goldberg wants to use to “buy a lot of media companies.”

That might seem like bluster after a year in which many digital media companies (including BDG) had to make serious cuts. But Goldberg said that the company would be profitable in 2020, with revenue that’s “a little bit under $100 million.” And it won’t be the first digital media company to take a similar route — Group Nine created a SPAC that went public last week.

“I want to prove that we can be highly profitable,” he said. “A lot of startups don’t have that goal. A lot of VCs tell their startups: Don’t worry about profits, don’t worry about losing money. I don’t believe in that.”

In addition to his plans to go public, Goldberg also discussed how acquisitions have helped Bustle’s business, his joint venture to purchase W Magazine and digital media’s “overcapitalization” problem. You can read our full conversation, edited for length and clarity, below.

TechCrunch: The last time I caught up with someone at BDG, it was with [the company’s president Jason Wagenheim] and that was when you guys were dealing with the initial fallout [from the pandemic]. Now we’re a lot further into whatever this new world is, so what is your sense of where BDG is now, versus where it was in the early days of the pandemic?

Bryan Goldberg: It might be the craziest, most eventful six months for many of us in our lives. And certainly, for those of us in this industry, the difference between April and October, it’s really hard to fathom, it’s complete night and day. April was a very frightening time for everyone, personally and professionally across the country, across the world.

From an advertising standpoint, it was a really scary time, because we have clients across every industry, and every industry was impacted differently. We have clients who were greatly impacted — theme parks, car makers, hotel companies, airlines — and then we had clients who were not as badly affected, such as a lot of CPG clients, who everybody depended upon so much during the pandemic.

There was a huge pause in our business in in March, April and May. For a lot of clients, tossing advertising was a sort of knee-jerk reaction to the sudden shock of COVID, and so we saw a huge negative impact in our second quarter. What we started to see in the third quarter, and especially now in the fourth quarter, is now that the shock of COVID is behind us, the macro trends that were catalyzed by COVID are now moving into the forefront.

The story of media is no longer about the shock of COVID. The story of media is now about all of the changes to our world, and changes to our industry that were brought about as a consequence of COVID.

The good news for our company, and the good news for other digital media companies, is it looks like the future is being accelerated. It looks like people are watching less television, and so advertisers are moving their budgets into digital faster than they would have had it not been for COVID. Even things like live sports, [their] TV ratings are way down. And a lot of advertisers are saying, “Is there efficacy anymore in cable television or broadcast television?” And the magazine industry was heavily impaired, simply because magazines are a physical medium, and people didn’t want to pass around magazines or read magazines at the dentist’s office, so we probably saw some print budget move into digital as well.

Industry analysts now are going to take up their estimates of what digital revenue is going to look like in 2021, 2022 and beyond. I also think we’ve seen a world in which a lot of brand advertisers are starting to think about what happens when they start to spend beyond Facebook and Google. For most of the last three years, there’s been so much talk about the duopoly, the idea that Facebook and Google are going to eat almost every last dollar of advertising. What we’ve seen in the last three months is advertisers saying that this needs to be the moment in which they learn how to deploy advertising spend digitally beyond Facebook or Google.

No, it doesn’t mean they’re all pulling out of Facebook — Facebook and Google are doing just fine. But there are still tens of billions of dollars that need to be deployed outside of Facebook and Google. And you’re seeing winners such as Snapchat, Pinterest. Both had incredibly strong earnings. They’re benefiting from the same thing that benefits Bustle Digital Group and a lot of other digital media players who aren’t Facebook and Google, which is you’re seeing big ad spenders finally deciding that now’s the time to find other ways to deploy advertising spend.

I think those are the two big trends: Dollars moving to digital out of TV faster than we thought, and major advertisers using now as a time to find other channels beyond Facebook and Google.

So when you look at how that is impacting Bustle’s business, has it returned to pre-COVID levels?

For us, when we reflect upon the year 2020, we see that we had a great first quarter, we see that we’re having an incredible fourth quarter, and we have a big, epic crater in the second and third quarters. So when we look at the year, we basically have to say to ourselves, if it were not for that crater in the second and third quarters, what would this year have looked like? We would have had revenue well in excess of $100 million. Now, we’re gonna have revenue a little bit under $100 million.

But when we think about how we prepare for 2021 and set goals for 2021, we have to set goals for 2021 as though COVID had never happened, we have to set goals for 2021 without using Q2 and Q3 as a sort of excuse for lowering expectations. Because the fourth quarter, the quarter we’re currently in, has exceeded our wildest expectations.

People sort of sat up and took notice of the company because you had a pretty aggressive acquisition strategy. I imagine that strategy had to change a little bit in 2020. To what extent do you feel that ambition is something that you can pick up again?

So to be clear, not only do we feel great about our strategy, our strategy was critical in helping our company survive and ultimately thrive in the wake of the virus. You know, we made two acquisitions [in 2019] — in the science and technology category, we bought Inverse, which is a science and technology publication, and then Josh Topolsky launched a tech-and-gadget publication for us called Input Magazine that’s growing very quickly.

It’s critical that we had that strategy, because no single advertiser category has performed better for us in 2020 than tech — we more than tripled our revenue from technology clients this year, because technology has thrived through COVID. Had we not had an acquisition strategy, had we not diversified into tech media publishing, we certainly would not have had the outcome we had in 2020. That’s just the reality.

Categories like beauty, fashion, retail were very hard hit. Those have traditionally been our bread and butter, and they’re going to be great again, in 2021. But this spring, beauty companies weren’t doing so well, because people weren’t leaving the house. So the strategy worked, in part, because we diversified the categories in which we created content, which allowed us to diversify the advertiser base. And we’re gonna continue full speed ahead in 2021.

Now, you know, we did six acquisitions in 2019. I don’t know if we’ll do six acquisitions in 2021. But I want to do a lot more than one acquisition in 2021.

Before yesterdayYour RSS feeds

‘Brand tech’ company You & Mr. Jones adds $60M to its Series B

By Anthony Ha

You & Mr. Jones announced today that it has added $60 million in new funding from Merian Chrysalis, bringing the Series B round announced in December to a total of $260 million.

The round values the company at $1.36 billion, post-money.

You & Mr. Jones takes its name from CEO David Jones, who founded the company in 2015. After having served as the CEO of ad giant Havas, Jones told me that his goal in starting what he called “a brand tech group” was to provide marketers with something that neither traditional agencies nor technology companies could give them.

“At that moment, the choices were to go work with an agency group, which is great at brand and marketing, but they don’t understand tech, or with a tech company, which will only ever recommend their platform and don’t have the same [brand and marketing] expertise,” he said.

So You & Mr. Jones has built its own technology platform to help marketers with their digital, mobile and e-commerce needs, while also investing in companies like Pinterest and Niantic. And it makes acquisitions — last year, for example, it bought influencer marketing company Collectively.

You & Mr. Jones has grown to 3,000 employees, and its clients include Unilever, Accenture, Google, Adidas, Marriott and Microsoft. In fact, Jones said that as of the third quarter of 2020, its net revenue had grown 27% year over year.

That’s particularly impressive given the impact of the pandemic on ad spending, but Jones said that’s one of the key distinctions between digital advertising and the broader brand tech category, which he said has grown steadily, even during the pandemic, and which also sets the company apart from agencies that are “digital and tech in press release only.”

“We’re not an ad agency, we’ll never acquire agencies,” he said. “We have the technology platform, process and people to deliver all of your end-to-end, always-on content — social, digital, e-commerce and community management.”

In addition to the funding, the company is announcing that it has hired Paulette Forte, who was previously senior director of human services at the NBA, as its first chief people officer.

“The brand tech category didn’t even exist before You & Mr Jones was established,” Forte said in a statement. “The company became a true industry disruptor in short order, and growth has been swift. In order to keep up with the momentum, it’s critical to have systems in place that help talent develop their skills, encourage diversity and creativity, and find pathways to improving workflow. I am excited to join the leadership team to drive this crucial work forward.”

These 6 browser extensions will protect your privacy online

By Zack Whittaker

The internet is not a private place. Ads try to learn as much about you to sell your information to the highest bidder. Emails know when you open them and which links you click. And some of the biggest internet snoops, like Facebook and Amazon, follow you from site to site as you browse the web.

But it doesn’t have to be like that. We’ve tried and tested six browser extensions that will immediately improve your privacy online by blocking most of the invisible ads and trackers.

These extensions won’t block every kind of snooping, but they will vastly reduce your exposure to most of the efforts to track your internet activity. You might not care that advertisers collect your data to learn your tastes and interests to serve you targeted ads. But you might care that these ad giants can see which medical conditions you’re looking up and what private purchases you’re making.

By blocking these hidden trackers from loading, websites can’t collect as much information about you. Plus by dropping the unnecessary bulk, some websites will load faster. The tradeoff is that some websites might not load properly or refuse to let you in if you don’t let them track you. You can toggle the extensions on and off as needed, or you could ask yourself if the website was that good to begin with and could you not just find what you were looking for somewhere else?

HTTPS Everywhere

We’re pretty much hardwired to look for that little green lock in our browser to tell us a website was loaded over an HTTPS-encrypted connection. That means the websites you open haven’t been hijacked or modified by an attacker before it loaded and that anything you submit to that website can’t be seen by anyone other than the website. HTTPS Everywhere is a browser extension made by the non-profit internet group the Electronic Frontier Foundation that automatically loads websites over HTTPS where it’s offered, and allows you to block the minority of websites that don’t support HTTPS. The extension is supported by most browsers, including Chrome, Firefox, Edge, and Opera.

Privacy Badger

Another extension developed by the EFF, Privacy Badger is one of the best all-in-one extensions for blocking invisible third-party trackers on websites. This extension looks at all the components of a web page and learns which ones track you from website to website, and then blocks them from loading in the browser. Privacy Badger also learns as you travel the web, so it gets better over time. And it requires no effort or configuration to work, just install it and leave it to it. The extension is available on most major browsers.

uBlock Origin

Ads are what keeps the internet free, but often at the expense of your personal information. Ads try to learn as much about you — usually by watching your browsing activity and following you across the web — so that they can target you with ads you’re more likely to click on. Ad blockers stop them in their tracks by blocking ads from loading, but also the tracking code that comes with it.

uBlock Origin is a lightweight, simple but effective, and widely trusted ad blocker used by millions of people, but it also has a ton of granularity and customizability for the more advanced user. (Be careful with impersonators: there are plenty of ad blockers that aren’t as trusted that use a similar name.) And if you feel bad about the sites that rely on ads for revenue (including us!), consider a subscription to the site instead. After all, a free web that relies on ad tracking to make money is what got us into this privacy nightmare to begin with.

uBlock Origin works in Chrome, Firefox, and Edge and the extension is open source so anyone can look at how it works.

PixelBlock & ClearURLs

If you thought hidden trackers in websites were bad, wait until you learn about what’s lurking in your emails. Most emails from brand names come with tiny, often invisible pixels that alerts the sender when you’ve opened them. PixelBlock is a simple extension for Chrome browsers that simply blocks these hidden email open trackers from loading and working. Every time it detects a tracker, it displays a small red eye in your inbox so you know.

Most of these same emails also come with tracking links that alerts the sender which links you click. ClearURLs, available for Chrome, Firefox and Edge, sits in your browser and silently removes the tracking junk from every link in your browser and your inbox. That means ClearURLs needs more access to your browser’s data than most of these extensions, but its makers explain why in the documentation.

Firefox Multi-Account Containers

And an honorary mention for Firefox users, who can take advantage of Multi-Account Containers, built by the browser maker itself to help you isolate your browsing activity. That means you can have one container full of your work tabs in your browser, and another container with all of your personal tabs, saving you from having to use multiple browsers. Containers also keep your private personal browsing separate from your work browsing activity. It also means you can put sites like Facebook or Google in a container, making it far more difficult for them to see which websites you visit and understand your tastes and interests. Containers are easy to use and customizable.

You’ll never believe what this email thread says about the ad-funded ‘open’ web

By Natasha Lomas

Among a number of claims on U.K. adtech lobby group MOW’s website is the canonical biggie that “Advertising funds the open web.”

This coalition of “marketers,” whose members are not being made public despite its sweeping claims to love web openness — lest, MOW says, Google rain down punishment upon its ranks of “top companies from across the globe” — recently complained to the U.K.’s competition regulator about the tech giant’s plan to end support for tracking cookies.

If you didn’t already guess it the “OW” in MOW’s acronym stands for “Open Web.” Aka (unknown) Marketers for an Open Web.

And today the CMA duly announced it is investigating Mountain View’s “Privacy Sandbox.” Though, as yet, no conclusions have been reached on whether Google’s plan threatens competition.

In truth, a variety of business models support open access to information on the internet.

Wikipedia, for example — surely the canonical example of the open web — relies upon reader donations to keep the lights on as a not-for-profit.

While — on the “exclusive access” side — crowdfunding sites like Patreon and the subscription platform Substack offer tools for creators to solicit regular monetary subscriptions from fans and backers to unlock gated content.

But it’s instructive to note how many online publishers have shifted, year over year, from free (ad-supported) access to content to selling subscriptions for (paywalled) content, often in addition to running ads.

Whether it’s the Financial Times, the New York Times, the Telegraph or Business Insider, the list of pay-to-access news sites keeps getting longer. Much like the consent flows that (also) pop up asking to process visitors’ information in order to target them with ads.

TechCrunch joined the ranks of subscription publications almost two years ago when we launched Extra Crunch. The main TC site continues to be free to access supported by ads and our events business. (NB: In 2021 our events are going fully virtual — which means, as a brief, bonus aside, they’ve never been so open and accessible!)

So how come all these paywalls are being thrown up if advertising funds the open web, as MOW claims?

The concise answer is that digital advertising pays publishers so poorly it can’t support producing quality content at the required scale on its own — thanks to myriad adtech intermediaries, click fraud and the big two: Google and Facebook; aka, the adtech duopoly, who take the lion’s share of revenue generated by digital advertising. 

“We have found that intermediaries (the largest of which is Google) capture at least 35% of the value of advertising bought from newspapers and other content providers in the U.K.,” the CMA reported last summer, in a major market study.

Consumers turning to ad blockers to escape creepy ads and prevent privacy-hostile trackers from keeping real-time tabs on their digital activity and systematically passing this intel to scores of unknowns in an ad auction process that the U.K.’s own data protection regulator has said isn’t very lawful, is another relevant factor here.

Online advertising certainly funds something. But is that something the open web? That looks rather debatable at this point.

I bring all this up merely to provide context for a chance detail in the MOW story that I want to share — as it illustrates some of the issues in this high stakes tug-of-war between publishers, digital marketing and adtech players and a handful of big (ad)tech versus the poor, frustrated eyeballs of the average internet user.

It’s an important power struggle.

One which threatens to keep steamrollering internet users’ right to protect their personal information from exploitation (and wider security-related risks) by, in the latest twist, co-opting competition regulators to erect barriers to pro-privacy reform. Assuming, that is, the CMA ends up naively swallowing dubious claims about what advertising does for the “open” internet — when evidence of what it actually does is but a click and a paywall/tortuously long consent to “share” your private data with hundreds of unknown firms away.

The regulator’s announcement today suggests it’s alive to the dysfunction surrounding internet users’ privacy and will take more than a superficial look at that issue — though if the ICO is the main rep in the room batting for users’ interests here that’s suboptimal, to say the least, given the latter’s storied reluctance to enforce the actual law against adtech.

But here’s the tidbit — which comes by way of a PR agency working for MOW. Earlier today it CC’d me into an email thread in which several staffers had been discussing monitoring the CMA news on behalf of its client.

I’m not naming the agency or any of the individuals involved to spare their blushes but in the thread — which begins with “FYI — The CMA are just about to announce a formal investigation into Google. We’ve drafted a comment which we will be circulating shortly” — staff can be seen asking to share logins to a number of newspaper websites and/or start a free trial in order to access newspaper copy for free, i.e., without having to pay for new subscriptions. 

“Do we have an FT login? If so, could you get hte [sic] story they’ve just written on MOW off for me?” asks one staffer.

Shortly afterward there’s a discussion about starting a free trial on the Telegraph’s website as they talk about collating relevant coverage into a single document to be able to monitor developments for MOW.

One staffer chips in to warn “you need to put credit card details in to start a trial” — before suggesting the other has a go “to see if you find a way around it.”

This person follows up by saying they’ll “let you know if I manage to find a way around it.”

So, mmm, irony much?

Redacted screengrab showing part of an email thread in which MOW’s PR agency discusses how to access newspaper sites to access copy to collate coverage on behalf of their client. Image Credits: TechCrunch.

In light of MOW’s advocacy for a “vibrant” ad-supported open web — which its website implies is aligned with the interests of publishers, marketers and adtech providers alike, i.e., not just with opaque adtech interests — it seems pretty relevant that an agency working for the industry group is uninterested, to put it politely, in paying for relevant newspaper content while being paid to lobby on adtech’s behalf.

On its website MOW argues that letting Google switch off third-party tracking cookies will be bad news for publishers because it says it will cut off marketers’ ability to measure ad campaign performance across different sites — claiming that will result in less effective ads that yield a lower return and thus less cash remitted by marketers to publishers.

However the CMA’s recent deep dive study of the digital marketing sector found an industry so opaque and riddled with black box algorithms that the regulator listed “lack of transparency” itself as a competition concern.

“Platforms with market power have the incentive and ability to increase prices, for example, or to overstate the quality and effectiveness of their advertising inventory,” it warned in the report. “They can take steps to reduce the degree of transparency in digital advertising markets, reducing other publishers’ ability to demonstrate the effectiveness of their advertising and forcing advertisers to rely on information and metrics provided by those platforms. And the lack of transparency undermines the ability of market participants to make the informed decisions necessary to drive competition. The upshot of all of these issues is that competition is weakened and trust in the market is eroded.”

Given that overarching assessment, who would take an opaque coalition of marketers’ word for it that current-gen cookie tracking of the entire internet yields irreplaceably valuable performance metrics?

Or that such privacy-hostile tracking is the only viable way to support a “vibrant open web”?

“The lack of transparency is particularly severe in the open display market where publishers and advertisers rely on intermediaries to manage the process of real-time bidding and ad serving but cannot observe directly what the intermediaries are doing or, in some cases, how much they are being charged,” the CMA goes on, sharpening its concerns about the extent of the obfuscation that cloaks the practices of adtech middlemen. “Market participants such as newspapers and advertisers typically do not have visibility of the fees charged along the entire supply chain and this limits their ability to make optimal choices on how to buy or to sell inventory, reducing competition among intermediaries.”

One thing is clear: The adtech industry needs a whole lot of disinfecting sunlight to be shone in. And that clarification process will surely demand substantial reform.

Refusing to change how things are done by claiming there’s simply no other way to preserve the web “as we know it” is as ridiculous an idea as it is anti-innovation in sentiment.

Returning to the misfired email thread, we contacted MOW’s PR agency to ask whether or not the account includes expenses for relevant newspaper subscriptions. It told us these would come out of a central agency fund. Additionally — having checked back on it — the agency said it did in fact have subscriptions to the newspaper sites in question.

The spokesperson explained that the staffers involved just hadn’t realized at the time — in the heat of the “day-to-day PR” moment (and whilst wrangling remote-working-impacted comms). And, presumably, as all those subscription login screens threw up barriers to accessing the content they needed in the heat of the moment.

This (senior) spokesperson blamed themselves for what they described as a “cock up” — including the soliciting of a “paywall workaround” — going on to take full mea culpa responsibility and emphasizing it had nothing to do with MOW or with the MOW account.

But, well, if an agency working for an adtech lobby group whose key claim is that “ads support the open internet” is unable to access the online content they need to do their job without a subscription, what does that tell us about how much of an open internet the advertising industry is actually funding right now?

Google’s plan to replace tracking cookies goes under UK antitrust probe

By Natasha Lomas

Google’s plan to end support for third party cookies in the Chrome browser and its Chromium engine is under investigation by the UK’s Competition and Markets Authority (CMA).

The antitrust regulator said today that it’s launched a probe under Chapter II of the UK’s Competition Act 1998 into “suspected breaches of competition law by Google”.

The move follows a complaint lodged in November by a coalition of digital marketing companies which urged the CMA to block Google’s implementation of the self-styled ‘Privacy Sandbox’.

The CMA also received complaints from newspapers and technology companies alleging the tech giant is abusing a dominance position, it added.

A Google spokesperson sent this statement in response to a request for comment on the CMA investigation:

Creating a more private web, while also enabling the publishers and advertisers who support the free and open internet, requires the industry to make major changes to the way digital advertising works. The Privacy Sandbox has been an open initiative since the beginning and we welcome the CMA’s involvement as we work to develop new proposals to underpin a healthy, ad-supported web without third-party cookies.

Google had previously said it would implement the Sandbox in 2021 — accelerating an earlier timeline for the phasing out of third party cookies and sending ripples of fear (and loathing) through an adtech industry that bet the farm on mass surveillance of Internet users.

No changes have been made so far, according to Google.

It also said today that any changes will not be made before 2022 — as it continues a process of public collaboration (now coupled with close regulatory engagement, via the CMA) on how to replace tracking cookies.

With the looming demise of third party cookies, digital marketers are concerned about their ability to target ads at web users as browsers decommission support for key tracking technologies.

But it’s worth noting that Google’s Chrome is actually the laggard in proposing to pull the plug on tracking cookies; WebKit, which underpins Safari, announced a tracking prevention policy back in 2019 — taking inspiration from Mozilla’s earlier anti-tracking stance. (The latter made third party cookie blocking in Firefox the default in September of the same year.)

These anti-tracking plays by browser-makers are, on one level, a response to consumer distaste over creepy ads and concern for their online privacy.

And in the European Union at least, many core elements of adtech infrastructure are subject to complaints and remain under regulatory scrutiny. (Albeit, the UK’s data protection regulator, the ICO, is currently being sued for failing to act on complaints about the lawfulness of real-time bidding which date back to September 2018.)

But the contention by the marketing, publishing and adtech businesses which are crying foul over the end of cookies is that tech giants — Google in this case — are using privacy as a convenient excuse to increase their market power (and control over user data) at smaller entities’ expense.

“The investigation will assess whether the proposals could cause advertising spend to become even more concentrated on Google’s ecosystem at the expense of its competitors,” the CMA writes in a press release announcing its investigation. “It follows complaints of anticompetitive behaviour and requests for the CMA to ensure that Google develops its proposals in a way that does not distort competition.”

The announcement also makes clear that the regulator is alive to the genuine issue of privacy concern — with the CMA writing that it’s been “considering how best to address legitimate privacy concerns without distorting competition”. This has included holding discussions with the Information Commissioner’s Office (ICO), and talking to Google to “better understand its proposals”, it says.

“The current investigation will provide a framework for the continuation of this work, and, potentially, a legal basis for any solution that emerges,” the CMA adds.

Exactly what will replace tracking cookies is still very much up in the air.

Google has made a number of proposals, via the W3C standards forum, including one called ‘Dovekey’ which suggests using a key value server and which Google says builds on the feedback and proposal from adtech firm Criteo’s Sparrow proposal.

It’s also shared the algorithms for its Federated Learning of Cohorts (FLoC) proposal — referring to a suggestion to use a specific machine learning technique to allow behavioral ad targeting to continue (but without needing to collect individuals’ data).

The wider adtech industry, meanwhile, has also been coming up with various ideas and offers for replacing tracking cookies. Such as the UnifiedOpen ID 2.0 proposal (that’s being built by The Trade Desk) and proposes a centralized system for tracking Internet users based on personal data such as an email address or phone number; or the Unified ID service launched by TechCrunch’s parent Verizon Media (leveraging its access to first party data), to name just two.

So whatever replaces tracking cookies looks unlikely to be simple or singular. Not least given the formal regulatory dimension that’s now been added to Google’s mix.

With its Sandbox project underway but no replacement for tracking cookies yet selected the CMA’s intervention certainly looks very strategic — giving the UK regulator a (potentially major) role in influencing the future shape of adtech.

Although it could also lead to regulatory divergence for adtech in the UK vs the European Union, where the Commission’s antitrust regulators have also been eyeing Google’s adtech practices but have not yet launched a formal investigation — depending on the outcome of any probe/intervention there.

Back in the UK, a recent CMA market study of the digital advertising sector led it to report substantial concerns over the power of the Google-Facebook adtech duopoly — and it sought views on breaking up the tech giants — although in its final report it deferred any competitive intervention in favor of waiting for the government to legislate.

Since then UK ministers have unveiled a plan to establish a pro-competition regulatory regime that will include a new statutory code of conduct, overseen by a Digital Market Unit (to be set up this year), with the aim of putting some hard limits on big (ad)tech — including potentially requiring them to offer users an opt out from behavioral advertising (something Facebook, for example, currently does not).

Facebook will turn all US political advertising off again after Georgia runoffs

By Taylor Hatmaker

Georgia is the only state in the U.S. right now where Facebook allows political ads to run, but after Tuesday’s polls close that’s set to change.

According to Facebook’s site detailing changes to its ad policies and a story from Axios, the company will no longer allow political and social issue ads anywhere in the country, Georgia included, beginning early tomorrow.

Facebook told TechCrunch that the decision to toggle political ads in Georgia off again brings that state in line with its current “nationwide pause” on social issue, election and politics ads. A Facebook spokesperson declined to say when political ads will again be allowed or if permanently blocking them from the platform is under consideration.

The company first hit pause on those ad categories November 4 as a precaution designed to reduce misinformation in the U.S. presidential election. On December 16, the company re-allowed political ads in Georgia, inviting eager campaigns to pay to get their messages in front of Facebook users. It appears that some politicians, Sen. Ted Cruz (R-TX) among them, pounced on Facebook’s Georgia loophole to raise money for themselves in spite of restrictions.

When political ads came flooding back in for Georgians, they edged out mainstream news sources, according to new reporting from The Markup. While that result is fairly intuitive, it does underline the outsized influence of targeting political advertising in Facebook’s information ecosystem.

Plenty of politicians and political groups are likely eager to get back to fundraising on Facebook. The company’s decision to keep the pause in place suggests that it’s still evaluating how — and perhaps if — it wants to handle political ads in the future. But Facebook also might be waiting for the storm to pass in light of the misinformation that plagued November’s drawn-out process of calculating election results.

It’s also worth noting that Facebook’s head of advertising integrity Rob Leathern left the company at the end of December, calling his team’s work on the 2020 U.S. election the “culmination of a huge amount of effort over several years.” Leathern helped sculpt the company’s policies around political advertising — decisions that were often controversial due to the prevalence of paid misinformation sweeping through the platform throughout 2020.

Because they will decide control of the Senate, the unusual pair of runoff races in a state that just flipped blue are high-stakes for both political parties. With a Democratic Senate, the Biden administration’s ambitious plans for things like COVID relief and the climate crisis will have a much better shot at becoming a reality. And for Republicans looking to stymie the president-elect’s policy priorities, extended control of the Senate would put a powerful barrier in Biden’s way.

 

Apple takes aim at adtech hysteria over iOS app tracking change

By Natasha Lomas

Apple has used a speech to European lawmakers and privacy regulators today to come out jabbing at what SVP Craig Federighi described as dramatic, “outlandish” and “false” claims being made by the adtech industry over a forthcoming change to iOS that will give users the ability to decline app tracking. 

The iPhone maker had been due to introduce the major privacy enhancement to the App Store this fall but delayed until early 2021 after the plan drew fire from advertising giants.

Facebook, for example, warned the move could have a major impact on app makers which rely on its in-app advertising network to monetize on iOS, as well as some impact on its own bottom line.

Since then four online advertising lobby groups have filed an antitrust complaint against Apple in France — seeking to derail the privacy changes on competition grounds.

However Apple made it clear today that it’s not backing down.

Federighi described online tracking as privacy’s “biggest” challenge — saying its forthcoming App Tracking Transparency (ATT) feature represents “the front line of user privacy” as far as it’s concerned.

“Never before has the right to privacy — the right to keep personal data under your own control — been under assault like it is today. As external threats to privacy continue to evolve, our work to counter them must, too,” he said in the speech to the European Data Protection & Privacy Conference.

The aim of ATT is “to empower our users to decide when or if they want to allow an app to track them in a way that could be shared across other companies’ apps or websites”, according to Federighi.

Civic society’s objection to the adtech industry’s tracking ‘dark art’ is that it sums to hellishly opaque mass surveillance of the mainstream Internet.

While harms attached to the practice include the risk of discrimination; manipulation of vulnerable groups; and election interference, to name a few.

Federighi took clear aim in his own attack — returning to a descriptor that Apple’s CEO Tim Cook used in a speech to an earlier European privacy conference back in 2018.

“The mass centralization of data puts privacy at risk — no matter who’s collecting it and what their intentions might be,” he warned. “So we believe Apple should have as little data about our customers as possible. Now, others take the opposite approach.

“They gather, sell, and hoard as much of your personal information as they can. The result is a data-industrial complex, where shadowy actors work to infiltrate the most intimate parts of your life and exploit whatever they can find — whether to sell you something, to radicalize your views, or worse.”

Since Cook wooed EU lawmakers by denouncing the “data-industrial complex” — and simultaneously lauding Europe’s pro-privacy approach to digital regulation — scores of individual and collective complaints have been lodged against the adtech infrastructure that underpins behavioral advertising under the EU’s General Data Protection Regulation (GDPR).

Yet regional regulators still haven’t taken any enforcement action over these adtech complaints. Turning the cookie-tracking tanker clearly isn’t a cake walk.

And while the adtech lobby may have been heartened by remarks made yesterday by Commission EVP and competition chief, Margrethe Vestager — who told the OECD Global Competition Forum that antitrust enforcers should be “vigilant so that privacy is not used as a shield against competition” — there was a sting in the tail as she expressed support for a ‘superprofiling’ case against Facebook in Germany, which combines the streams of privacy and competition in new and interesting ways, with Vestager dubbing the piece of regulatory innovation “inspiring and interesting”.

Federighi urged Europe’s lawmakers to screw their courage to the sticking place where privacy is concerned.

“Through GDPR and other policies — many of which have been implemented by Commissioner Jourová, Commissioner Reynders, and others here with us today — Europe has shown the world what a privacy-friendly future could look like,” he said, lathering on the kind of ‘geopolitical influencer’ praise that’s particularly cherished in Brussels.

He also reiterated Apple’s support for a GDPR-style “omnibus privacy law in the U.S.” — something Cook called for two years ago — aka: a law that “empowers consumers to minimize collection of their data; to know when and why it is being collected; to access, correct, or delete that data; and to know that it is truly secure”.

“It’s already clear that some companies are going to do everything they can to stop [ATT] — or any innovation like it — and to maintain their unfettered access to people’s data. Some have already begun to make outlandish claims, like saying that ATT — which helps users control when they’re tracked — will somehow lead to greater privacy invasions,” he went on, taking further sideswipes at Apple’s adtech detractors.

“To say that we’re skeptical of those claims would be an understatement. But that won’t stop these companies from making false arguments to get what they want. We need the world to see those arguments for what they are: a brazen attempt to maintain the privacy-invasive status quo.”

In another direct appeal to EU lawmakers, Federighi suggested ATT “reflects both the spirit and the requirements of both the ePrivacy Directive, and the planned updates in the draft ePrivacy Regulation” — displaying a keen insight into the (oftentimes fraught) process of EU policymaking. (The ePrivacy update has in fact been stalled for years — so the subtle suggestion in Apple’s appeal is its technology levers being flipped to enable greater user privacy could help unblock the EU’s bunged up policy levers.)

“ATT, like ePrivacy, is about giving people the power to make informed choices about what happens to their data. I hope that the lawmakers, regulators, and privacy advocates here today will continue to stand up for strong privacy protections like these,” he added.

Earlier in the speech Federighi also made some plainer points: Likening ATT to the Intelligent Tracking Prevention (ITP) feature Apple added to its Safari browser back in 2017 — pointing out that despite similar objections from adtech then the industry as a whole has posted revenue increases every year since.

“Just as with ITP, some in the ad industry are lobbying against these efforts — claiming that ATT will dramatically hurt ad-supported businesses. But we expect that the industry will adapt as it did before — providing effective advertising, but this time without invasive tracking,” he said.

“Of course, some advertisers and tech companies would prefer that ATT is never implemented at all. When invasive tracking is your business model, you tend not to welcome transparency and customer choice,” he added, taking another swipe at the industry’s motives for objecting to more choice and privacy for iOS users.

At the same time Federighi did acknowledge that the iOS switch to requiring user permission for app tracking “is a big change from the world we live in now”.

Of course it’s one that will likely bring transitionary pain to iOS developers, too.

But on this his messaging stood firm: He made it clear Apple may wield the stick at developers who don’t get with its user privacy upgrade program, warning: “Early next year, we’ll begin requiring all apps that want to do that to obtain their users’ explicit permission, and developers who fail to meet that standard can have their apps taken down from the App Store.”

It was interesting to note that the speech contained both specific appeals to regional lawmakers to stay the course in regulating to protect data and privacy; and more amorphous appeals to (unnamed) competitors — to follow Apple’s lead and innovate around privacy.

But if you’re a tech giant being accused of anti-competitive behaviour by a self-interested adtech clique, framing your desire for increased competition in the (lucrative) business of enhancing user privacy is a nice rebuttal.

“We don’t define success as standing alone. When it comes to privacy protections, we’re very happy to see our competitors copy our work, or develop innovative privacy features of their own that we can learn from,” said Federighi.

“At Apple, we are passionate advocates for privacy protections for all users. We love to see people buy our products. But we would also love to see robust competition among companies for the best, the strongest, and the most empowering privacy features.”

The Apple SVP also took gentle aim at any EU policymakers who may be imagining it’s a clever idea to crack open the pandora’s box of end-to-end encryption — urging them to strengthen the bloc’s commitment to robust security. Duh.

The backstory here is there’s been some recent chatter around the topic. Last monthdraft resolution made by the Council of the European Union triggered press coverage that suggested EU legislators are on the cusp of banning e2e encryption.

Although, to be fair, the only ‘b’ word the Commission has used so far is ‘balanced’ — when it said its new EU security strategy will “explore and support balanced technical, operational and legal solutions, and promote an approach which both maintains the effectiveness of encryption in protecting privacy and security of communications, while providing an effective response to serious crime and terrorism”.

“I also hope that you will strengthen Europe’s support for end-to-end encryption. Apple strongly supported the European Parliament when it proposed a requirement that the ePrivacy Regulation support end-to-end encryption, and we will continue to do so,” Federighi added, tone set to ‘don’t disappoint’.

Nielsen plans to combine traditional and digital TV ratings

By Anthony Ha

Nielsen is updating its TV ratings to reflect a world which audiences are watching TV both live and on-demand, across a variety of different streaming services and devices.

While the firm has long provided the standard measure for TV audiences, things are more fragmented when it comes to digital viewing. So the upcoming Nielsen One platform isn’t just another digital measurement product — it’s an update to Nielsen’s core metrics.

“Our main objective is, we want measurement to be no longer be a barrier to cross-media [ad] buying,” said Scott Brown, Nielsen’s general manager of audience measurement.

So when Nielsen One launches in fall 2022, the numbers that Nielsen reports about a TV program’s viewership should reflect the true size of the audience, not just the number of people watching on traditionally.

And given the online world’s programmatic ad-buying, as well as similar tools beginning to expand into linear traditional TV, Brown said it’s also time to abandon the idea that “everybody sees the same ads.”

That means the platform will be “moving away from” Nielsen’s C3 and C7 ratings, which are supposed to measure how many people saw a TV program’s ads within three and seven days of airing, respectively. Brown said Nielsen One will be much more granular, measuring how many people saw each ad across different platforms: “Each individual advertisement will get an audience estimate number,” with the goal of fully abandoning the older metrics by fall 2024.

Nielsen One

Image Credits: Nielsen

The Nielsen One launch will also include what Brown called a “new data backbone,” allowing the firm’s clients to get more direct access to the data that Nielsen uses to report these numbers.

To offer this data, Nielsen will continue relying on the panels that it uses to create its existing TV ratings, except Brown said the data will now be “truly cross-platform.” The firm will be drawing additional data from its partners, who already include Amazon, Hulu, Roku, Vizio and Google/YouTube.

Brown suggested that with many networks and media companies launching or acquiring streaming services of their own, all of them should want to work with Nielsen to validate their viewership and ads — though some, like Netflix and Disney+, have less of an incentive since their business models rely on subscriptions, not ads.

“Everyone will be measured,” he said. “The ones that lean in and do an integration with us will get more granular measurement and more comprehensive coverage.”

I also brought up one of the big debates in the online world: With Facebook counting three seconds of viewing time as a video play, while Netflix focuses on viewers who “chose to watch” at least two minutes of a show, what actually constitutes an impression?

“We don’t have a final answer in terms of, this is what we’re rolling out,” Brown said. Instead, Nielsen plans to create a working group to hash this out next year. And in the meantime, it’s building technology that will “measure on a second-by-second level of granularity,” allowing the platform to support whatever the final rule might be.

“Today’s fragmented measurement landscape makes planning, implementing, and validating cross-platform campaigns overly complex and increasingly less predictable,” said Adam Gerber, chief media officer at the agency Essence, in a statement. “As we shift to addressable models, prioritize reach, and optimize to outcomes, it’s critical that we develop and adopt consistent, single-source measurement solutions. Nielsen’s new cross-media approach is an important step in delivering the confidence and transparency that advertisers require to support holistic campaigns.”

Boost ROI with intent data and personalized multichannel marketing campaigns

By Walter Thompson

Coronavirus is causing large and small businesses to drastically cut marketing budgets. In Forrester’s self-described “most optimistic scenario,” the analysts project a 28% drop in U.S. marketing spend by the end of 2021. Even Google is cutting its marketing budget in half. As marketers move forward, Forrester predicts marketing automation platforms will grow despite an overall decline in marketing technology investment.

Automation platforms help marketers scale their communications. However, scaling communications is not a substitute for intimacy, which all humans crave. Because of the pandemic, it is harder than ever to get attention, let alone make a connection. More mass email blasts from your marketing automation platform are not going to get you the connections with prospects you crave. So how should marketers proceed? Direct mail captures 100% of your audience’s attention. It provides a sensory experience for your prospects and customers, and that helps establish an emotional connection.

Winning marketers are strategically merging automation and digital data with the more intimate channel of direct mail. We call this tactile marketing automation (TMA).

TMA is the integration of direct mail or personalized swag with a marketing automation platform. With TMA, a marketer doesn’t have to think about creating direct mail campaigns outside of digital campaigns. Rather, direct mail experiences are already fully integrated into the pre-built customer journey.

TMA uses intent data to inform content, messaging and the timing of direct mail touchpoints that maximize relevancy and scalability. Multichannel campaigns including direct mail report an ROI 18 percentage points higher than those without direct mail. Plus, 84% of marketers state direct mail improves multichannel campaign performance.

Read on to see how you can merge digital communications and direct mail to deliver remarkable experiences that spark a connection.

Incorporate intent data

Personalization is a key ingredient of a remarkable experience. Many marketers automate processes by introducing marketing software and then call it personalization. But, oftentimes it’s just quicker batching and blasting. Brands can’t just change the first name on a piece of content and call it “personalized.” Real personalization is necessary and vital for real results. Our consumers expect more. The best way to introduce real personalization within a marketing mix is to use intent data and trigger-driven campaigns.

Facebook’s latest ad tool fail puts another dent in its reputation

By Natasha Lomas

Reset yer counters: Facebook has had to ‘fess up to yet another major ad reporting fail.

This one looks like it could be costly for the tech giant to put right — not least because it’s another dent in its reputation for self-reporting. (For past Facebook ad metric errors check out our reports from 2016 here, here, here and here.)

AdExchanger reported on the code error last week with Facebook’s free “conversion lift” tool, which it said affected several thousand advertisers.

The discovery of the flaw has since led the tech giant to offer some advertisers millions of dollars in credits, per reports this week, to compensate for miscalculating the number of sales derived from ad impressions (which is, in turn, likely to have influenced how much advertisers spent on its digital snake oil).

According to an AdAge report yesterday, which quotes industry sources, the level of compensation Facebook is offering varies depending on the advertiser’s spend — but in some instances the mistake means advertisers are being given coupons worth tens of millions of dollars.

The issue with the tool went unfixed for as long as 12 months, with the problem persisting between August 2019 and August 2020, according to reports.

The Wall Street Journal says Facebook quietly told advertisers this month about the technical problem with its calculation of the efficacy of their ad campaigns, skewing data advertisers use to determine how much to spend on its platform.

One digital agency source told the WSJ the issue particularly affects certain categories such as retail where marketers have this year increased spending on Facebook and similar channels by up to 5% or 10% to try to recover business lost during the early stages of the pandemic.

Another of its industry sources pointed out the issue affects not just media advertisers but the tech giant’s competitors — since the tool could influence where marketers chose to spend budget (whether they spend on Facebook’s platform or elsewhere).

Last week the tech giant told AdExchanger that the bug was fixed on September 1, saying then that it was “working with impacted advertisers.”

In a subsequent statement a company spokesperson told us: “While making improvements to our measurement products, we found a technical issue that impacted some conversion lift tests. We’ve fixed this and are working with advertisers that have impacted studies.”

Facebook did not respond to a request to confirm whether some impacted advertisers are being offered millions of dollars worth of ad vouchers to rectify its code error.

It did confirm it’s offering one-time credits to advertisers who have been “meaningfully” impacted by the issue with the (nonbillable) metric, adding that the impact is on a case-by-case basis, depending on how the tool was used.

Nor did it confirm how many advertisers had impacted studies as a result of the year-long technical glitch — claiming it’s a small number.

While the tech giant can continue to run its own reporting systems for B2B customers free from external oversight for now, regulating the fairness and transparency of powerful internet platforms that other businesses depend upon for market access and reach is a key aim of a major forthcoming digital services legislative overhaul in the European Union.

Under the Digital Services Act and Digital Markets Act plan, the European Commission has said tech giants will be required to open up their algorithms to public oversight bodies — and will also be subject to binding transparency rules. So the clock may be ticking for Facebook’s self-serving self-reporting.

The downfall of adtech means the trust economy is here

By Walter Thompson
Richard Jones Contributor
Richard is CMO of Cheetah Digital, a cross-channel customer engagement solution provider. As an expert in zero-party data, he is committed to helping brands provide a value exchange with consumers through the lifecycle in return for consumer attention, engagement and loyalty.

2020 has brought about much-needed social movements. In June, activists launched the Stop Hate for Profit campaign, a call to hold social media companies like Facebook accountable for the hate happening on their platforms.

The idea was to pull advertising spending to wake these social platforms up. More than 1,200 businesses and nonprofits joined the movement, including brands such as The North Face, Patagonia and Verizon. I led my company, Cheetah Digital, to join alongside some of our clients like Starbucks and VF Corp.

Stop Hate for Profit highlighted social media hitting its tipping point. Twitter and Snapchat chose to stand up against hate speech, banning political ads and taking action to flag misinformation. Facebook, unfortunately, has not yet been as proactive, or at best it’s been sporadic in its response.

While many thought the movement would come and go, the reality is it has only just begun. With America conducting arguably its most divisive election in history, these problems won’t just go away. For marketers, Stop Hate for Profit is more than a social movement — it is pointing to an issue with ad tech as a whole.

I believe we are seeing the downfall of ad tech as we know it with social media boycotts and data privacy leading the charge.

The social media quagmire

In May, Forrester released a report titled “It’s OK to Break Up with Social Media” that contained statistics indicating that consumers are fed up with social media: 70% of respondents said they don’t trust social media platforms with their data. Only 14% of consumers believe the information they read on social media is trustworthy. 37% of online adults in the U.S. believe social media does more harm than good.

Here is the reality we need to get back to: Social media isn’t built for marketers to reach consumers. In the beginning of the social media craze, brands rushed to get on board and join the conversations. What many brands discovered is these channels became a platform for customer complaints not for building positive brand perception. Furthermore, the social platforms marketers flocked to as an avenue to reach customers began charging marketers just to get to the customers.

The algorithms that define what content you see unfortunately make it harder for people to see opposing views, and this more than anything else polarizes society further. If you start looking at QAnon content, very soon that’s all the algorithms feed you. You might spend more time on social platforms fueling their ad dollars, but you have also lost a grip on reality. Marketers must admit things have gone too far on social media and it is okay to move on.

Privacy matters

Imagine you are in need of a minor surgery. Perhaps you take an Uber ride to the specialist for a consultation. Next, you go get the surgery and it is successful. Soon you find yourself at home recovering and all is well. That is, until you start scrolling Facebook. Suddenly advertisements pop up for medical malpractice lawyers, but you haven’t told anyone about the surgery and you certainly didn’t post about it on social media.

Here you are, just wanting to rest and recover at home, but instead you are being bombarded by advertisements. So how did those ads get there? You left a digital footprint, your data was sold and now you’re being hit with intrusive ads. To me, this story crystallizes the abuse ad tech has been fostering in the world around us. There’s an utter invasion of privacy and consumers aren’t blind to it.

Data privacy has been a focus of conversation for marketers for several years now. Just this year, America saw the California Consumer Privacy Act (CCPA) go into effect and become enforceable. This legislation gives back control of data to the consumer. In June, Apple announced updates to make it harder for apps and publishers to track location data and use it for ad targeting. At the beginning of August, Meredith and Kroger announced a partnership to provide first-party sales data for advertising efforts in an attempt to move off of cookies. It is clear data privacy is not a fad going away anytime soon.

Where do marketers go from here?

I believe the future of marketing is the trust economy. The Stop Hate for Profit campaign, the invasion of privacy and shifting attitudes and behaviors of consumers point to the end of an era where marketers relied upon third-party data. Trust is now the most impactful economic power, not data. We conducted research earlier this year with eConsultancy, and our findings revealed that 39% of U.S. consumers don’t like personal ads driven from cookie data. People don’t want to be tracked and targeted as they click around the web. Ad tech’s roof is caving in and marketers must adjust.

The old methods of marketing won’t carry you through into the era of the trust economy. It is time to look to new channels and revisit old channels. We have to shift back to the channels where we own what is being said. Advertising on social platforms should be focused on driving consumers to owned channels where you can capture their permissions and data to connect with them directly. Consider email as a channel to focus on.

Don’t worry — it works. That same eConsultancy report found nearly three out of four consumers made a purchase in the last 12 months from an email sent by a brand or retailer and massively outperformed social ads when it came to driving sales. Similarly nine times as many U.S. consumers want to increase their participation in loyalty programs in 2020 than those that want to reduce their involvement. You have to ensure you are owning your data and loyalty programs are a treasure trove of consumer data you own. Emily Collins from Forrester does a good job of explaining why you can achieve this with a true loyalty strategy, not just a rewards program.

Your goal should be to build direct connections to consumers. Building trust means offering a value exchange for data and engagement, not going and buying it from a third-party. Fatemah Khatibloo, a principal analyst for Forrester wrote, “Zero-party data is that which a customer intentionally and proactively shares with a brand. It can include purchase intentions, personal context, and how the individual wants the brand to recognize her.” This zero-party data is foundational for the trust economy and you should check out her advice on how it helps you navigate privacy and personalization.

Take responsibility

The trust economy is really about asking yourself, as a marketer, what you stand for. How do you view your relationship with consumers? Do you care? What kind of relationship do you want? Privacy has to be part of this. Accountability is crucial. We must be accountable to where we are putting our money. It’s time to stop supporting hate, propping up the worst of society and fueling division. Start taking responsibility, caring about social issues and building meaningful relationships with consumers built on trust.

 

Metigy gets $20 million AUD to making online marketing easier for SMEs

By Catherine Shu

Metigy, a marketing platform created to help small businesses automate more of the decision making in their online ad campaigns, has raised a Series B of $20 million AUD (about $14.6 million USD). The new funding, led by returning investor Cygnet Capital, will be used to grow the Sydney, Australia-based startup’s international customer base, especially in the United States and Southeast Asia. Other participants in the round included Regal Funds Management, OC Funds, Five V Venture Capital and Thorney, plus returning

Founded in 2015, Metigy is currently used by about 26,000 businesses and has channel partnerships with Google and Optus. About 44% of its customers are in Australia and New Zealand, while 26% are in Southeast Asia, and 22% are in the United States. The startup has raised AUD $27.1 million (about USD $19.9 million) in total.

Co-founder and chief executive officer David Fairfull told TechCrunch Metigy was created because “half of SMEs fail in the first two years and marketing is one of the top two reasons for this. It’s a global issue and a paradigm that can be changed by harnessing technology.”

Fairfull and other members of Metigy’s founding team previously worked at We Are Social, a global creative agency. While there, they “spotted an opportunity to give small businesses access to the same data and strategic insights” as larger marketing teams.

Marketing platform Metigy's Command Center

Marketing platform Metigy’s Command Center

Metigy’s platform gives more support to small or inexperienced marketing teams by using real-time data from their online advertising channels to create a livestream of recommendations. For example, it will tell marketing teams if they should start posting more content right away, use more hashtags or schedule more posts. The platforms also predicts what posts will result in the most conversions, helping companies decide how to spend their advertising budget.

For example, one of Metigy’s customers, parking app Share with Oscar, used Metigy to analyze what was trending on social media when members of the Royal Family visited Sydney. As a result, Fairfull said they were able to generate 2,700 customer engagements by spending about AUD $10 (about USD $7).

Other social marketing platforms like Hootsuite and Sprout Social are “essentially process solutions that help make the marketer more efficient,” said Fairfull. “However, if you don’t understand marketing, then all this process efficiency won’t help you gain results.”

Metigy is focusing on the United States and Southeast Asia because of the large number of SMEs there. By 2022, there is expected to be 30 million SMEs in the U.S. “On top of this, success in marketing technology is often benchmarked by success in the U.S., so expanding in this region adds credibility,” Fairfull added.

But in terms of volume, Southeast Asia offers a more promising market. “The real growth opportunity for us though is in Southeast Asia, where there is expected to be 150 million SMEs across the 11 markets by 2022,” Fairfull said. But the majority of them don’t have large marketing teams or access to the kind of ad technology that larger companies do. Companies in the region also tend to be more price sensitive, Fairfull added, so artificial intelligence and machine learning-based technology helps lower the cost of software like Metigy to an attractive price.

Is the internet advertising economy about to implode?

By Danny Crichton

Advertising drives the modern digital economy. Whether it’s reading news sites like this one or perusing your social media feeds, advertising is the single most important industry that came out of the development of the web. Yet, for all the tens of billions of dollars poured into online advertising just in the United States alone, how much does that money actually do its job of changing the minds of consumers?

Tim Hwang has a contrarian stance: it doesn’t. In his new book published as a collaboration between Logic Magazine and the famed publisher Farrar, Straus and Giroux, he argues in “Subprime Attention Crisis” that the entire web is staring into an abyss of its own making. Advertising is overvalued due to the opaqueness of the market, and few actors are willing to point out that the advertising emperor has no clothes. Much like the subprime mortgage crisis, once people come to realize the true value of digital ads, the market could crater. I found the book provocative, and I wanted to chat further with Hwang about his thoughts on the market.

Hwang formerly worked at Google on policy and has developed many, many projects across a whole swath of tech-oriented policy issues. He’s currently a research fellow at Georgetown’s Center for Security and Emerging Technology.

This interview has been condensed and edited for clarity.

TechCrunch: Let’s dive straight into the book. How did you get started on this topic of the “subprime attention economy”?

Tim Hwang: There were two incidents where I was like, something is going on here. I was having conversations with a couple of friends who are product managers at Facebook, and I remember making the argument that that there’s a lot of evidence to suggest that this whole adtech thing is maybe just mostly garbage. The most interesting thing that they said was, “Oh, like, advertising works but we can’t really tell you how.” That’s like talking to someone from the national security establishment and they’re like, “Oh yeah, we can stop terrorists but, like, we can’t tell you exactly how that goes down.”

I think one thing that got me really interested in it was how opaque a lot of these things are. The companies make claims that data-driven programmatic advertising really is as effective as it is but then they’re kind of strangely hesitant to show evidence of that.

Second, I was doing research with a lot of people who I think you’d rightly call sort of tech critics — strong critics of the power that these platforms have. I think one of the most interesting things is that even among the strongest critics of tech, I think a lot of them have just bought this claim that advertising and particularly data-driven advertising is as powerful as industry says it is.

It’s a kind of strange situation. Tech optimists and tech pessimists don’t agree on a whole lot, but they do seem to agree on the idea that this sort of advertising works. That was what I wanted to explore in the book.

Why don’t we talk a bit about the thesis?

The thesis of the book is really quite simple, which is you look around and basically our modern experience of the web is almost entirely shaped by advertising. The way social media is constructed, for example, is largely as a platform for delivering ads. Engagement with content is really good for creating profiles and it’s really good for delivering ads. It really has been the thing that has powered the current generation of companies in the space.

As you sort of look closer though, it really starts to resemble the market bubbles that we know of and have seen in other places. So explicitly, the metaphor of the book is the subprime mortgage crisis. I think the idea though is that you have this market that is highly opaque, there’s a lot of evidence to suggest that the value of ads is misidentified, and you have a lot of people interested in boosting it even in spite of all that.

For the book, I wanted to look at that market and then what the internet could look like after all this. Are there other alternative business models that we want to adopt for the web going forward?

Near acquires Teemo to expand its data business into Europe

By Anthony Ha

Two companies in the data business are teaming up, with Near announcing that it has acquired French startup Teemo.

Near founder and CEO Anil Mathews told me that his company processes data around the online and offline behavior of 1.6 billion consumers each month: “We marry these two worlds and fill in the gap.”

Teemo, meanwhile, is location intelligence company based in Paris. Mathews said that Singapore-headquartered Near has been expanding “east to west,” so by acquiring Teemo, it will have a beachhead to expand throughout Europe — for example by getting direct access to the numerous big brands headquartered in Paris.

And while Mathews described Near as a company that has “from day one put privacy in the front seat,” he also suggested that Teemo has unique advantages in this area, particularly when it comes to Europe’s General Data Protection Regulation.

“Teemo is very pro-privacy,” he said. “They were the first company certified by the French Data Protection Officer as GDPR compliant.” (That certification came after it was one of the first companies to be admonished under GDPR.)

Teemo’s founder and CEO Benoit Grouchko will become Near’s chief privacy officer, and the rest of the Teemo workforce will be joining Near as well, Mathews said. Another big asset: This will give Near access to Teemo’s GDPR-compliant consumer data (which he said will be stored in European data centers and continue to be handled in fully GDPR-compliant ways).

Near could potentially expand into other markets by making similar acquisitions in the future, Mathews added.

The financial terms of the acquisition were not disclosed. Formerly known as Databerries, Teemo has raised a total of $17.9 million in funding from investors such as Index Ventures and Mosaic Ventures.

“We are very excited to join the Near family with whom we share a common DNA of technology and performance,” Grouchko said in a statement. “This will allow us to be stronger and to grow even faster, beyond the French market.”

YouTube targets music fans with new audio ad format

By Anthony Ha

YouTube is announcing new ad products today, designed to help marketers reach YouTube visitors who are doing more listening than watching.

The big addition is audio advertising. As the Google -owned video site puts it in a blog post, these are ads designed for viewers who “squeeze in a living room workout before dinner, catch up on a podcast or listen to a virtual concert on a Friday night.”

In other words, audio ads are designed for videos where audience members may only be glancing at the screen occasionally, or might ignoring the visuals altogether. To be clear, these ads won’t be audio-only, but YouTube says the audio should be doing most of the communication, while the visual side is limited to “a still image or simple animation.”

The company says that in early testing, more than 75% of audio ad campaigns on YouTube resulted in a significant lift in brand awareness. For example, this Shutterfly ad resulted in a 14% lift in ad recall and a 2% increase in favorability in its target audience.

The key, YouTube says, is that the audio has to carry the message: “Think: If I close my eyes, I can still clearly understand what this ad is about.”

In addition to launching audio ads in beta, YouTube is also announcing dynamic music lineups, allowing marketers to target their campaigns at collections of music channels on YouTube. These lineups can be focused on a genre, such as Latin music or K-pop, or on an interest like fitness.

In a separate blog post, YouTube’s Head of Music Lyor Cohen made a broader case to advertisers about why they should see YouTube as an essential music streaming platform.

After all, according to Cohen, more than 2 billion logged-in viewers are watching at least one music video each month. And, he wrote, “music is more front and center than you might think” — 60% of YouTube’s music viewing happens on mobile, where background viewing/listening is disabled.

That might seem like an odd thing to emphasize while launching an ad format better suited to background listening, but Cohen continued, “Regardless of when and how people are tuning in, we have ways to help advertisers connect, even when they’re consuming music in the background. Now you can complement the moments your consumers are watching, by engaging them in moments when they’re listening, with newly announced audio ads.”

Zeotap raises $18.5M for a customer ID platform it says was built with privacy in mind

By Ingrid Lunden

As the online world slowly moves to a more privacy-focused environment free of cookies, startups building alternative ways to help businesses manage customer identity and build marketing around that are getting attention. Zeotap, a customer identity platform built around a company’s own (first-party) data that combines this with other data sources to create more complete pictures of users and what they do, is today announcing that it has raised a further $18.5 million.

This is an extension of a Series C round for the firm coming from a single investor, SignalFire, from its Breakout Fund, reserved for growth-stage investments. Founded in Berlin with operations now out of New York, Bengaluru in India and the UK, Zeotap has now raised $60.5 million for the round, with other investors including the likes of SingTel (via Innov8), Here (the mapping company), Iris Capital, the European Investment Bank, and a number of others participating.

Zeotap is not disclosing its valuation, but PitchBook notes it was close to $158 million post-money in the first close.

Zeotap started life initially as a platform aimed at mobile usage, specifically helping carriers broker deals with third parties that wanted their customer data. Over the years this has widened and evolved to a bigger opportunity not just to exchange data, but a place to draw it all together to build more useful customer profiles.

Projjol Banerjea, founder and CPO of Zeotap (pictured above, right, with co-founder Daniel Heer, who is the CEO) said in an interview that the opportunity Zeotap is targeting has become especially urgent this year, in the wake of the global health pandemic.

“You have two companies right now,” he said. “Those that are using the current market as an opportunity to reassess marketing and drive efficiencies, and double down on streamlining their business. And those that are more resilient and seeing the current time as an opportunity to scale. Whichever category you fall in, customer data is important.”

The company is currently active in 14 markets, he said, with products aimed at publishers, brands, and data partners. Zeotap’s platform essentially covers a few key areas. First, a customer data platform based around an organization’s first party data about its own customers, which provides a unified customer view for an organization based on what it already has. “This is much harder to do than you’d expect,” Banerjea said. “Managing consent is top of mind here, while making the most of first-party assets.”

Second comes ID resolution. Zeotap claims that it hosts the largest marketing identity graph in the world, with a “network of identifiers that can locate a customer across different channels.” This can include offline phone numbers, email and home addresses, alongside browsing activity. “We can provide a bridge to the digital world for offline names,” he said, adding that Zeotap works with some 112 providers to pool data into a single, unified customer view.

These then come together in Zeotap’s universal ID+ product, which he said is “fully consent based and tokenized, with no data leakage.” This essentially is sold to clients whose marketers can then help their efforts “transit across the ecosystem without any exposure for the customer but also for any of our partners.”

A lot of the regulations that have emerged, and the reasons cookies are being depreciated, are to provide better protection for consumers, to give them better transparency around how and where their data is being used. Approaches like Zeotap’s may not completely eradicate that bigger issue — and some might argue that for the foreseeable future advertising and marketing will remain a cornerstone of how the web works — so much as create a system that makes marketing, and the big data profiling that underpins it, more secure, Banerjea explained.

“ID+ is designed for us to be able to connect the dots without exposure,” he said.

Zeotap essentially has two types of competitors at the moment, he said. Larger marketing clouds that have grown by acquisition, where a number of activities sit in silos but under one bigger umbrella; and those that have grown big businesses around the managing of customer identity, such as Liveramp (the company formerly known as Acxiom) and The Trade Desk.

But in an $87 billion industry, and at a time when having an online strategy is a do-or-die imperative, there is perhaps room for another.

“COVID-19 has catalyzed a transformation in the marketing mix as brands invest in their data and learnings to redirect traditional TV budgets to more effective channels,” said Chris Scoggins, venture partner at SignalFire, in a statement. “Our investment in Zeotap is testament to our belief in the company’s leadership, vision, and its rapidly evolving customer intelligence platform (CIP) with a built-in identity solution for the future of marketing named ID+ .”

Facebook extends its temporary ban on political ads for another month

By Taylor Hatmaker

The election is settled, but the nation is far from it.

Before Election Day in the U.S., Facebook hit pause on all political and social issue ads. At the time, the company made it clear that the precautionary measure designed to turn off one potential faucet of misinformation would be temporary, but it couldn’t say how long the policy would remain in effect.

Now, Facebook says the temporary ban will continue for at least another month. The decision to extend the special policy was implemented Wednesday, four days after Joe Biden’s election victory — and four days after it became clear that Trump had no intention of conceding a lost election.

“The temporary pause for ads about politics and social issues in the US continues to be in place as part of our ongoing efforts to protect the election,” the company wrote in an update to its previous announcement. “Advertisers can expect this to last another month, though there may be an opportunity to resume these ads sooner.”

Facebook’s ongoing political ad pause throws a wrench into things in Georgia, where two January runoff elections will decide which party will control the Senate heading into President-Elect Biden’s administration. A friendly Senate is essential for many of Biden’s biggest proposals, including a $2 trillion climate package that could reshape the American economy and push the country toward an electrified future that doesn’t rely on fossil fuels.

Over the last few days, a shocking number of Republicans have “humored” the president’s refusal to transfer power in spite of an unambiguous election call and Biden’s decisive win in Pennsylvania, which cut off any potential paths to victory for his opponent. The Trump campaign’s last-ditch flurry of legal challenges have presented little of substance so far, and they might ultimately be more about dividing a nation and sowing doubt than prevailing in court.

Europe urges e-commerce platforms to share data in fight against coronavirus scams

By Natasha Lomas

European lawmakers are pressing major e-commerce and media platforms to share more data with each other as a tool to fight rogue traders who are targeting consumers with coronavirus scams.

After the pandemic spread to the West, internet platforms were flooded with local ads for PPE of unknown and/or dubious quality and other dubious coronavirus offers — even after some of the firms banned such advertising.

The concern here is not only consumers being ripped off but the real risk of harm if people buy a product that does not offer the protection claimed against exposure to the virus or even get sold a bogus coronavirus “cure” when none in fact exists.

In a statement today, Didier Reynders, the EU commissioner for justice, said: “We know from our earlier experience that fraudsters see this pandemic as an opportunity to trick European consumers. We also know that working with the major online platforms is vital to protect consumers from their illegal practices. Today I encouraged the platforms to join forces and engage in a peer-to-peer exchange to further strengthen their response. We need to be even more agile during the second wave currently hitting Europe.”

The Commission said Reynders met with 11 online platforms today — including Amazon, Alibaba/AliExpress, eBay, Facebook, Google, Microsoft/Bing, Rakuten and (TechCrunch’s parent entity) Verizon Media/Yahoo — to discuss new trends and business practices linked to the pandemic and push the tech companies to do more to head off a new wave of COVID-19 scams.

In March this year EU Member States’ consumer protection authorities adopted a common position on the issue. The Commission and a pan-EU network of consumer protection enforcers has been in regular contact with the 11 platforms since then to push for a coordinated response to the threat posed by coronavirus scams.

The Commission claims the action has resulted in the platforms reporting the removal of “hundreds of millions” of illegal offers and ads. It also says they have confirmed what it describes as “a steady decline” in new coronavirus-related listings, without offering more detailed data.

In Europe, tighter regulations over what e-commerce platforms sell are coming down the pipe.

Next month regional lawmakers are set to unveil a package of legislation that will propose updates to existing e-commerce rules and aim to increase their legal responsibilities, including around illegal content and dangerous products.

In a speech last week, Commission EVP Margrethe Vestager, who heads up the bloc’s digital policy, said the Digital Services Act (DSA) will require platforms to take more responsibility for dealing with illegal content and dangerous products, including by standardizing processes for reporting illegal content and dealing with reports and complaints related to content.

A second legislative package that’s also due next month — the Digital Markets Act — will introduce additional rules for a sub-set of platforms considered to hold a dominant market position. This could include requirements that they make data available to rivals, with the aim of fostering competition in digital markets.

MEPs have also pushed for a “know your business customer” principle to be included in the DSA.

Simultaneously, the Commission has been pressing for social media platforms to open up about what it described in June as a coronavirus “infodemic” — in a bid to crack down on COVID-19-related disinformation.

Today the Commission gave an update on actions taken in the month of September by Facebook, Google, Microsoft, Twitter and TikTok to combat coronavirus disinformation — publishing its third set of monitoring reports. Thierry Breton, commissioner for the internal market, said more needs to be done there too.

“Viral spreading of disinformation related to the pandemic puts our citizens’ health and safety at risk. We need even stronger collaboration with online platforms in the coming weeks to fight disinformation effectively,” he said in a statement. 

The platforms are signatories of the EU’s (non-legally binding) Code of Practice on disinformation.

Legally binding transparency rules for platforms on tackling content such as illegal hate speech look set to be part of the DSA package. Though it remains to be seen how the fuzzier issue of “harmful content” (such as disinformation attached to a public health crisis) will be tackled.

A European Democracy Action Plan to address the disinformation issue is also slated before the end of the year.

In a pointed remark accompanying the Commission’s latest monitoring reports today, Vera Jourová, VP for values and transparency, said: “Platforms must step up their efforts to become more transparent and accountable. We need a better framework to help them do the right thing.”

EU parliament backs tighter rules on behavioural ads

By Natasha Lomas

The EU parliament has backed a call for tighter regulations on behavioral ads (aka microtargeting) in favor of less intrusive, contextual forms of advertising — urging Commission lawmakers to also assess further regulatory options, including looking at a phase-out leading to a full ban.

MEPs also want Internet users to be able to opt out of algorithmic content curation altogether.

The legislative initiative, introduced by the Legal Affairs committee, sets the parliament on a collision course with the business model of tech giants Facebook and Google.

Parliamentarians also backed a call for the Commission to look at options for setting up a European entity to monitor and impose fines to ensure compliance with rebooted digital rules — voicing support for a single, pan-EU Internet regulator to keep platforms in line.

The votes by the elected representatives of EU citizens are non-binding but send a clear signal to Commission lawmakers who are busy working on an update to existing ecommerce rules, via the forthcoming Digital Service Act (DSA) package — due to be introduced next month.

The DSA is intended to rework the regional rule book for digital services, including tackling controversial issues such as liability for user-generated content and online disinformation. And while only the Commission can propose laws, the DSA will need to gain the backing of the EU parliament (and the Council) if it is to go the legislative distance so the executive needs to take note of MEPs’ views.

Battle over adtech

The mass surveillance of Internet users for ad targeting — a space that’s dominated by Google and Facebook — looks set to be a major battleground as Commission lawmakers draw up the DSA package.

Last month Facebook’s policy VP Nick Clegg, a former MEP himself, urged regional lawmakers to look favorably on a business model he couched as “personalized advertising” — arguing that behavioral ad targeting allows small businesses to level the playing field with better resourced rivals.

However the legality of the model remains under legal attack on multiple fronts in the EU.

Scores of complaints have been lodged with EU data protection agencies over the mass exploitation of Internet users’ data by the adtech industry since the General Data Protection Regulation (GDPR) begun being applied — with complaints raising questions over the lawfulness of the processing and the standard of consent claimed.

Just last week, a preliminary report by Belgium’s data watchdog found that a flagship tool for gathering Internet users’ consent to ad tracking that’s operated by the IAB Europe fails to meet the required GDPR standard.

The use of Internet users’ personal data in the high velocity information exchange at the core of programmatic’s advertising’s real-time-bidding (RTB) process is also being probed by Ireland’s DPC, following a series of complaints. The UK’s ICO has warned for well over a year of systemic problems with RTB too.

Meanwhile some of the oldest unresolved GDPR complaints pertain to so-called ‘forced consent’ by Facebook  — given GDPR’s requirement that for consent to be lawful it must be freely given. Yet Facebook does not offer any opt-out from behavioral targeting; the ‘choice’ it offers is to use its service or not use it.

Google has also faced complaints over this issue. And last year France’s CNIL fined it $57M for not providing sufficiently clear info to Android users over how it was processing their data. But the key question of whether consent is required for ad targeting remains under investigation by Ireland’s DPC almost 2.5 years after the original GDPR complaint was filed — meaning the clock is ticking on a decision.

And still there’s more: Facebook’s processing of EU users’ personal data in the US also faces huge legal uncertainty because of the clash between fundamental EU privacy rights and US surveillance law.

A major ruling (aka Schrems II) by Europe’s top court this summer has made it clear EU data protection agencies have an obligation to step in and suspend transfers of personal data to third countries when there’s a risk the information is not adequately protected. This led to Ireland’s DPC sending Facebook a preliminary order to suspend EU data transfers.

Facebook has used the Irish courts to get a stay on that while it seeks a judiciary review of the regulator’s process — but the overarching legal uncertainty remains. (Not least because the complainant, angry that data continues to flow, has also been granted a judicial review of the DPC’s handling of his original complaint.)

There has also been an uptick in EU class actions targeting privacy rights, as the GDPR provides a framework that litigation funders feel they can profit off of.

All this legal activity focused on EU citizens’ privacy and data rights puts pressure on Commission lawmakers not to be seen to row back standards as they shape the DSA package — with the parliament now firing its own warning shot calling for tighter restrictions on intrusive adtech.

It’s not the first such call from MEPs, either. This summer the parliament urged the Commission to “ban platforms from displaying micro-targeted advertisements and to increase transparency for users”. And while they’ve now stepped away from calling for an immediate outright ban, yesterday’s votes were preceded by more detailed discussion — as parliamentarians sought to debate in earnest with the aim of influencing what ends up in the DSA package.

Ahead of the committee votes, online ad standards body, the IAB Europe, also sought to exert influence — putting out a statement urging EU lawmakers not to increase the regulatory load on online content and services.

“A facile and indiscriminate condemnation of ‘tracking’ ignores the fact that local, generalist press whose investigative reporting holds power to account in a democratic society, cannot be funded with contextual ads alone, since these publishers do not have the resources to invest in lifestyle and other features that lend themselves to  contextual targeting,” it suggested.

“Instead of adding redundant or contradictory provisions to the current rules, IAB Europe urges EU policymakers and regulators to work with the industry and support existing legal compliance standards such as the IAB Europe Transparency & Consent Framework [TCF], that can even help regulators with enforcement. The DSA should rather tackle clear problems meriting attention in the online space,” it added in the statement last month.

However, as we reported last week, the IAB Europe’s TCF has been found not to comply with existing EU standards following an investigation by the Belgium DPA’s inspectorate service — suggesting the tool offers quite the opposite of ‘model’ GDPR compliance. (Although a final decision by the DPA is pending.)

The EU parliament’s Civil Liberties committee also put forward a non-legislative resolution yesterday, focused on fundamental rights — including support for privacy and data protection — that gained MEPs’ backing.

Its resolution asserted that microtargeting based on people’s vulnerabilities is problematic, as well as raising concerns over the tech’s role as a conduit in the spreading of hate speech and disinformation.

The committee got backing for a call for greater transparency on the monetisation policies of online platforms.

‘Know your business customer’

Other measures MEPs supported in the series of votes yesterday included a call to set up a binding ‘notice-and-action’ mechanism so Internet users can notify online intermediaries about potentially illegal online content or activities — with the possibility of redress via a national dispute settlement body.

While MEPs rejected the use of upload filters or any form of ex-ante content control for harmful or illegal content. — saying the final decision on whether content is legal or not should be taken by an independent judiciary, not by private undertakings.

They also backed dealing with harmful content, hate speech and disinformation via enhanced transparency obligations on platforms and by helping citizens acquire media and digital literacy so they’re better able to navigate such content.

A push by the parliament’s Internal Market Committee for a ‘Know Your Business Customer’ principle to be introduced — to combat the sale of illegal and unsafe products online — also gained MEPs’ backing, with parliamentarians supporting measures to make platforms and marketplaces do a better job of detecting and taking down false claims and tackling rogue traders.

Parliamentarians also supported the introduction of specific rules to prevent (not merely remedy) market failures caused by dominant platform players as a means of opening up markets to new entrants — signalling support for the Commission’s plan to introduce ex ante rules for ‘gatekeeper’ platforms.

Liability for ‘high risk’ AI

The parliament also backed a legislative initiative recommending rules for AI — urging Commission lawmakers to present a new legal framework outlining the ethical principles and legal obligations to be followed when developing, deploying and using artificial intelligence, robotics and related technologies in the EU including for software, algorithms and data.

The Commission has made it clear it’s working on such a framework, setting out a white paper this year — with a full proposal expected in 2021.

MEPs backed a requirement that ‘high-risk’ AI technologies, such as those with self-learning capacities, be designed to allow for human oversight at any time — and called for a future-oriented civil liability framework that would make those operating such tech strictly liable for any resulting damage.

The parliament agreed such rules should apply to physical or virtual AI activity that harms or damages life, health, physical integrity, property, or causes significant immaterial harm if it results in “verifiable economic loss”.

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