The WIR: Netflix Adjusts Microsoft Partnership, Pinterest Pins Down Video, and Google is Sued for TrueView Violations

In this week’s Week in Review: Netflix adjusts its advertising partnership with Microsoft, Pinterest unveils new video ad offerings, and Google is hit by a class-action lawsuit for violating agreements for video ad placements.

The Week in Tech

French Competition Authority Investigates Apple’s Use of Data for Advertising

France’s competition watchdog, l’Autorité de la Concurrence, has launched an investigation into Apple’s use of data for advertising purposes. On Tuesday the regulator issued a statement of objections over the tech giant’s handling of user data gathered from iPhone apps. In 2020 the watchdog was compelled to investigate Apple over complaints that its App Tracking Transparency (ATT) policy gave the company an unfair advantage in the advertising sector. “Apple is accused of having abused its dominant position by implementing discriminatory, non-objective and non-transparent conditions for the use of user data for advertising purposes,” the authority said in a statement.

UK Government to Crack Down on Illegal and Inappropriate Online Ads

The UK Government announced it will place tougher rules on Google Ads and other major ad tech companies to stop children seeing inappropriate ads, including alcohol and gambling promotions, as well as fraudulent celebrity endorsements for financial scams. Ministers said online advertising intermediaries will be given more responsibility for policing such content, alongside online publishers, apps and websites serving ads. “Advertising is a huge industry in which Britain is a world leader,” said Creative Industries Minister Sir John Whittingdale. “However, as online advertising has taken a steadily bigger share, the rules governing it have not kept pace and so we intend to strengthen them to ensure consumers are properly protected.”

YouTube Ad Sales Up 4.4 Percent in Q2

YouTube has posted a 4.4 percent rise in ad sales for Q2 2023, reaching $7.67 billion, marking a reversal of three consecutive quarterly declines. Alphabet, the parent company of Google and YouTube, also reported 7 percent sales growth, hitting $74.6 billion during the quarter. The company additionally highlighted YouTube Shorts, its short-form video feed, which surpassed 2 billion monthly users, up from 1.5 billion a year ago. The quarter also saw advertisers starting to test spots and direct-response formats in Shorts, according to Google chief business officer Philipp Schindler. The introduction of 30-second unskippable ads and “new Pause experiences” are also expected to bolster YouTube’s CTV presence. “30-second ads are a TV industry staple, and now YouTube is bringing our advanced audience capabilities and unparalleled reach to the format,” said Schindler.

Snap Shares Plunge at Q2 Sales Drop

Snap sales slid 4 percent YoY in Q2 2023, totalling $1.1 billion, the Snapchat parent company announced in its quarterly earnings. The social media business is retooling its advertising platform, claiming a record number of active advertisers in the second quarter. But its forecast for Q3 ($1.07-1.13 billion) anticipates a 5 percent YoY drop at worst, and flat growth at best. Snap shares fell 19 percent in light of the results.

Meta Ad Sales Drive 11 Percent Revenue Growth in Q2

Meta revenues rose 11 percent YoY in Q2, with ad revenues up 12 percent during the quarter. The Facebook and Instagram owner filed $32 billion in quarterly revenues, and forecast Q3 revenues between $32 billion and $34.5 billion. Last month, Meta CEO Mark Zuckerberg said the company was using AI to drive engagement and improve ad targeting on its platforms. “Advertisers are gaining confidence in Meta’s enhanced and AI-powered campaign planning and measurement capabilities, and spending more,” Morningstar analyst Ali Mogharabi told Reuters.

Innovid Launches Cookieless Cross-Platform Measurement

Innovid, a TV measurement company, has launched a cookieless cross-device measurement tool. Powered by the Innovid Key identity framework, the new solution matches multiple devices to user interactions, in order to increase conversion rate accuracy. “With Innovid’s cross-device conversion reporting, advertisers can accurately gauge the impact and effectiveness of their CTV campaigns, attributing views directly to site activity and justifying the growing investment of ad dollars,” said Innovid CPO Dale Older. “Now, marketers can match events that a household did across different devices in a cookieless, privacy-compliant manner, resulting in a more accurate conversion rate.”

IAS and Criteo Partner for Retail Media Measurement

Integral Ad Science (IAS), an ad verification specialist, has announced a partnership with French ad tech giant Criteo, to provide viewability and invalid traffic (IVT) measurement for retail media transactions. IAS will measure IVT for Criteo’s network of retail media partners, ensuring that marketers are reaching real users. “Through our upcoming integration with Criteo, we can enable marketers to maximise their return on ad spend through third-party measurement across the powerful retail media networks working with Criteo,” said IAS CCO Yannis Dosios.

PubMatic Launches Self-Serve Commerce Media Platform ‘Convert’

Supply-side platform PubMatic has this morning announced the launch of ‘Convert’, which it describes as a “unified self-service advertising platform for commerce media”. The new product is designed to help commerce media networks sell inventory both onsite and offsite, including sponsored listing ads on ecommerce stores, retail data-powered CTV and video ads, and display ads. Buyers will also be able to access this inventory through agencies which have direct relationships with the SSP via supply path optimisation (SPO) deals. Read more on VideoWeek.

Analysts Warn Twitter Rebrand Could Wipe Billions in Value

Elon Musk rebranded Twitter to ‘X’ this week, a move that analysts estimate could wipe out anywhere between $4 billion and 20 billion in value, according to Bloomberg. “It’s going to go down in history as one of the fastest unwinding of a business and brand ever,” said Allen Adamson, co-founder of Metaforce, a marketing and brand consultancy. New CEO Linda Yaccarino said the rebrand positions X as a destination for audio, video, messaging, payments and banking. The company is also offering 50 percent price cuts on video ads, which run alongside trending topics on the Explore tab, in efforts to woo advertisers back to the platform. And brand accounts will lose their verification if they haven’t spent at least $1,000 on ads in the previous 30 days, or $6,000 on ads in the previous 180 days, according to an email seen by the WSJ.

X is the future state of unlimited interactivity – centered in audio, video, messaging, payments/banking – creating a global marketplace for ideas, goods, services, and opportunities. Powered by AI, X will connect us all in ways we’re just beginning to imagine.

— Linda Yaccarino (@lindayacc) July 23, 2023

DoubleVerify Rolls Out Ad Verification to YouTube Shorts

DoubleVerify (DV), a measurement and verification business, will extend its authentication services to YouTube Shorts, as part of an expansion of its partnership with Google. The integration will help advertisers on YouTube Shorts ensure their video ads are safe from fraud and invalid traffic, according to DV, and will also cover Masthead and In-feed Video formats. “We are excited to expand our solution to include viewability and fraud coverage on YouTube Shorts – giving global brands greater clarity and confidence in their investments,” said DV CEO Mark Zagorski. “Short-form videos offer advertisers a high-engagement forum to connect with passionate online communities. This release enables our customers to authenticate their media and maximise campaign effectiveness.”

The Week in TV

Production Becomes ITV’s Primary Money Maker After Steep Ads Fall

British broadcaster ITV’s ad revenues for the first half of this year were down 11 percent year-on-year, according to the company’s financial update today, contributing to a one percent fall in total revenues. CEO Carolyn McCall said weak ad revenues had been “expected” given the “very tough advertising market”. Read more on VideoWeek.

Streaming Households Rise in UK

The number of UK households with at least one streaming subscription rose by 24 percent in Q2, according to Kantar. The research showed that 19.97 million households subscribed to at least one streaming service in Q2 (representing 68 percent of households), up from 16.1 million households in Q1. Kantar also found that 7 percent of UK households took out a new streaming subscription in Q2 2023, compared with 5 percent in Q2 2022. “We observe that Netflix has showed resilience in the face of changing industry dynamics, but households are diversifying their content preferences, exploring offerings from other streaming services like Apple TV+ and Disney+,” said Dominic Sunnebo, global business unit and commercial director at Kantar Worldpanel. “With the cost of living crisis showing little sign of abating, it’s those services that can demonstrate the most value that are likely to emerge as clear winners.”

ITV and Pact Agree Streaming Trade Deal

ITV has agreed a new trade deal with Pact, the UK trade association for independent content producers. The deal, which the groups call “fit for the streaming era”, is said to offer producers enhanced tariffs, improve the availability of their programmes on ITVX, and allow premieres on ITVX without the need to negotiate rights separately. “The new terms recognise that the old world of primary linear rights and secondary on demand rights no longer meets audience needs,” said ITV. “It will allow ITV to enhance ITVX with flexible windowing, improved series stacking and increased box set availability – delivering all previous series of a title on ITVX and allowing viewers to catch up from the beginning in its entirety before a new series starts.”

Roku Revenues Climb as ARPU Falls in Q2

Roku revenues were up 11 percent YoY in Q2, totalling $847 million. While its platform business (which includes revenue from both ad sales and content distribution) climbed 11 percent, ad revenues struggled under the macroenvironment and ongoing strikes in the US. Roku added 1.9 million new active accounts during the quarter, now totalling 73.5 million global accounts, but average revenue per user (ARPU) fell 7 percent to hit $40.67.

Peacock Offsets Domestic Advertising Losses at Comcast

Comcast saw domestic ad revenues fall 5 percent to $2.03 billion in Q2, according to the broadcaster’s earnings report. However, the decline was partially offset by an 85 percent rise in revenues at streaming service Peacock, which hit $820 million. Total Comcast revenues for the quarter rose 1.7 percent, for a total $30.51 billion.

FIFA+ Lands on More CTV Apps and FAST Channel Platforms

FIFA’s streaming service FIFA+ expanded its CTV presence this week, landing on five more apps and five FAST platforms. The FAST channel is now available on Samsung TV, LG, VIDAA, Amazon Fire and Android TV, as well as Samsung TV Plus, LG Channels, VIDAA Channels, The Roku Channel and Rakuten TV. “FIFA is committed to using digital platforms to create an inclusive and immersive football experience for all,” said Charlotte Burr, Director of Strategy, Corporate Development and Digital at FIFA.

ESPN Chief Confirms Plans for Investment Partnerships, D2C Offering

Disney is seeking media partners for launching ESPN as a direct-to-consumer offering, ESPN chief Jimmy Pitaro confirmed this week. Pitaro responded to questions at a CNBC event on Tuesday, following Disney CEO Bob Iger’s comments about plans to sell part of the sports cable channel. Iger and Pitaro are rumoured to have held talks with the National Football League (NFL), National Basketball Association (NBA) and Major League Baseball (MLB) about becoming minority investors in ESPN. “We are going to be making our flagship channels available direct to consumer,” said Pitaro. “And yes as a part of that we are interested in partners. Partners that we think can make the flagship product more compelling.” He gave no confirmation of potential partners, but said there was “a healthy level of interest” in ESPN.

The Week for Publishers

THG Buys City AM

Online retailer THG has bought London-based business news publication City AM for an undisclosed fee, saving the newspaper from entering administration. While it has previously been reported that City AM was looking for a buyer, THG emerged as an unlikely candidate, given its lack of media experience. Chief executive Matthew Moulding said the company has “long been reviewing opportunities in the disruptive media space,” adding that the acquisition could strengthen THG’s ‘Ingenuity’ ad tech platform.

Reach Profits Fall Following Social Alienation

UK new publisher Reach said that Meta’s moves away from news content, as well as a tough print advertising market, are denting the company’s digital revenues. Adjusted operating profits were down by 24 percent in the first half of the year, with CEO Jim Mullen stating that digital revenues had been “materially affected” by low referral traffic, partly caused by Facebook’s deprioritisation of news.

The Guardian Grows Revenues but Posts a Loss

The Guardian posted a fresh set of earnings this week, revealing that in the year to March 2023 revenues were up three percent, the fourth year in a row that the newspaper has posted revenue growth. Digital revenues now account for 70 percent of total revenues, according to the results. Despite the growth, The Guardian posted a loss, with a net operating cash outflow of £21 million. The paper attributed this loss to investment in its editorial teams, newsletters, podcasts, and digital capabilities, as well as the expansion of its international business.

The Telegraph Grows Profits and Revenues

The Telegraph, which is seeking a buyer after having been repossessed by Lloyds Banking Group, reported revenue growth of four percent YoY in 2022, with profits before tax up 39 percent. The Telegraph also said it is on course to reach one million paying subscribers by the end of the year. Subscriptions have been a major focus for The Telegraph in recent years, and subscription revenues now account for more than half of The Telegraph’s total revenues.

Swedish Paper Aftonbladet Finds Generative AI Helps Increase Read Time

Swedish daily newspaper Aftonbladet has found that including AI-generated summaries of its articles at the top of each piece has helped grow overall read time across the site, Press Gazette reported this week. Deputy editor Martin Schori told Press Gazette that giving readers a general understanding of what an article is about likely helps encourage site visitors to go on and read the whole text.

The Week For Brands & Agencies

Brands Are Buying BVOD in Otherwise Flat Year for UK Ad Spend

The Advertising Association and WARC today released their Expenditure Report, assessing the rate of ad spend in the UK. According to the report, UK ad spend reached £9 billion in Q1 2023. Spend was flat for the quarter, with 0.1 percent YoY growth. Read more on VideoWeek.

IPG Downgrades Forecast After Revenue Fall

Interpublic Group downgraded its full-year organic growth forecast last Friday after reporting an organic decrease in net revenues of 1.7 percent in its Q2 financial results. IPG now expects full-year growth of between one and two percent. The agency group said it has seen particular weakness in ad spend from tech and agency brands, with most other sectors increasing their investment in advertising.

Dentsu Agrees New AI Partnership with Microsoft

Dentsu this week announced an expansion of its partnership with Microsoft which will grant Dentsu agencies access to advanced Azure OpenAI technologies. Dentsu says its AI-focused collaboration with Microsoft has already resulted in the development of two new CXM solutions: Merkle GenCX, which uses generative AI to deliver more impactful customer experiences, and AI Playground LATAM, an AI tool designed to bring “more day-to-day efficiency and operational agility to clients”.

S4 Capital Reports Lower Than Expected Q2 Revenues

S4 Capital, like IPG (see above), downgraded its full-year growth guidance this week after reporting Q2 revenues below expectations. Organic net revenue over the first half of the year was up by five percent, lower than had been previously hoped. The company said that May and June in particular had been disappointing months, saying that many clients, especially those in the tech sector, remain cautious and short-term focused.

Bloom UK Launches Major Consultation into Work-Life Balance

Bloom UK has announced the launch of The Juggle, a nationwide consultation on work-life balance. The study will explore the factors which are causing women to be more likely to be concerned about burnout than men, to provide more emotional support to others than men, and to be underrepresented in certain job roles due to work-life balance. Elizabeth Anyaegbuna, president at Bloom UK, said the study will be “the biggest and most in-depth consultation into this issue through an intersectional lens to explore how different groups of women are affected”.

UK Consumers Plan Christmas Spending Cutback

Advertisers looking for strong sales over the Christmas period might be somewhat disappointed, as almost two-thirds of UK adults say they’re planning to cut back on Christmas spending due to the cost of living crisis, according to data from the IPA and Opinium. The hospitality sector may be hit particularly hard, with 24 percent saying they will reduce how much they spend on meals out, and 19 percent saying they will cut down on visits to pubs and bars.

Spark Foundry finds TV is Most Representative Channel When it Comes to Ads

Publicis-owned agency Spark Foundry has found that audiences report TV to be the most representative channel when it comes to advertising, while gaming is the least representative. Spark Foundry’s report on sustainability, tech and gaming, and diversity in advertising also found that 57 percent of 18-34s say they are more likely to favour brands which support diversity.

Hires of the Week

Publicis Promotes Dave Mulrenan to Chief Investment Officer at PMX

Publicis Media UK has promoted Dave Mulrenan to Chief Investment Officer at PMX, the agency group’s trading and investment arm. Mulrenan has been with Publicis-owned Zenith UK for almost 25 years, most recently as Chief Investment Officer.

Advertising Association Names Lisa Hayley-Jones Director of Public Affairs

The Advertising Association has appointed Lisa Hayley-Jones as Director of Public Affairs. The former Chair of Westminster Forum, Hayley-Jones replaces Sue Eustace after more than 20 years of service.

Bountiful Cow Hires Nadine Campbell as Head of Digital

Bountiful Cow, an independent media agency, has named Nadine Campbell as Head of Digital. Campbell’s agency experience includes roles at Wavemaker, MediaCom and Manning Gottlieb OMD.

Seven.One Entertainment Group Appoints Carsten Schwecke to Head of Sales

Seven.One Entertainment Group, a subsidiary of ProSiebenSat.1, has enlisted Carsten Schwecke as Head of Sales. Schwecke most recently served as CEO of Axel Springer’s All Media/Media Impact division.

OpenX Enlists Danner Close as VP Strategic Relationships

OpenX Technologies, an omnichannel supply-side platform, has hired Danner Close as VP Strategic Relationships. Close joins from ad tech firm Permutive, where he was

iSpot Announces Leslie Wood as Chief Research Officer

iSpot, a TV measurement company, has announced the appointment of Leslie Wood as Chief Research Officer. Wood previously spent 12 years marketing effectiveness firm