The WIR: Twitter Predicts Profitability, Spotify Scraps Original Video Content, and Telecom Italia Launches New Joint Venture with Canal+


In this week’s Week in Review: Twitter aims for its first profitable quarter, Spotify allegedly scraps its original TV shows, and Telecom Italia and Canal+ launch a new joint venture. To receive an update on the industry’s top stories every Friday, sign up to the weekly Video Round-Up.

Top Stories

Twitter Veers Towards Profitability and Programmatic Offering
Twitter’s Q3 results released this week which showed signs of a turnaround for the company, which experienced persistent revenue growth decline recently. While revenue saw a 4 percent year-on-year decrease to $590 million, quarterly GAAP net loss was $21 million, far lower than the $103 million loss in the same period last year, and Twitter’s leadership forecast that Q4 this year “will likely be GAAP profitable”. Twitter says it is working to return to revenue growth, with “new channels of demand, such as online video, and introducing new ways to buy ads on Twitter including alpha testing of programmatic buying” listed as sources to boost income.

This announcement was followed by news that Twitter has banned russian publishers RT and Sputnik from buying its inventory, after allegations of Russian sources interfering in the US election last year. Twitter said the decision was based on “the retrospective work we’ve been doing around the 2016 US election and the US intelligence community’s conclusion that both RT and Sputnik attempted to interfere with the election on behalf of the Russian government”.

Spotify Reportedly Cancelling Original TV Shows
A report from Bloomberg suggests that Spotify is reworking its video strategy as it’s newly installed head of video and podcasts Courtney Holt seek a fresh direction. Citing “sources with knowledge of the matter”, the article claims that Spotify is cancelling plans to produce original video series for the service, instead opting for a new format unique to Spotify. Reportedly Holt is searching for new ways to generate ad sales without the same high royalty and distribution costs Spotify currently pays, which are equal to 80 percent of revenue.

Telecom Italia and Canal+ Launch New Joint Venture
Telecom Italia are launching a new joint venture with Vivendi’s pay-TV unit Canal+ which will see the two work together on rights acquisitions and production of films and TV series. The joint venture, which will be 60 percent owned by Telecom Italia and 40 percent by Canal+, will launch a new pay-TV offering in Italy both in linear and nonlinear formats.

“The joint venture with Canal+ will in fact allow us to seize new opportunities for growth in a market undergoing continuous evolution through a commercial offer of fiber connectivity combined with premium video content,” Telecom Italia’s chief executive Amos Genish said in a statement.

The Week in Tech

Wibbitz Raises Completes $20 Million Funding Round
AI-powered video creation platform Wibbitz announced on Wednesday it has raised $20 million in Series C funding, led by Bertelsmann Digital Media Investments and with participation from The Weather Channel television network, The Associated Press, TF1 Group, and existing investors including NantMobile, lool Ventures, and Horizons Ventures. Wibbitz said in a press release that the financing will be used for key hires across its development, product, design, sales, marketing, support and in-house editorial teams, and will also be invested in advancing artificial intelligence technologies and automation capabilities of its web-based platform.

Connatix Raises $15 Million
Video platform Connatix has secured $15 million in series A funding, it revealed this week. The company said in a press release that the funds will be used to accelerate growth and for development of new products. Volition Capital led the round of funding and Larry Cheng, Managing Partner at Volition Capital will join Connatix founders David Kashak and Oren Stern on the board of directors.

The Trade Desk Acquires Adbrain’s Assets
Programmatic ad buying platform The Trade Desk announced on Wednesday that it has bought the assets of Adbrain, the cross-device customer ID mapping technology company who claim to have mapped 90 percent of the adult internet population in the US. The terms of the deal have not been disclosed, though it is not expected to have an impact on quarterly financial results according to a statement. Read the full story on VAN.

Rubicon Project Launches Open Source Server-Side Header Bidding
Rubicon Project announced on Wednesday the launch of an open source server-side header bidding solution in closed beta as part of its commitment to the Prebid.org project. Prebid.org is a group of ad tech companies dedicated to the development of open source seller monetization tools, and Rubicon Project says this new offering is based on standards that are neutral, adaptable and transparent to all industry players. The new solution supports desktop browser and mobile web, with mobile app and video functionality expected in early 2018.

“In order for header bidding to be sustainable, the industry requires solutions that offer solid user sync and match rates, adoption rates at scale, full transparency of auction dynamics and the ability to transact in open and private marketplaces. Our open source solution announced today addresses all of these requirements, while providing our clients with white-glove service and support,” said Pieter de Zwart, VP of Engineering at Rubicon Project and President of Prebid.org in a statement.

Facebook Tops AppsFlyer Performance Index
Mobile marketing analytics and attribution platform AppsFlyer’s H1 performance index, which ranks the best media sources in mobile advertising, has put Facebook as its top performer in both its gaming and non-gaming categories. Facebook and Google have always topped the list, which measures the number of “clean” installs generated by each media source, but the two are “dominating the mobile ad space like never before” according to the report.

 

AdScribe Begins Interactive HbbTV Advertising in Switzerland
AdScribe in partnership with Swiss marketing company Admeira has begun delivering interactive TV ads using HbbTV on select Swiss channels. The ads, built on AdScribe Engage, give viewers the ability to interact directly with commercials, browse additional content, watch videos, and enter competitions.

The Week in TV

Netflix to Raise $1.6bn for New Original Content
After revealing last week its plans to spend up to $8bn on new content in 2018, Netflix announced a bond sale where it hopes to raise $1.6bn to help fund the content drive. Netflix has had a strong year so far, with its share price rising 50% this year as subscriber growth beat market expectations, though it also plans to raise its subscription cost in the UK and US to help cover the cost of its content spending.The interest rate and maturity date of the new bonds have yet to be decided, Netflix said in a statement.

TV Sponsorship Effective for Brands says Channel 4
Channel 4 announced the results this week of what it calls the most comprehensive study into the effectiveness of TV sponsorship ever conducted, and concludes that TV sponsorship delivers legitimate value for brands.Channel 4 commissioned independent research agency Consumer Insight to aggregate 107 individual Channel 4 sponsorship studies across its flagship programme brands and strands. Results show that 89 of audiences trust brand sponsorship more than other forms of advertising, 91 percent see brands that sponsor content as more premium than others, and that 91 percent see brand sponsorship as the future of advertising.

Giants of SVOD Struggling in MENA
A report from IHS Markit released this week shows that Netflix and Amazon Prime Video are struggling in the MENA region, where they comprise just 21 percent of the market together. SVOD adoption has been slow in the region due to factors like widespread piracy and low bankcard penetration, and local SVOD services like Icflix, Seevii, OSN’s WAVO and MBC’s Shahid Plus are providing strong competition for Amazon and Netflix.

Gambling Ads in Over 95 Percent of UK Football Ad Breaks
A BBC study has found that 95 percent of ad breaks during football matches show at least one gambling ad, and that a fifth of all ads shown promoted betting companies. Gamblings ads are lucrative according to the BBC, with betting firms spending £150m a TV ads in 2016, but the government is considering tightening regulations, with a report expected as early as next week.

Over Half of US Households Have both Pay-TV and OTT Subscriptions
Parks Associates’ report, ‘OTT Video & TV Everywhere: Partners, Alternatives, and Competition,’ finds that 53 percent of US broadband households have subscriptions to both a pay-TV service and at least one OTT service. “Many OTT services are evolving to be complementary to the market’s largest players, instead of trying to compete directly against Netflix, Amazon, and Hulu,” said Brett Sappington, Senior Director of Research at Parks Associates in a statement.

The Week in Publishing

Facebook Trials Removing Non-promoted Media Posts from Newsfeed
Facebook has begun trialling a system whereby only promoted media posts appear on users’ newsfeeds, a change that could see some page’s reach drop dramatically. The new system sees almost all non-promoted posts shifted over to a secondary feed, with the main feed reserved for friends’ posts and paid promoted content. Pages from the six countries where the trial is taking place have reported a 60% and 80% fall in reach.

“The goal of this test is to understand if people prefer to have separate places for personal and public content,” Facebook said via a blog post. “We will hear what people say about the experience to understand if it’s an idea worth pursuing any further. There is no current plan to roll this out beyond these test countries or to charge pages on Facebook to pay for all their distribution in News Feed or Explore.”

The Week for Agencies

Ad Agency Executives Arrested in Pakistan
A number of executives from ad agencies in Pakistan, including Oritentm McCann’s president Masood Hashmi, were arrested earlier this week in connection with an ongoing investigation into a corruption scandal worth $55 million. The seven executives are claimed to have been awarded contracts without due competition due to collusion with Sharjeel Memon, the former information minister of Sindh province in Pakistan.

McDonald’s Begins Global Media Agency Review
McDonald’s is reviewing where it spends its $2bn media budget with a global media agency review, its first in ten years. McDonald’s current media agency OMD will be part of the process, but the fast-food chain expects to transition to working with a number of partners rather than just one.

“As part of our journey to build a better McDonald’s we are striving to make our marketing dollars work harder—through more efficient media spending and better connections with our customers,” a company spokesman said in a statement.

Partnerships of the Week

Sharethrough Agrees New Integration with Adobe Advertising Cloud
Sharethrough has agreed a new integration with Adobe Advertising Cloud which will allow marketers using the Adobe Advertising Cloud DSP to access audiences with in-feed native video and display placements across over 1,200 sites and apps on the Sharethrough Exchange. The integrations will run off the IAB’s OpenRTB 2.3 spec that standardised the component parts for the real-time trading of native ads.

Sublime Skinz Partners with IAS for Improved Viewability
Sublime Skinz on Thursday announced a partnership with Integral Ad Science to improve the measurement of its skin-based ad formats. IAB measurements have found that 93.3% of Sublime Skinz’ desktop ad units achieve the MRC standard for viewability, according to a statement. Sublime Skinz says they have achieved performance improvements thanks to the partnership, with 67.1% of the Sublime Skinz’ desktop ad formats now viewable for 15 seconds or more.

Beenius and iPROM Partner for Programmatic Advertising in Digital TV
Ad tech companies Beenius and iPROM have teamed up to create what they call a programmatic advertising service for digital TV, aimed at the Southeast Europe region. iPROM’s ad serving technology will be integrated into Beenius’ TV platform, which will be available for Beenius’ full range of ad formats.

Orange Chooses Harmonic for Combined IPTV and OTT Delivery Services
Video delivery tech company Harmonic has been chosen by Orange to provide a live encoding and transcoding platform for its IPTV and OTT platforms. Harmonic’s Electra software-based system will deliver Orange’s services to approximately 6.6 million subscribers in France, according to a statement.

TiVo and Liberty Global Renew Product Agreements
TiVo announced on Thursday that Liberty Global has renewed its existing product agreements and signed a multi-year extension to their intellectual property license, providing Liberty Global with expanded access to TiVo’s patent portfolios.

Hires of the Week

Apple Hires Jay Hunt as EU Creative Chief
Apple has hired Jay Hunt as creative chief of its European video operations, a move which analysts see as Apple gearing up to take digital rivals like Amazon and Netflix. Hunt has previously held senior roles at BBC and Channel 4, and was responsible for Channel 4’s £75 million purchase of The Great British Bake Off.

Randy Freer Succeeds Mike Hopkins as Hulu CEO
Mike Hopkins is stepping down as CEO at Hulu and will be replaced by Randy Freer, who has Fox Networks Group president and COO since 2013. Hopkins is moving on to Sony where he will be chairman of Sony Pictures Television.

Nimbletank Appoints Paul Vallois as Managing Director
Mobile ad agency Nimbletank appointed Paul Vallois this week as managing director as it looks to branch out from its mobile and native roots.

The Week on Van

Holistic Campaigns Need More Consolidation Across Investment Teams says Adobe’s Toccara Baker, read more on VAN

“Broadcaster Quality” Content is as Important as Brand Safety says Glomex’s Michael Jaschke, read more on VAN

Lack of Pre-testing by Advertisers “Absolutely Criminal” says Teads’ Marc Zander, read more on VAN

New Pre-roll Formats Still Less Effective than In-stream says Sublime Skinz’s Andrew Buckman, read more on VAN

How DOOH is adopting programmatic, read more on VAN

Misconceptions Around Blockchain are Holding it Back says MadHive’s Stacy Huggins, read more on VAN

Video’s Next Frontier: eSports & Gaming, read more on VAN

The Trade Desk Acquires Adbrain’s Assets, read more on VAN

How will GDPR Change the Media Landscape? read more on VAN

How Will the Video Ad Industry Look in 2022? read more on VAN

Ad of the Week

Old Spice, Rick and Morty Sponsored Content
This  isn’t the first piece of sponsored content to make a joke of its own “selling out”, but the style of humour is so in line with Adult Swim’s third wall-breaking Rick and Morty that this feels more like a clip from an episode than an actual advert.


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