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U of Digital Newsletter - 4/23/25 (premium)

Author

Shiv Gupta
April 23, 2025

April 16th-April 22nd // Estimated Reading Time: 12 minutes

Below is a roundup of last week’s notable industry news, with summaries and our opinions. This one’s all about Google…

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Top Stories 👁️

Summary: After much anticipation, Google has abandoned plans to launch a standalone user choice prompt for third-party cookies in Chrome. Anthony Chavez, Google's VP of Privacy Sandbox, announced this reversal in a blog post Tuesday, noting that "divergent perspectives" from stakeholders made consensus impossible. Instead, users will continue managing cookie preferences through Chrome's existing Privacy and Security Settings.

This effectively returns the industry to where it stood in late 2019, erasing 5-plus years of frantic preparation, resource allocation, and "cookieless future" investments across the entire ecosystem. The original cookie deprecation timeline has been delayed multiple times, eventually morphing into the proposed "global prompt" last summer before this complete abandonment. Despite all the time, money, and effort spent by thousands of companies preparing for a cookieless world, we're essentially back to square one.

The timing is particularly noteworthy given Google's current antitrust challenges. Last week, Google was found guilty in the ad tech antitrust case, and the company is currently in a remedies trial for the search antitrust case—which potentially includes a Chrome spinoff (more on this later). The UK Competition and Markets Authority (CMA), which has been supervising Privacy Sandbox development since 2022 to ensure it wouldn't advantage Google, will now need to reevaluate its oversight approach.

Google isn't completely stepping away from privacy enhancements. The company still plans to implement IP Protection in Chrome's Incognito mode in Q3. The Privacy Sandbox APIs will also continue development, though Chavez suggested they'll have "a different role to play" going forward, with an updated roadmap coming in the next few months.

Opinion: Google's cookie reversal tells us two things: a) antitrust now clearly trumps privacy in Google’s business risk calculations and b) we have arrived at a "privacy endpoint" in digital advertising. At least for now.

Consider the pattern that has been emerging in recent months:

We're at the point where regulators are effectively saying: big tech is using privacy to harm competition. Ironically, in the time it took for regulators to catch on to what was happening, independent ad tech spent tons of time and money building products for a privacy-centric world (some bet their entire existence on it). Now, this government imposed “privacy endpoint” will end up … harming the competition. The pendulum that swung hard toward privacy after Cambridge Analytica is now swinging back toward the middle. And it’s going to cause all sorts of industry whiplash.

There are a bunch of winners and losers to anoint. Winners include cookie-reliant ad tech companies and publishers. Losers include clean room companies and alternative ID solutions. 

Hilariously, the biggest winners may be the "lazy" (or perhaps prescient) marketers who didn't build a strategy around cookie deprecation. Those who kept their heads down and kept executing with the tools at hand now find themselves in the strongest position.

Perhaps the most important lesson from this six-year saga is that digital advertising's true north has never been about cookies or privacy—it's about delivering value to consumers in exchange for attention and data. Smart marketers that stay focused on this transparent value exchange rather than chasing technical workarounds or regulatory loopholes will win. 

Federal Court Finds Google Violated Antitrust Law in Adtech, Potentially Reshaping the Digital Advertising Industry🔒
Source: Adweek
April 17th, 2025

Summary: A federal judge found that Google illegally maintained monopolies in two critical areas of the ad tech ecosystem: publisher ad servers and ad exchanges. The court also ruled that Google violated antitrust law by tying its ad server, formerly known as DoubleClick for Publishers (or DFP), with its ad exchange, AdX. The court dismissed claims about Google's advertiser-focused products like DV360 and its ad network.

The ruling represents a significant blow to Google's ad tech dominance and could force the company to divest parts of its highly profitable ad tech stack. Google will appeal. Google VP of regulatory affairs, Lee-Anne Mulholland, told employees that Google "won half of this case" since the court found that its "advertiser tools and acquisitions, such as DoubleClick, don't harm competition." Google said that publishers choose its ad tech tools because they are "simple, affordable and effective."

This is the second major antitrust setback for Google in less than a year, following a ruling last August that the company illegally monopolized the search market. Coincidentally, the hearing about remedies to settle that case just began this week. The Justice Department wants to force Google to divest its Chrome browser, which Google attorney John Schmidtlein called the "most extreme" request. The DOJ also wants restrictions on future exclusive distribution agreements involving Google's AI assistant Gemini, though Google argues that Gemini wasn't the subject of the original antitrust case.

Opinion: Depending on the remedies of these cases, we could be headed for much-needed reform or unnecessary chaos.

From Google’s perspective, if they can tie the cases together, perhaps they’ll be able to negotiate an outcome that isn’t so bad for their business. Here's our read on Google’s hierarchy of concerns:

  1. The Crown Jewels: Google's owned & operated properties (Search, YouTube, Maps, Gmail, etc.) are their high-margin cash cows—they'll fight tooth and nail to keep these

  2. The Distribution Network: Chrome and Android feed their O&O business—losing Chrome would be catastrophic

  3. The Publisher Pipeline: GAM, AdX, and AdSense, when combined with their O&O, pull in massive demand

  4. The Demand-Side Sacrificial Lamb: DV360 is essentially a loss leader in a very competitive DSP category—the most expendable piece

The DOJ is shrewdly targeting items #2 and #3, going for Chrome in the search case and AdX/GAM in the ad tech case. Smart move—hit 'em where it really hurts without attacking the consumer-facing O&O products.

As Ari Paparo of Marketecture outlines in his comprehensive analysis, there's a spectrum of potential outcomes. But the "nuke it" approach of forcing both Chrome divestiture AND breaking up the ad tech stack would send shockwaves through the ecosystem. The open web might never recover from that level of disruption. We'd see fragmented tech stacks, increased integration costs, and complexity that would drive more advertisers and publishers into the arms of Meta, Amazon, and TikTok. Sure, independent ad tech would benefit as well. But this is not the only goal, and certainly not the most important. Consumers are the most important.

Targeted interventions could restore competition without burning down the open web. For example:

  • Separate AdX from GAM but keep them functional

  • Ban exclusivity arrangements (like the Apple search deal)

  • Prohibit preferential treatment between Google products

  • Force Google to open its inventory to other DSPs

These behavioral remedies would level the playing field without throwing advertisers and publishers into complete chaos. Which ultimately protects consumers. 

Regardless of what may happen, it’s time for you to start scenario planning NOW. What will you do if Chrome spins off? If GAM and AdX divorce? If integration costs triple? If YouTube is available through multiple sources?

Get excited. Things are about to get wild.

Q1 Earnings!

Netflix (👍): Revenue was up nearly 13% to $10.54B, beating estimates. Price increases and growing ad revenue helped fuel growth. The streamer affirmed its full-year forecast, despite worries about tariff-related economic uncertainty. Shares rose 2% in extended trading following the report.

Publicis (👍): Organic growth was 4.9%. The French agency holding company scored 12 new business wins in Q1 and began integrating Lotame with Epsilon. Publicis affirmed its full-year forecast of 4%-5% organic growth, outpacing competitors like WPP and Dentsu. Shares rose 2.6%.

Omnicom (👎): Organic growth was 3.4%. Its advertising, media, and CRM services drove growth, but the agency holding company's revenue missed expectations. Omnicom still expects its IPG deal to close later this year. Shares fell nearly 4%.

Opinion: How much will those tariffs really hurt digital advertising? We’ll have a far better idea in the coming weeks. Netflix had a solid report, but its business is somewhat insulated from tariffs, due to its subscription-based model and global reach. Publicis is ahead of the pack, so its solid report isn’t surprising. It’s worth watching the agency holding companies’ performance since they generally have the most visibility into marketers’ purse strings. 

Other Notable Headlines

Netflix is revamping search with AI to improve discovery - Netflix is developing AI-powered "interactive search" to improve content discovery beyond the 1% of titles that dominate viewing. Currently being tested with OpenAI in Australia and New Zealand, this initiative accompanies Netflix's first major TV app homepage redesign in a decade, set for release later this year. Could AI search finally solve the endless scrolling problem that plagues most streaming services? Netflix has also just launched its in-house ad tech in the US (an ad server) and plans expansion to 10 additional markets with enhanced targeting capabilities. They clearly have ambitions to own ad tech; keep an eye on Netflix as a potential acquirer. 👀 

Western Union Launches Media Network, Seeks to Monetize 15 Million US Customers - Western Union has launched a media network using Magnite's ClearLine solution, giving advertisers access to first-party transaction data across its 15 million US customers. The partnership allows direct buying of video ad inventory without a demand-side platform (DSP), marking the first commerce media network to use SSP tech like ClearLine to go direct to advertisers. Western Union will also leverage this technology to purchase inventory as an advertiser itself. This move positions Western Union to monetize its substantial customer base in a manner most of its competitors haven't yet explored. We like it.

FTC v. Meta live: the latest from the battle over Instagram and WhatsApp - Meta's antitrust case continues as the US Federal Trade Commission tries to prove that Meta illegally built a social media monopoly by purchasing Instagram (2012) and WhatsApp (2014) as part of a "buy-or-bury strategy" to eliminate the competition. The FTC says the apps would have become major competitors had Meta not bought them. Experts testified that Instagram and WhatsApp could indeed have been highly successful if they hadn't been acquired by Facebook, while CEO Mark Zuckerberg testified that Facebook made them better. Instagram co-founder Kevin Systrom took the stand, describing the app's meteoric early growth and how that growth didn't slow until after Meta bought it. Apple, Google, and Twitter also wanted to buy Instagram. 

DoubleVerify Threatens to Sue Adtech Watchdog Check My Ads For Alleged Defamation🔒- DoubleVerify has threatened litigation against ad tech watchdog Check My Ads over alleged "defamatory statements" related to a March Adalytics report which suggested that verification vendors miss bot traffic. The legal letter from Brad Bondi (brother of US Attorney General Pam Bondi) demands preservation of all communications about DV and Adalytics. The legal letter claims Check My Ads' statements constitute "defamation, tortious interference, and injurious falsehood," but Adweek couldn’t identify the statements in question. Sadly, Check My Ads co-founder Nandini Jammi announced her departure days after receiving the letter, but didn’t specifically mention the letter as a reason. This reeks of legal intimidation being used to silence legitimate industry criticism.

Other Notable Headlines
(that you should know about too) 🤓 

Meta could take a $7 billion hit this year because of Trump’s tough China tariffs - Tariffs are driving Chinese retailers like Temu and Shein to cut their ad spending on Google, Facebook, and Instagram.

Here’s how agencies have been setting themselves up as tariff war partners - Agencies are quickly adapting to President Trump's tariffs, with global agency Dept creating a strategic "think tank" and Stagwell's Allison establishing a dedicated monitoring committee.

Cadent Sets a New Standard for Predictive Advertising, Launches Unified Platform - The platform combines the capabilities of Cadent and the performance platform Cadent acquired last year, AdTheorent. Here’s what the new branding looks like:

Inside WPP's $150 million InfoSum purchase🔒- We now know the number. 🤯

MidOcean Agrees to Buy GSTV from Dan Gilbert-Backed Rockbridge - GSTV, once known as Gas Station TV, runs a network of screens with video ads at gas stations across the US, valued at $500M-$600M.

Why brands and agencies are putting AI chiefs in their C-Suites - In the last year, companies like GM, Mastercard, Stagwell, Horizon Media, and Zefr have added chief AI officers for their knowledge in generative AI, agents, and automation.

Roku Unveils Partnership with Adobe Real-Time Customer Data Platform Collaboration - The integration with Roku Data Cloud and Adobe's Real-Time Customer Data Platform (CDP) Collaboration solution will help advertisers and publishers securely work together to discover, activate, and measure audiences.

Jimmy Fallon to Host Marketing Competition Series at NBC - “On Brand With Jimmy Fallon” will see Fallon launch a marketing agency that will feature Bozoma Saint John, and brands working together on campaigns. 

That’s It For This Week 👋

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