This week it was revealed Apple is looking to create a “Spotify” for News, giving subscribers unlimited access to premium content, it’s said they are running into challenges with publishers over its 50% take rates & publisher access to data, we look at what this might mean for advertisers. Next we turn our attention to a fraud scheme that DoubleVerify uncovered & discuss what actually happened & what this means for ads.txt.
Next we turn our attention stateside to the news that in 2019 the 3rd largest advertiser in the US will consolidate all of its spending into Xandr, which it acquired in August 2018. Finally we take a look at LiveRamp who have had a busy week, not only did they report some epic earnings they also announced they were adding Connected TV’s to their device graph.
p.s. Next week the newsletter will take a bit of break, but fear not, it will be back in your inbox as usual from the 1st of March.
Apple Is Creating A “Spotify” For News
The big news on the sell side this week is that Apple, in the face of relatively anaemic hardware sales, is looking to further ramp up their services business, with the launch of a paid tier within their already popular news app. This Spotify for news would give users unlimited access to content from premium publishers for a monthly fee of $9.99.
The Palo Alto based giant famously missed the shift in consumer behavior from paying for ownership of music to paying for access & lost ground to competitors, it looks keen to avoid this happening again with News, however it appears the take rate it wants to charge publishers is a sticking point:
Whilst their headline fee has raised eyebrows their methodology for allocating the remaining revenue to publishers seems fair; it will be divided amongst publishers based on the amount of time users spend engaged with their content.
Outside of the concerns about Apple’s take rate, Publishers are worried about access to data, it’s likely they wouldn’t get access to the subscriber data that they would with a direct subscription, such as email address & billing information. That data is such a sticking point underlines the importance of 1st party data to ALL organisations in 2019.
It will be interesting to see if Apple make the service advertising free as per Spotify & Netflix’s paid tiers or whether they will follow the current news model with content being supported by subscription & advertising. If Apple go with an advert free model & the service was popular, this could significantly constrict supply in premium environments for advertisers. Conversely if they chose the latter model & Apple choose to heavily restrict targeting & measurement capabilities (which given ITP you have every reason to suspect they would) this could be also highly challenging for advertisers. Speculation on advertising aside, this could be one of the biggest shifts in online publishing that I can remember, it’s going to be fascinating to watch it play out.
Fraud Scheme Finds A Loophole In Ads.txt?
Last week DoubleVerify uncovered a sophisticated fraud scheme, that many initially reported had found a loophole in ads.txt. On further analysis it became clear that this wasn’t technically what had happened:
Gavin Dunaway@AdMonsterGavinWhoa, is it just me or is this not a new scheme? It's just domain spoofing with scraped content. I also don't see what ads.txt has to to with this—it only works if buyers do their due diligence. https://t.co/4TafQzuMHK
So what did happen then? Here’s a breakdown from the DoubleVerify report:
In essence bots scraped the content of legitimate websites & then generated falsified sites. They then spoofed URL’s so the site appeared authentic. This has (sadly) happened before, but what makes this different is that in (some) cases where a publisher had an ads.txt file in place, the fraudsters were able to gain access to a reseller account listed, with a view to further legitimizing their scheme.
Part of the issue here is publishers not vetting their re-sellers adequately, but conversely platforms shouldn’t be using an ads.txt listing as an indicator that the impression is authentic. Worth noting that with regards to the latter point on authenticity, that enterprise level DSPs do not do this.
Concerns about the looseness of the publisher/reseller relationship led many (myself included) to call for the option to exclude them from campaigns as far back as November 2017. Some DSPs have now implemented this feature, but others still need to catch up.
The industry is getting better at fighting fraud, but it’s an ongoing battle, the roll-out of ads.cert in Q3 & Q4 this year will bring cryptographic encryption that’ll allow authenticity of the impression itself, which whilst technically challenging at run time will bring with it more surety than ever before.
AT&T Consolidate Spend Into Xandr
This Monday it was reported in @MediaPost that AT&T would be consolidating their spend into Xandr:
Until now AT&T’s programmatic ad spend had been split between multiple DSPs, including AppNexus. This move is perhaps unsurprising given that AT&T bought Xandr (FKA AppNexus) in 2018 for a reported $1.6bn, but regardless it will likely become the platforms largest advertiser. AT&T is the 3rd largest advertiser in the US:
The business is said to spend tens of millions of dollars each year in programmatic, across a mix of video, display, mobile and native advertising. Michael Rubinstein, the president of the acquired business, said that AT&T will serve as a “case study” for other brands considering the platform.
No doubt a significant element of this partnership will involve deploying AT&Ts considerable first party data via the Xandr/AppNexus platform & case studies aside once fully integrated the data from AT&Ts 150m subscriber alone, could offer advertisers an very attractive incentive to US advertisers looking to switch DSPs.
That said I think what is more interesting is to see how this plays out internationally, where Xandr do not enjoy a home advantage thanks to AT&T data. Will AT&T/Xandr acquire to compete & pull advertisers away from data loaded bidders like Google’s DV360 & Amazon’s DSP? Or will it increasingly focus its attention in the US where it has a home advantage? Only time will tell.
LiveRamp’s Epic Q3 Earnings & Q1 Product Developments
LiveRamp is the go to data on-boarder for the programmatic industry, Monday this week they posted barnstorming Q3 results & announced some pretty exciting new product developments. Firstly on the financial front, they reported Q3 revenues of $80 million, up 35% YoY. They added 30 new customers in Q3, including BMW & now have over 640 direct customers, a YoY increase of 23%.
LiveRamp now serves 19% of the Fortune 500 & the scale/value of their portfolio is underlined by the size of the contracts they hold, the number of clients with contracts worth more than $1 million per year increased by 35% last year.
But the earnings call wasn’t all about headline grabbing financial disclosures, LiveRamp took the opportunity to highlight that it had added Connected TV IDs to IdentityLink it’s proprietary identity graph.
Advertisers using identity link will have a better view of their audiences across screens & the ability to activate across OTT & other digital channels in a connected way.
This development will bring with it benefits from both a measurement & attribution perspective, but it will be interesting to see how LiveRamp will resolve that fact that OTT devices will be the first in the graph that are one to many, not one to one (like a smartphone). This aside, this it is yet another exciting development, in what is shaping up to be a seminal year for Programmatic TV.
Okay that’s the newsletter done for another week & thank you for making it this far!
As I mentioned it will return on the 1st of March.
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