The WiR: Top British Advertisers Call YouTube Summit Meeting Over Brand Safety, Ericsson Warns of €1.5bn Q1 Hit as it Presents Refocused Strategy, Channel 4 Escapes Privatisation


In this week’s Week in Review: top British advertisers call YouTube summit meeting over brand safety, Ericsson warns of €1.5bn Q1 hit and Channel 4 escapes privatisation, but not relocation. To receive a weekly summary of industry news and other VAN interviews and videos, sign up to the weekly Video Round-Up

Top Stories

Top British Advertisers Call YouTube Summit Meeting Over Brand Safety
About 20 leading British advertisers, led by trade body ISBA, have met Google for hastily-convened talks about YouTube’s brand safety crisis. It is believed most of the advertisers who attended were those that have been directly affected by the ongoing storm about ads appearing in front of extremist and other inappropriate content on YouTube.

Ericsson Warns of €1.5bn Q1 Hit as it Pulls Out of Media
Ericsson has announced that it could record up to €1.57 billion in costs in Q1 as a result of write-downs, restructuring charges and “recent negative developments”. The company now aims to pursue a more focused business strategy to “revitalise technology and market leadership, improve group profitability and enable customer success.” Specifically it is likely to pull out of media to focus on 5G, IoT and the cloud, whilst continuing to support the global rollout of 4G.

Channel 4 Escapes Privatisation But Government Pushes Broadcaster to Relocate
Culture secretary Karen Bradley has announced that the Government has ruled out privatising Channel 4, but the state-owned broadcaster must relocate some or all of its operations outside London. The broadcaster welcomed the decision against privatisation, but said a major move would be “highly damaging to Channel 4’s business model and diminish our investment in the creative industries around the UK and our overall contribution to the UK economy”.

The Week in Publishing

BT Fined Record £42m by Ofcom Over High-Speed Installation Failure
BT has been fined £42 million by Ofcom for failing to install high-speed lines, the largest penalty the regulator has imposed. The company is reported to be setting aside a further £300 million to repay other telecoms brands compensation. Ofcom found that BT broke rules put in place to stop its subsidiary Openreach abusing its “significant market power” by cutting compensation payments to rivals, falsely blaming installation delays on factors beyond its control.

JP Morgan Trials Programmatic Whitelisting
JP Morgan has switched programmatic strategies, embracing a roster of around 5,000 ‘whitelisted’ sites, down from a list of close to 40,000. The company claim the strategy, a response to recent concerns about brand safety, has so far had little impact on their CPMs according to the New York Times.

UK Investment Association Calls on Top Indices to Bar Snap and Other Companies with No Voting Rights
The UK Investment Association (IA) has written to FTSE Russell, MSCI Global and S&P Dow Jones arguing that companies with differential share ownership structures or rights should not be included in the indices. The IA, whose 200 members include the likes of Aberdeen Asset Management, Henderson and Legal & General, wants indexes to only include companies that allocate “control of a company in direct proportion to total economic interest and the level of exposure to investment risk,”.

Daily Mail UK’s Biggest Ad Blocking Loser for 2016
The Daily Mail lost more money to ad blocking in 2016 than any other site in the UK, according to AdBack. The ad blocking analytics site report that ad blocking denied The Daily Mail just over £16 million last year in revenue. No other upper tier media brand appears in the top ten, until the BBC at 11th, followed by newspaper sites The Telegraph (15th), The Independent (17th) and The Guardian (18th).

Facebook Launches Shoppable ‘Collection’ Ad Format for Mobile
Facebook has launched its new mobile shopping ad format ‘Collection’, in an effort to help marketers “drive product discovery and sales”. Similar to their Canvas ad format, Collection takes users who click through to a full-screen display within Facebook that showcases up to 50 products sorted by relevance to the user. The ad format is supported by a metric to measure the number of outbound clicks each ad receives.

Twitter Considering Paid Membership Option
Twitter is considering a paid, premium service aimed at businesses and power users, the BBC reports. Paying members would get access to an enhanced version of Tweetdeck, Twitter’s souped-up interface that offers more functionality than Twitter.com. The social media platform is carrying out surveys to “assess interest” in the idea, as it searches for revenue growth in the face of stagnating user numbers.

Snapchat Could be Bigger than Twitter by 2020
Snapchat could become more popular with advertisers than Twitter, Yahoo and AOL within three years, ADTV Report. eMarketer forecasts that the messaging app will bring in revenues in excess of $3 billion a year before the end of 2019, due to its dominance of video using youth audience. At present, 51 per cent of video users on Snapchat are under 24, compared with 23 per cent for Facebook and 17 per cent for Google’s YouTube.

Video Advertising Outperforms Desktop Display on Viewability
Video advertising outperformed desktop display in 2016, Integral Ad Science report. Most notably, video viewability showed significant improvement, increasing from 40 per cent to 58.2 per cent when comparing H1 2016 to H2 2016, while the completion rate in view increased from 26.7 per cent to 35.1 per cent. However, with the advent of fake news and the increase in violent and extremist content and videos, brand safety remains a critical issue for advertisers, underscoring the need for a solution to protect brand reputations.

Sky Tops the Adspend Table Again
Sky was the UK’s top spending advertiser in 2016 again, increasing year-on-year spend by 18 per cent to £287m, according to Nielsen. Procter & Gamble retained second place in the table with a combined adspend across its health and beauty and household brands of £224m, up 28 per cent. However, Unilever’s adspend was down by almost a quarter. Amazon entered the top 20 spenders in 2016 with a leap from £52m to £101m.

YouTube’s Automatic Captioning System Starting to Describe Sound Effects
YouTube has expanded its automatic captioning for video to include captions for some sound effects. The video service can now detect sound effects in videos and add the captions [APPLAUSE], [MUSIC], and [LAUGHTER]. YouTube says it is in the early stages of improvements for its deaf and hard of hearing users, with captions for ringing, barking, and knocking soon to come.

French Watch More TV on Mobile Devices than on Any Other Digital
Nearly 40 per cent of all time spent watching TV content digitally in France was done via a mobile phone or tablet last year, while 31 per cent was done on a connected TV, according to the Centre National du Cinéma et de l’Image Animée (CNC). Meanwhile, the share of digital TV watched on computer has declined dramatically, falling from 71 per cent in 2011 to just 29 per cent in 2016.

Spotify Acquires Content Recommendation App MightyTV to Boost Personalisation and Data Offering
Spotify has acquired content recommendation system MightyTV. Announcing the deal, Spotify said that MightyTV founder and CEO Brian Adams would join as vice-president of technology, focused on advertising and marketing technology solutions. Spotify will integrate MightyTV’s recommendation engine with its proprietary data management platform, allowing Spotify’s ad products team to leverage listener data and other third-party assets to serve personalised ads to users programmatically.

Johnston Press Reports £300 Million Pre-Tax Loss After Huge Writedown amid Fall in Ad Revenue
Regional publisher Johnston Press has reported a £300 million pre-tax loss for 2016. The company said that difficult trading conditions had forced a writedown of regional titles and other print assets by a total of £344 million. Total advertising revenue is down 17.7 per cent year on year to £122.6 million, driven by a 9.5 per cent fall in print ad revenue.

Twitter Introduces Pre-Roll Ads to Periscope Videos
Twitter will now run pre-roll ads on its video streaming service Periscope. The social media company says the ads on Periscope videos as “a new way to use live and on-demand video to reach audiences at the most relevant moments”. The ads are currently available to “select advertisers” through Amplify, Twitter’s pre-roll video ad service, and will roll out further over the next few months.

Facebook Rolls Out Three New Snapchat Style Features
Facebook has introduced three new camera-centric features to its main Facebook app, effectively duplicating some of Snapchat’s most popular features. The additions are known as Camera, Stories, and Direct, and the company said the new features will be available to its 1.9 billion global users this week.

Advertising Aligned with News Brands 85 Per Cent More Likely to Attract New Customers
Advertising messages that are aligned to newsbrands are 36 per cent more likely to deliver “very large” profit growth and 85 per cent more likely to generate customer acquisition, according to Peter Fields and Newsworks. The study found that newsbrands delivered long-term effects for advertisers which boosted profit and penetration.

Digital Set to Overtake Traditional Media Ad Spending in Ireland
This year will mark a major milestone for ad spending in Ireland as digital surpasses all other forms of advertising, eMarketer forecast. In 2017, digital ad investment in Ireland will leap by 12 per cent to €433 million, equal to 51.4 per cent of the country’s total media ad spending. eMarketer estimates that mobile will constitute 62 per cent of all digital ad spending in Ireland this year, and represent nearly 80 per cent of digital investment by 2021.

The Week in TV

Broadcasters Boosted by YouTube Brand Boycott
Channel 4, ITV and Sky have seen a jump in ad revenues for their video-on-demand platforms as a result of advertisers boycotting YouTube. Campaign estimates the three broadcasters have been bringing in an extra £1m a week in VoD ad sales between them over the past two weeks. Sources suggest each of the broadcasters has enjoyed a rise in the high six figures during that period.

Digital Economy Bill May Mean UK Retransmission Fees
The upcoming UK Digital Economy Bill could see public service broadcasters, such as ITV charged retransmission fees. Section 73 of the Bill states that public service broadcasters such as ITV, must make their channels available to the cable networks, but cannot claim payment for them. The repeal of Section 73 thus paves the way for the PSBs to threaten to withdraw their channels from cable networks unless they have a commercial carriage agreement in place.

Three Fifths of US Pay TV Subs Don’t Like Personalised Ads
Advertisers that use viewers’ personal data to serve ads concern 59 per cent of pay TV subscribers in US broadband households, according to Parks Associates. Nearly 40 per cent of pay TV subscribers worry about the safety and use of their personal data when they use an online video service and this figure looks set to grow.

ComCast Plans Low-cost Xfinity Instant TV Offering
ComCast is reportedly planning to launch a low-cost TV package, called Xfinity Instant TV, aimed at high-speed internet customers. The service is slated for a third quarter rollout, said Reuters.

Internet Ad Spend to Surpass TV This Year
The amount of money spent on internet advertising will surpass traditional TV advertising for the first time this year, according to Zenith. The company predicts that global internet advertising expenditure reach US$205bn in 2017, compared to US$192 billion for TV advertising. “Internet ad spend grew 17 per cent in 2016, down from 20 per cent in 2015, and we expect growth to slow to 13 per cent in 2017, 12 per cent in 2018 and 10 per cent by 2019 – though it will continue to add US$23bn-US$24bn a year,” said the report.

Vivendi Reacts to ACGOM Competition Probe on Mediaset Holding
Vivendi has argued that any action against it by the Italian competition watchdog ACGOM, based on the French media group holding of significant stakes in both Telecom Italia and Mediaset, would imply a rewriting of existing rules and could be discriminatory. ACGOM had previously held that the acquisition could be in breach of the Testo Unico dei Servizi di Media Audiovisivi e Radiofonici (TUSMAR) rule.

Analysts Warn of Tough Times Ahead for ITV
ITV’s performance looks set to worsen as a result of a Brexit-related economic slowdown and increased costs related to next year’s football World Cup, according to Berenberg. Analysis suggests the broadcaster is likely to face a continued deterioration in the media buyer outlook for the UK TV advertising market. On the positive side, Berenberg noted that ITV’s management is reducing programming expenditure this year by about £25 million, helped by the lack of big sports events.

Ooredoo Oman Taps Netgem to Launch Multiscreen TV
Middle East service provider Ooredoo Oman has engaged TV tech outfit Netgem to deploy a multiscreen TV service in Oman. The Netgem-powered multiscreen TV-as-a-service will offer Ooredoo Oman customers a range of programming, including English and Arabic channels, and VOD services. A connected user interface will allow users to access content across multiple devices.

TV Adspend Forecast to Fall in 2017
UK television adspend is set to fall for the first time since 2012, Zenith forecast. The Publicis Groupe media agency expect TV spend to fall by two per cent to £3.93 billion this year. Zenith said TV spend will drop by seven per cent in the first quarter of the year but the decline will slow to One per cent in Q2.

Non-pay TV Homes in North America to Double
Pay-TV penetration in Canada and the US is projected to drop from the peak of 87.4 per cent in 2013 to 75.2 per cent by 2022 according to Digital TV Research. The number of pay-TV subs is expected fall by ten million in the ten years between 2012 and 2022. At the same time, the number of non-pay homes will climb from 20.69 million to 41.56 million over the same period.

US Viewers Would Prefer A La Carte Pay TV
US consumers would prefer a TV service model where they select, and pay for, only the individual networks they’re most interested in watching, Hub Entertainment Research report.
When respondents were allowed to cherry pick networks at different price points, the research showed that US viewers object more to paying for content that they don’t use than to the overall price itself. Hence SVoDs are perceived to provide especially good value compared to traditional pay TV packages.

Only Four Per Cent of Rural Americans Exclusively OTT Subscribers
Whilst the trend of “cord cutting” in the US is strong in urban and suburban areas, the number of rural homes that are getting all of their video over the Internet is a modest 4 per cent, Innovative Systems report. Although the overall subscription rate remained the same at 82 per cent, the number of homes that have cut the video cord has increased, rising from one per cent to four per cent in 2017.

The Week in Ad Tech

YouView Develops AdSmart-style Targeted Advertising
YouView is working on a project to offer addressable linear or dynamic ad insertion, according to the UK TV platform’s commercial projects director Simon Cook. Speaking at TV Connect in London, Cook said that YouView is working to provide an “AdSmart-like capability to target ads to the set-top box”. The move promises to help BT and TalkTalk – both of which use the YouView platform – start to compete more directly with Sky on the advertising front.

AffinityAnswers Expands to The UK and Germany
Predictive branding platform, AffinityAnswers, will be expanding its offerings to the UK and Germany programmatic data markets. At launch, AffinityAnswers is offering about 150 pre-populated audience segments, with customised segments available within three to six weeks.

Rubicon Project Fires Back Over Guardian Lawsuit
The Rubicon Project has issued a firm rebuttal to The Guardian plans to sue for undisclosed buyers fees, stating that the company’s charges are disclosed in a contract signed with publisher more than a year ago, and are stated publicly in SEC filings. The ad tech firm says it intends to vigorously contest the lawsuit in court.

Marketers Must Tell Boards ’60 Per Cent of Programmatic Spend is Wasted’
Ebiquity has urged marketers to face up to the fact that 60 per cent of their programmatic ad spend is being wasted. Michael Higgins, the company chairman, stated “only about 40 per cent of digital programmatic advertising investment reaches the consumer.”, an erosion of value he blamed on multiple links between advertisers and publishers, fraud, lack of viewability and non-human traffic.

The Week for Agencies

Grey London Becomes Valenstein & Fatt to Promote Diversity and Tolerance
Grey London is making a statement against a recent surge in racism and nationalism by changing its name to Valenstein & Fatt, with the surnames of its two Jewish founders appearing above the agency’s doors for 100 days. The agency has also committed to regularly publish its diversity data, and is launching a cross-industry taskforce to identify the barriers to staff recruitment and retention among ethnic minorities.

Auto-Play Video and Pop-Ups Most ‘Annoying’ Formats
Pop-up ads, auto-play video ads with sound, and “prestitial” have been ranked amongst the most annoying for both desktop and mobile advertising, according to the Coalition For Better Ads. The group released their report detailing the ‘most disruptive’ ad formats for mobile and desktop in the hope that the results will be used by the industry to improve user experience.

Partnerships of the Week

GroupM Partners with OpenSlate to Tackle Brand Safety on YouTube
Media investment agency GroupM has partnered with OpenSlate in an effort to address controversy surrounding brand safety on YouTube advertising. GroupM has recently urged clients to be mindful of working with the platform, but recommends brands work with Google to achieve acceptable safety standards. To this end it has engaged OpenSlate, whose data platform scores YouTube content for quality and brand safety.

Zoomin Studios Signs Co-Production Deal and US Agent in Advance of MIPTV 2017
Zoomin Studios, the format creation division of Zoomin.TV, has announced its co-production partnership deal with Off The Fence Productions. Zoomin Studios is also expanding into North America with a representation deal with Paradigm Talent Agency.

Hires of the Week

OpenX Appoint Trigg as Vice President for EMEA
OpenX have appointed Dominic Trigg as vice president, EMEA. Prior to joining OpenX, Dominic was senior vice president and general manager of EMEA and emerging markets at Rocket Fuel. OpenX have also promoted Richard Kidd to vice president, head of business development, EMEA.

TabMo hires Dan Read from Mobsta
Mobile advertising company TabMo has recruited Dan Read from Mobsta for its newly-created role of head of trading and platform sales. As part of the team expansion, it has also promoted Shanil Chande to head of agency sales.

This Week on VAN

How is VR Marketing Faring One Year after the Release of the Oculus Rift? Read more on VAN

GroupM Partners with OpenSlate to Mitigate YouTube Brand Safety Risks, read more on VAN

The Guardian is Suing Rubicon Project for Allegedly Failing to Disclose Buy-Side Fees, read more on VAN

OTT Company Falcon Media House Starts Trading on London Stock Exchange, read more on VAN

 

Ad of the Week: Samsung, Ostrich


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