U of Digital Newsletter - 10/2/24 (free)

Author

Shiv Gupta
October 02, 2024

September 25th-October 1st

Below is a roundup of last week’s notable industry news, with summaries and our opinions. We’ll go with the lightning round format this week! Starting with #USvGoogle, which has officially ended. (but probably just getting started…)

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Top Stories 👁️ 

Update On The Most Consequential Trial In Advertising History—#USvGoogle

Google blew through its witnesses relatively quickly, rested its case, and then the DOJ rebutted with a final publisher witness. The entire case lasted only three weeks, much shorter than the four to six weeks initially expected.

Who Testified: 

  • Ryan Pauley, Vox Media

  • Brian Bumpers, Zulily

  • Matthew Wheatland from The Daily Mail. (rebuttal witness)

  • Mark Israel, Compass Lexicon

  • Jessica Mok, finance director, Google

  • Judith Chevalier, Professor at Yale

  • Adam Stewart, VP of Consumer Goods, Government, and Large Customer Sales at Google

Important Revelations: 

• Google’s Antitrust Defense: Fees Are Competitive and Rivals Were a Threat 🔒 - Google lost $510M to The Trade Desk in 2020 and was at risk of losing another $1.4B.

• My market is bigger than yours - Google’s display business didn't turn a profit until 2018.

source: Marketecture

• The Google Ad Tech Antitrust Case Is Over – And Here’s What’s Happening Next - Even if the judge rules quickly, the case will no doubt drag on in appeals for years.

Important Opinions:

What’s Next: Each side will present their oral closing arguments on Monday, Nov. 25. A ruling could come as soon as early 2025. A separate but similar antitrust case filed by a group of states led by Texas is scheduled for early 2025.

Related Google News: 

How a Google breakup could reshape digital marketing—5 strategies to consider 🔒- Breaking up Google would have far-reaching implications for the digital advertising ecosystem. Ad Age offers a survival guide for marketers. 

Other Notable Headlines ✍️

EchoStar to sell Dish to DirecTV, combining major pay-TV providers - DirecTV will pay $1 for Dish and Sling, while agreeing to take on about $9.75B in debt. Together, the companies—two of the industry's biggest pay-TV operators—will serve nearly 20M customers. It's a merger that's been decades in the making, after having been close to a deal back in 2002. AT&T, which had a 70% stake in DirecTV, also agreed to sell its entire interest to private equity company TPG for $7.9B. AT&T bought DirecTV for $48.5B and sold a 30% stake to TPG for $16.2B in 2021. The declining value illustrates the challenges facing the satellite TV industry as audiences cut the cord and move toward streaming. The Dish deal will likely close in Q4 2025, pending approval from some Dish bondholders.

Opinion: Scale is the name of the game in the shrinking satellite TV industry, and the partners say they’ll be able to offer smaller, cheaper packages while generating at least $1B in "cost synergies" annually within three years of the merger. The big question is whether they effectively they can pivot into streaming as their primary business, before they turn into the next Blockbuster.

Paramount Close to Dropping Nielsen TV Ratings in Contract Dispute - Paramount Global is moving toward other forms of audience measurement as Nielsen insists on "substantial price increases across all their products." Paramount pays Nielsen hundreds of millions dollars every year for measurement, but bristles that in some cases, Nielsen's fees are higher than the ad revenue of the network being measured. Starting Tuesday, Paramount planned to use rival VideoAmp to track audiences when Nielsen's counts aren't available. TV networks have historically complained that Nielsen's cross-screen measurement leaves a lot to be desired, and the incumbent was found to have undercounted audiences during the pandemic. Paramount operates Comedy Central, Nickelodeon, and CBS, which is airing the vice presidential debate Tuesday night.

Opinion: This isn't the first time Paramount and Nielsen have butted heads over pricing, and we don't expect it to be the last as Nielsen's competitors gain more market share. But so long as advertisers rely on Nielsen, networks like Paramount will probably have to as well, at least for the foreseeable future.

LG smart TVs have started displaying ads when idle - LG's new native ad units pop up as full-screen ads on the home screen, content store, and LG channels before a traditional screensaver is shown. Changing consumer behavior has made the screensaver ad a hotter commodity, LG says. While the screensaver once meant that a viewer had likely left the room, today's multitasking viewers are probably using their phones or tablets to shop, play games, or message their friends and family. Users can turn off the screensaver ads if they'd like. The ads will run the gamut from promoting LG's products to brands advertising products and services unrelated to TV or entertainment. LG plans to run ads on more than 200M smart TVs worldwide by the end of 2024.

Opinion: This seems on-brand for LG. Its smart TVs routinely serve unmuted auto-playing ads in its app store, and it's not exactly known for its consumer-friendly UX. We get it; everyone’s trying to maximize that sweet, sweet CTV ad money! 

Ryan Reynolds’s ad tech firm MNTN looks to Morgan Stanley for 2025 IPO - CTV ad platform MNTN bought Ryan Reynolds' creative agency Maximum Effort Marketing in 2021 and named Reynolds its chief creative officer. MNTN has reportedly retained Morgan Stanley to explore an IPO, including the price and timing, which is said to likely occur in the beginning of 2025. MNTN raised $119M in Series D financing in 2022. The company focuses on "fastvertising" with ads that can be released within a few days to capitalize on real-time trends. Its CTV platform, MNTN Performance TV, helps advertisers optimize for their direct-response campaigns.

Opinion: Good signal for ad tech investment and M&A if ad tech companies can once again have successful IPOs. These have been hard to come by in recent months and years, so we should all be cheering for MNTN’s IPO!

At Meta Connect, a host of new mixed reality hardware and AI updates presented by CEO Mark Zuckerberg 🔒- Meta CEO Mark Zuckerberg believes that Ray-Ban smart glasses will give Apple and Google a run for their money. At the recent Meta Connect conference, Zuck unveiled a prototype of Orion, the company's first “true AR” glasses that leverages light diffraction to project holographic displays onto an environment. Orion, in the works for years, would build on the growing popularity of Meta's smart Ray-Bans and could potentially generate loads of data-driven insights and opportunities for greater personalization. Also at the conference, Meta announced updates for its AI products to help users better understand images and text, as well as Llama 3.2, its latest AI model. The new Meta Quest 3S mixed reality headset is a cheaper version of its predecessor, which could help spur adoption.

Opinion: We think Mark Zuckerberg’s shirt (and glasses) look dumb.

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