Today’s subscriber update is on the theme of online advertising. Since my recent analysis posts have been focused on the subscriptions market, I thought I better take a look at the latest news on the (not dead yet) online advertising market.
What You Need To Know 👀
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Washington Post builds ad network for publishers to take on Big Tech
“The Washington Post on Tuesday will unveil Zeus Prime, a product that will allow companies to buy automated ads in real-time, similar to Big Tech platforms. Zeus will also support a new ad network that will include other publishers. […] The product will allow publishers to open their ad space to marketers directly through a real-time buying tool, similar to what Google and Facebook offer, across the network of publishers’ websites and apps.”
My take: So Jeff Bezos wants to join the duopoly Google and Facebook in controlling the online advertising market. I guess three is better than two. The Axios piece goes on to note there are several catches to Zeus Prime, including that if a company “wishes to join the ad network that The Post is building, it needs to license all three of The Post’s commercial software products.” On the plus side, it is good that it’s a media company taking on Google and Facebook – albeit one owned by Amazon’s CEO.
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Can online advertising create a quality metric?
The Financial Times is currently promoting a campaign for a “better form of capitalism”. One of the campaign articles caught my eye, as it concerns advertising and the Web. The FT’s John Thornhill highlighted a company called Factmata, which ascribes “a trust score” to online content in order to serve up more socially responsible ads:
“At present, advertisers mostly buy online ads on the basis of CPMs, or the cost per one thousand clicks or views. But such programmatic advertising takes little or no account of the nature of the content. Factmata is aiming to introduce a quality component to this metric, creating a Q-CPM, a kind of nutritional label for information.
My take: If it works, this would certainly help the cultural industries – since for the most part these sectors aim to create quality cultural content. As I noted in my weekly analysis yesterday, online advertising revenue has become very difficult to get for independent media like blogs and newsletters. But if advertisers can better avoid low quality sites and the clickbait that infests Facebook, that theoretically this will help indie media claim some of that revenue back again.
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SoulPancake granted some control over advertising on its YouTube videos
TubeFilter discusses a digital content studio called SoulPancake, which is “one of a handful of organizations permitted to work directly with marketers to sell advertising on their YouTube videos.” TubeFilter explains:
“For the majority of advertisements run on YouTube, the platform itself sells them, and creators don’t have any part in the process or any control over which ads run on their content. In 2010, YouTube began allowing what it says is a “small number” of partners to instead control their own advertising inventories.”
My take: This article illustrates how little control creators and cultural sector companies have over the advertising that runs on their content (if indeed they choose to run adverts on it). Good on SoulPancake for being one of the rare companies to be permitted some control over the process, but it’s a sad reflection on the iron grip Google and Facebook have over this industry.
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Vivendi, Riot veterans announce gaming broadcast network, VENN
GamesIndustry.biz reports on a new esports and gaming broadcast network, launching in 2020. Given the theme of today’s newsletter, I thought the monetization comments were interesting:
“Kusin adds that brand partnerships will play a key role in how the service earns revenue, with particular opportunities focused on VENN’s live studios. And he suggests that there may be multiple tiers of subscriptions for viewers to gain access to different features. “We wanted to stay away from a business model that was wholly reliant upon 30- and 60-second ad sales,” he says.”
My take: It sounds like VENN will try to earn revenue from ads, brand partnerships (e.g. with YouTube and Twitch) and subscriptions – in other words, all the main revenue groups of this era. The founders are positioning VENN as an MTV for the gaming generation, which is highly promising idea given how large that market will become. I bet it’ll have no trouble making money.
Data Points 📊
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Integral Ad Science: Desktop display ad viewability rates have improved globally in the first half of 2019 with a viewability rate of 69.2%, an increase of 12.3% year-over-year.
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eMarketer: In 2019, digital will account for 50.1% of total media ad spending worldwide thanks to strong growth from major digital ad sellers like Google, Facebook, Alibaba and Amazon.
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Current: Podcast sponsorship revenue continues to fuel NPR’s financial growth.
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Marketing Charts: The global cinema advertising market is expected to grow by 6.8% year-over-year in 2019 to reach $4.6 billion.
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Newzoo: Android games will earn more revenue than iOS games in 2019.
Tweet of the day 🐦
An ex-Facebook employee approves of The Washington Post’s new ad tech play:
That’s the latest subscriber update, hope you found it useful. Your early support of Cybercultural is much appreciated. 🙏