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Articles by: "Jason Kint, CEO – DCN"

-crumbling roads leading to a Google-like G to suggest the end of the open web from AI Mode-
AI | Audiences | DCN-Research | Featured Post | Policy

Facts: Google’s push to AI hurts publisher traffic

The numbers are in – and they are damning. DCN’s latest member-survey shows median year-over-year referral traffic from Google Search to premium publishers down 10% over just eight weeks. Non-news brands took the biggest hit, down 14%. News brands fell 7%. Declines outnumbered gains two-to-one, most in the -1% to -25% range. 

The worst weeks were brutal: news brands plunged 16% the week of May 25th; non-news fell 17% the week of June 22nd. Mind you, these aren’t random fluctuations. They are sustained losses hitting both breaking news publishers and evergreen entertainment brands. And let’s not forget that this is the exact content Google’s AI is trained on and now replaces with its own summaries. The company that has long draped itself in the flag of the open web is now trampling it, trading the public square for a walled garden built on monopoly profits.  

From search “partner” to search competitor 

Over the past year starting in May 2024, Google has been rolling out AI Overviews, now AI Mode. These AI-generated answers, in which Google synthesizes publisher content into Google’s own product, sit at the very top of search results. This transforms what has long been the discovery engine for our daily lives into a place where all traffic dead ends at Google. Searchers get an answer and the click to the source vanishes. Of course, that’s the point. Google wins. 

The Pew Research Center recently confirmed what DCN’s member data makes plain: when AI Overviews are present, users are significantly “less likely” to click on links to publisher websites. Instead, they stay on Google, consuming summaries pulled significantly from Wikipedia, Reddit, YouTube, and work of premium publishers, all of whose content the AI is paraphrasing.  

This is the definition of what has long been called a “zero-click” environment. In this system, the platform harvests and delivers information without sending the reader to those who actually created it, often at significant cost and always with the intention of serving their own audiences. For premium publishers, it means fewer readers, ad impressions, and subscription conversions. For the open web, it means less discovery, diversity, and accountability in the information ecosystem. 

Google’s sunny story – and the cloudy reality 

On August 6th, Google published a blog post proclaiming (arguably gaslighting) that “AI in Search is driving more queries and higher-quality clicks.” The tone, utterly unsupported by data, suggests that publishers should be thrilled. 

The reality drawn from DCN’s member data – which spans 19 companies, from major national newsrooms to global entertainment brands – tells quite a different story. Over eight weeks in May and June 2025, the median Google Search referral was down almost every week, with losses outpacing gains two-to-one. For non-news brands, the downward slope was steady and unbroken. 

This isn’t noise. It’s a structural change in how Google distributes (or withholds) traffic. And it comes as Google sits on more than 95% of the mobile search market, with a pending remedies order from Judge Amit Mehta in the landmark U.S. v. Google Search antitrust case. Unless Judge Mehta adopts the Justice Department’s proposed publisher safeguards and immediately restricts Google’s tying of AI training of AI Overviews to search inclusion, the “recidivist monopolist” will keep publishers in handcuffs. 

Why this matters for the future of journalism and entertainment 

For DCN members, 78% of digital revenue still comes from advertising. That revenue depends on reach. Every point of search traffic lost to AI modules squeezes the budgets that fund investigative reporting, global coverage, and ambitious entertainment.  

In terms of advertising monetization, this continues a trend DCN has been monitoring for the last decade. During this period, Google’s advertising revenues have shifted from a 50/50 split with the rest of the web to surpassing more than 90% last quarter for the first time. 

And the harm isn’t limited to media companies. When Google’s AI modules surface information from unverified or lightly moderated sources like Reddit or YouTube – sometimes above trusted, accountable outlets – users get convenience at the expense of quality. It’s a degradation of the public information supply, dressed up as innovation. 

A familiar pattern, with a dangerous twist 

This certainly isn’t the first time platforms have siphoned value from publishers. Google’s featured snippets, Accelerated Mobile Pages (AMP), and Facebook Instant Articles all promised to improve the user experience. And all ended up centralizing control and weakening the economics of publishing across the open web. 

The difference now is intent. Google’s AI results don’t just excerpt; they replace. Pew’s research shows many users stop at the AI answer. That’s direct substitution, without fair bargaining or licensing, and it maps to the declines DCN measured. 

Even breaking news, which DCN members suggest is still somewhat protected from AI Overviews, isn’t entirely safe. As the AI models improve and update faster with daily training, even those moments of publisher advantage may vanish. 

What needs to change 

  • Transparency: Google must disclose auditable data on AI Overview click-through rates by query type, content category, and geography. 
  • Real opt-out: publishers need a way to block use of their content in AI answers without sacrificing search visibility. 
  • Fair licensing: if OpenAI, Amazon, News Corp, The Guardian, The Atlantic, and others can make licensing deals, so can Google. It’s an emerging, important market for publishers. 
  • Regulatory oversight: treat AI Overviews and AI Mode as part of Google’s search monopoly. A monopoly self-preferencing is not innovation; it’s foreclosure. 

The choice ahead 

Premium journalism and entertainment don’t appear by magic. They’re the product of significant investment, skilled creators, editorial standards, and increasing risk. Google’s AI rides on that work, and now threatens to cut off the audience that sustains it. 

This is not a call for special treatment. It’s a call to preserve the integrity of the open web. We must ensure that the same AI “answers” users see at the top of Google Search don’t become a free substitute for the original work they’re based on. 

If we allow the search monopoly to wall off the web behind AI-generated summaries, we’ll end up with fewer sources, weaker journalism, and a less informed public. The open web is worth defending. And the data is clear: the time to act is now. 

Audiences | Featured Post | Research | Video

Media must catch up to Gen Z’s video playbook

At some point in 2020, accelerated by the pandemic and the kids using endless hours of TikTok scrolling as a coping mechanism, short-form video surged into a major part of modern media consumption. Even for those of us who grew up on cable TV and later binged on Netflix, Gen Z is reshaping how we discover, consume, and engage with video content. Younger audiences have turned scrollable, snackable video into something so much more satisfying than a Quibi; it’s now a cultural mainstay.

That’s the wake-up call from our latest DCN research, Decoding Video Content Engagement: Gen Z & Gen Y in Focus, a two-part study conducted with Magid. We launched the project last year with in-depth, hour-long qualitative interviews to get a baseline on the latest language and media mindset of younger audiences. We then took a quantitative dive into what we now see as a landmark report for DCN and its member companies. To be clear: the numbers don’t just hint at a subtle shift. They chart a generational rewrite of what video means and what audiences expect it to do.

The headline? They don’t watch. They participate.

Simply put, video is no longer a passive experience characterized by a surge of short-form experiences on social platforms. Our research shows that 92% of Gen Z interacts with video on social platforms at least once a week – liking, commenting, remixing and sharing. But even more striking, nearly two-thirds (64%) of teens aged 13–17 create and post original video content weekly. Notably, this statistic drops materially to 40% for ages 18-22 (the back half of Gen Z). That’s a clarion call for those seeking to understand the expectations of the next wave of digital natives and why we labeled them “The Creator Generation” in this report.

For the youngest Gen Z users, “watching” isn’t a lean back experience. It’s a ticket to creative expression.  Video isn’t something they just watch. It’s something they do. This dynamic is upending the traditional hierarchies of content and control. The line between viewer and creator is fading and with it, many of the historic relationships between storytelling, advertising, and brands.

Creators are the new gatekeepers

In the past, a media brand’s value lived in logo recognition and distribution demand. Today, particularly with the youngest audiences, it’s more likely to live in the hands of creators with cultural credibility and fluency. These individual creators are now the benchmark: remarkably they beat out all other creator types in being perceived as more creative, entertaining, interesting, and informative.

These creators are not the typical influencers posting their user-generated content to make a paycheck. They are micro media empires of all backgrounds. And they’re setting the tone for what today’s audience deems engaging, real, and worth watching. All of this accumulates in more trust.

And that trust gap is telling. While 88% of younger audiences trust friends, family, and creators, traditional brands fall significantly behind even though they’re visible. Yes, 93% of Gen Z still says they often see brand content. But awareness isn’t the same as engagement. And in a world where users can scroll past your video in a second (with a paltry three seconds being the magical sweet spot for nearly half of the young users in the research), that difference can be everything.

Authenticity isn’t a bonus – it’s the baseline

If you’re still investing in glossy, highly produced videos that feel like they came from a corporate studio instead of an actual human being – stop. The bar has moved. Individual creators are not major media brands. Think about it: People are flawed. In a world where the individual creator is more trusted, entertaining and engaging, a perfectly pressed and buttoned up production will not resonate like a rumpled shirt and bit of bedhead.

Authenticity is the baseline. When asked what they value most in video content, Gen Z chose originality, honesty, and authenticity far ahead of production value or polish. This generation can smell marketing a mile away and they’ll scroll right past it – teaching the algorithm you aren’t worth their precious time.

Instead, they want content that reflects them: unfiltered, participatory, and emotionally resonant. Think behind-the-scenes looks, first-person storytelling, raw filming, and creator collaborations that feel like a natural fit rather than transactional development deal.

So, what should media companies do?

We know the stakes are high. Premium publishers – many of whom DCN proudly represents – are once again navigating a digital ecosystem shaped by generational shifts, platform upheaval, and algorithmic opacity described to our researchers innocently as “TikTok magic.” However, this moment is also an opportunity.

Here’s how media brands can strategically respond:

1. Design for engagement, not impressions

Simply showing up isn’t enough anymore. Content needs to invite participation. Whether it’s Q&As, remixable challenges, or comment-driven formats, the most successful brands treat viewers like collaborators, not consumers.

2. Co-create with cultural insiders

Want to build trust and relevance? Partner with the creators your audience already respects. Not as brand spokespeople, but as co-storytellers. This isn’t about inserting your brand into youth culture. It’s about amplifying voices that already move your audience.

3. Reimagine platform strategy

TikTok is not YouTube. Instagram is certainly not Facebook (even if it’s the same parent company). And your content shouldn’t be a one-size-fits-all proposition. Create native video strategies that reflect the tone, pacing, and expectations of each platform. If you can’t do it everywhere at once in ways that resonate on each platform then pick your platform(s) of choice based on your content, audience and opportunity.

4. Lead with values – and humanity

Gen Z and Gen Y want entertainment. But they also care about who is behind the content. Our research confirms that younger users reward brands that are transparent, socially aware, and human. If your brand voice on social sounds like it was built by a committee, it’s time to revisit the script.

5. Build with the “SHARES” formula

If you want engagement, your video content should tap at least one of the six drivers identified by our DCN research team. Our SHARES formula – which includes Storytelling, Humor, Authenticity, Raw, Engagement, and Surprise – isn’t merely a checklist. It’s a roadmap for emotional connection and engagement.

The future Is participatory

The question isn’t whether Gen Z and Gen Y will continue to redefine video. They already have. The question is whether the larger media industry will listen.

At DCN, we believe that high-quality, trusted content is more important than ever to the future. But trust now resides in how and where you show up, not just what you say. If media brands want to stay relevant, we must not only reflect the values of these generations. We must also create space for them to shape the stories themselves.

Premium media brands like our DCN members have a powerful edge: credibility, creativity, and a direct relationship with their audiences. But competing in this new era of short-form video requires humility, agility, and a willingness to let go of legacy thinking.

This isn’t a pivot to video. It’s a reinvention.

Advertising | Policy

Senate testimony: A call for accountability in digital advertising

As CEO of Digital Content Next (DCN), I testified on April 1, 2025, to the Senate Judiciary Subcommittee on Antitrust on behalf of our members—leaders in trusted journalism and premium entertainment. My testimony addressed the persistent anticompetitive behavior of dominant tech platforms, particularly in the digital advertising market. While our members come from diverse media backgrounds, they all rely on fair access to the open internet to create, distribute, and monetize original content. Yet today’s digital ad marketplace lacks basic rules, allowing tech giants to operate without accountability—fueling opaque practices, data arbitrage, and conflicts of interest that harm publishers and consumers alike.

Since my testimony, Judge Leonie Brinkema ruled that Google abused its monopoly in ad tech, with remedies now under consideration—including potentially breaking up parts of its ad business. Meta also faces an ongoing antitrust suit from the FTC. While these cases are encouraging, legislative action is essential to prevent further harm.

That’s why DCN strongly supports the bipartisan AMERICA Act, introduced by Senator Lee. The bill sets clear, common-sense rules to restore transparency, promote competition, and curb platform abuses. This will ensure a fairer digital marketplace for content creators and the public.

Key points from Jason Kint’s testimony:

Surveillance Advertising Dominance

Google and Meta built their advertising empires by embedding surveillance across the open web, exploiting content and user data without consent or fair compensation.

Market Distortion and Publisher Harm

The current ad tech system strips value from professionally created content, impairs subscription growth, and erodes trust by favoring opaque, engagement-driven algorithms.

AI Repeating the Pattern

Generative AI models are being trained on copyrighted works without permission, threatening to displace original content and replicate past harms.

Call for Policy Action

DCN supports the AMERICA Act’s measures to rein in conflicts of interest in ad tech, alongside broader calls for privacy legislation and copyright protections in the AI era.

Preserving Democratic Institutions

Without reform, unchecked platform power will continue to undermine the premium news and entertainment that consumers love.

AI and human playing chess to represent AI licensing negotations
AI | Featured Post | Policy | Revenue

The AI reckoning for publishers and platforms   

The publishing industry has been of two minds on AI’s rapid advancements – optimistic and cautious – sometimes within the same company walls. Business development teams explore much-needed new revenue opportunities while legal teams work to protect their art and existing rights. However, two major legal developments, the Thomson Reuters v. Ross Intelligence ruling and shocking new revelations in Kadrey v. Meta, expose the fault lines in AI’s unchecked expansion and set the stage for publishers to negotiate fair value for their investments. 

One case confirms that publishers have a right to license their content for AI training and that tech advocates’ tortured analysis of fair use doesn’t throw out rights engrained in the U.S. Constitution or require publishers to opt-in to attain them. The other case suggests that Meta may have knowingly pirated books in its high-stakes race to keep up with OpenAI and that Meta’s notorious growth-at-all-cost playbook is more exposed than ever. 

AI companies can no longer operate in a legal gray zone, scraping content as if laws don’t apply to them. Courts, lawmakers, researchers and the public are taking notice. For publishers, the priority is clear: AI must respect copyright from the beginning including for training purposes, and the media industry must ensure it plays an active role in shaping AI’s future rather than being exploited by it. 

Thomson Reuters v. Ross: A win for AI licensing, a loss for those who intentionally avoid it 

In a landmark decision, a federal judge ruled this month in favor of Thomson Reuters against Ross Intelligence, a startup that trained its AI model without rights or permission using the Reuters’ Westlaw legal database. 

Judge Stephanos Bibas’ ruling in the Delaware district court is notable because he explicitly recognized the emerging market for licensing AI training data. This undercuts the argument that AI developers can freely use copyrighted works under “fair use” factors. And, consistent with DCN’s policy team, it also highlights the significant importance of the fourth factor of fair use, which publishers have been demonstrating with the signing of each new licensing deal.  

For publishers, this is a crucial precedent for two reasons: 

  • AI training is not automatically fair use. Content owners have the right to be paid when their work is being used to train AI.   
  • A market for AI licensing is forming – this is the fourth factor. Publishers should define and monetize it before platforms dictate the terms.   

This decision marks a turning point, ensuring that AI development doesn’t come at the expense of the people and companies producing high-quality content.  Sam Altman of OpenAI, and other leadership across the powerful AI industry, have attempted to invent a “right to learn” for their machines. That’s an absurd argument on its face but regularly repeated in high-profile interviews, as if the technocrats might will it into reality. 

Kadrey v. Meta: Pirated Books, torrenting, and a familiar playbook 

While the Reuters ruling validates AI licensing, Kadrey v. Meta reveals how some AI developers have worked to avoid it. 

Recently unsealed court documents suggest that Meta employees knowingly pirated books to train LLaMA AI models used as their first commercial version (LLaMA2). Significantly, their fair use analysis shifted from “research” to making bank – a lot of it. 

Evidence revealed that demonstrates this knowing strategic shift: 

  • Meta employees downloaded pirated book datasets from a massive, pirated dataset, LibGen, with employees even using torrenting technology to pull it down.   
  • They may have “seeded” and distributed this pirated content to others. That’s a potential violation of criminal code that their own employees shared this, “What is the probability of getting arrested for using torrents in the USA?”.  
  • Meta worried that licensing even one book would weaken its fair use argument, so it didn’t license any at all. 
  • Some employees explicitly avoided normal approval processes to keep leadership from having to formally sign off.   
  • Some documents suggest Mark Zuckerberg himself may have been aware of these tactics with documents referencing escalations to “MZ.” 
  • Meta appears to have stopped using this material ahead of LLaMA3, possibly signaling awareness that their actions were legally indefensible.   

Making matters worse, Meta’s case is being overseen by Judge Vincent Chhabria in the Northern District of California. This is the same judge who sanctioned Facebook’s lawyers in its massive privacy settlement that led to record-breaking settlements approaching $6 billion with the FTC, SEC and private plaintiffs. In that case, Facebook was accused of stalling, misleading regulators, and withholding evidence related to its user data practices. In other words, Judge Chhabria knows Meta’s playbook: delay, deny, deflect.   

Now, Meta faces a crime-fraud doctrine claim. This means that some currently sealed legal advice could be unsealed if it was in furtherance of a crime. If proven, this would not be a simple copyright dispute; it could potentially lead to criminal liability and further regulatory scrutiny. The Court is ordering Meta to unseal more documents this week. 

Move fast, break things… again: Meta’s AI strategy mirrors its past scandals 

The Kadrey case’s revelations closely resemble Meta’s past data controversies, particularly those that were all put into the basket of Cambridge Analytica. The many ongoing details of the cover up of the scandal are still emerging today. Unfortunately, they were mostly overlooked by the tech press corp who have not been tuned in to these issues for far too long.  

For years, Facebook pursued a strategy of aggressive data harvesting to accelerate its growth in mobile where it had risk of being supplanted by new platforms. The company:   

  1. Scraped vast amounts of publisher and user data without clear consent.   
  1. Shared this data widely with developers in exchange for reciprocal access to their user data – fueling Facebook’s mobile market share grab.   
  1. Ultimately settled with regulators for billions after repeated privacy violations. 

Now, in Kadrey v. Meta, history appears to be repeating itself.  Internal documents show that Meta feared OpenAI and needed to accelerate its AI development. Thus, Meta felt pressured to take outsized risks.  Meta’s approach to AI training follows a similar pattern:   

  1. Acquire the best data – legally or not.   
  1. Use it to gain an edge over AI competitors.  
  1. Deal with legal and regulatory fallout later, if necessary. 

Recently unsealed documents even expose a documented mitigation strategy. 

  1. Remove data clearly marked as pirated (but only if it’s in the filename despite letting the coders strip out copyright info in the actual content) 
  1. Don’t let anyone know what data sets they’re using (including illegal datasets) 
  1. Do whatever possible to suppress prompts that spit out IP violations 

Key takeaways for publishers and media companies 

The Thomson Reuters and Kadrey cases demonstrate both the risks and the opportunities for publishers in the AI era. Courts are starting to push back on AI’s unlicensed use of copyrighted content. But it’s up to the publishing industry to define what comes next.   

Here are the big issues we must address: 

  1. AI models need high-quality data. And publishers must ensure they’re compensated for it. The Reuters ruling proves that a growing licensing market for AI exists.   
  1. Litigation is working. The unsealed evidence in the Kadrey case suggests that even AI giants like Meta know they’ve crossed legal lines. Facebook isn’t dumb, evidence from other peer companies may be even more damaging. The plural press needs to be shining the light on these wrongs as national security isn’t an excuse for AI companies to break copyright law. 
  1. Publishers must be proactive in shaping AI policy. Big Tech will push its own narrative. Meta and Google pay front groups like Chamber of Progress to stretch the meaning of fair use both in the U.S. and across the pond. Media companies must work together to establish AI licensing frameworks and legal protections and reinforce existing copyright law.  
  1. Regulatory scrutiny on AI will intensify. If Meta is found to have used pirated data, it will accelerate AI regulations. This will not likely be confined to copyright but could extend across tech policy as it did in 2018, when one scandal exposed larger problems leading to Facebook being dragged before parliaments around the globe.  

The future of AI depends on trust, ethics and media leadership 

The past year has shown that AI is both a disruptor and an opportunity. The Reuters ruling confirmed publishers can and should demand licensing deals. The Meta revelations prove why that’s so necessary.   

AI is reshaping media, but it must be built ethically. The publishing industry has both the legal and ethical high ground. And media companies must use it to define the next phase of AI’s evolution. The future of AI isn’t just about innovation. It’s about who controls the data and the IP – and whether the people who create it are respected or exploited. 

Concept image of a 2025 painted on a road headed for a sunrise as a concept image for 2025 media trends
Advertising | AI | Featured Post | Innovation | Perspectives | Policy

The big 5 for 2025: forces impacting media and tech

As we barrel into the new year and all that awaits, the media industry is at the nexus of technological disruption, regulatory upheaval, and changing consumer sentiment in terms of media and expectations for it. From the rise of artificial intelligence to intensifying antitrust enforcement and the shifting stance of dominant platforms, the stakes for publishers and content companies have never been higher.  

Here’s a look at five critical trends in the media landscape and what they may mean in the future. 

Artificial intelligence is reshaping content creation and distribution with breakneck speed. AI-generated search results are increasingly the norm, while the fate of the underlying articles and video remains murky. Publishers are leveraging AI to scale production, personalize experiences, and streamline workflow. However, while this boom propels media forward, the underlying AI models are contentious in their devaluation – or outright dismissal of – property rights, IP, and the fair value of content, not to mention debate around the quality and accuracy of AI generated search results and source attribution.  

In 2025, marquee copyright cases are slated for trial. Courts will tackle questions about how intellectual property laws apply to works created or transformed by AI rather than humans. At stake are the legality of using copyrighted material to train AI models and the extent to which those models can monetize their output while risking, if not entirely supplanting, the clear licensing opportunity for publishers. These rulings will set precedents and could rewrite the rules of the road for both AI developers and publishers. 

Joining the groundswell, Canadian media orgs jumped in last week by collectively suing OpenAI, alleging unauthorized use of their news reporting to train its models. Similar lawsuits are expected to continue globally as publishers push for enforcement against misappropriation and/or copyright violations of their work. 

Media companies must once again prepare for these shifts by walking and chewing gum at the same time. As ever, publishers must safeguard their media content while continuously experimenting. The challenge will be striking the balance between embracing AI’s potential and ensuring accountability with their strategic technical platform partners. 

2. The role of a free and plural press amid political threats 

In this era of heightened political tensions, the role of the press as a democratic watchdog is paramount. In the U.S., the new administration brings with it a wave of uncertainty.  Media leaders watch with a wary eye as leadership nominations roll in.   

Concerns about surveillance, legal pressures and expense, and erosion of journalistic protections here and around the world are intensifying (to say the least). Globally, authoritarian regimes are leaning on tech to suppress dissent and control narratives, challenging the resilience of independent media.  

For publishers, protecting and promoting a pluralistic media ecosystem is essential. This means investing in news reporting, supporting press freedom initiatives, and maintaining commitments to accuracy and integrity despite political pressures. As threats to press freedom grow, a robust fourth estate remains critical to the industry’s long-term viability as well as to democracy itself.  

3. Social platforms: shifting sands in distribution 

Social media’s dominance in content distribution is being reshaped by user migration. Elon Musk’s tumultuous leadership of X (formerly Twitter) has alienated advertisers and much of its user base, notably journalists. This has fueled the rapid rise of Bluesky, a decentralized alternative designed to resist the power of billionaires and governments. Remarkably, Bluesky is approaching or has surpassed Meta’s Threads in certain usage metrics. Bluesky’s embrace of open-web principles and support for journalism –  very different from the current suppression of links on X and Threads – has further endeared it to journalists and publishers. 

These platform shifts come amid the FTC v. Meta antitrust trial, scheduled for April 2025. Although the legal complaint focuses on the relevant market of social media built around the personal social graph (thereby excluding X, Bluesky, Threads, and LinkedIn), the dynamics of platform competition remain crucial for publishers to connect with new audiences where they want to be reached. It is also as yet unclear how the incoming Trump administration will respond to a potential ban of TikTok, which is set to hit a key milestone the day before his inauguration. 

For media companies, platform diversification has long been a requirement. Relying too heavily on any one distribution channel leaves brands vulnerable to algorithm changes, shifting user sentiment, and unpredictable policy shifts. Building owned-and-operated platforms, prioritizing direct relationships with audiences, and leveraging multiple distribution channels are essential strategies to ensure resilience in this fragmented ecosystem. 

4. Regulatory and court interventions reshape big tech 

2025 is shaping up to be a watershed year for antitrust regulation and enforcement. The U.S. Department of Justice (DOJ) has already won its search antitrust case, calling for the divestiture of Google’s Chrome browser and potentially its Android operating system. Meanwhile, the DOJ’s Virginia adtech case (expected to result in another major win) foreshadows broader changes to Google’s dominance in digital advertising. Next up: the Texas adtech trial in March, followed by the previously mentioned FTC antitrust case against Meta. 

Beyond the U.S., Canada’s competition regulator called for the breakup of Google’s adtech business last week, with the European Union likely to follow suit. These developments could significantly reshape the global ad market, which would offer publishers an opportunity to regain control over their data and revenue streams.  

However, it also introduces uncertainty. Navigating new partnerships, technologies, and regulatory frameworks will require adaptability and leaning into a long-term strategy while bearing short-term headaches (read: costs). Building strong first-party data capabilities and exploring alternative adtech solutions will be crucial for growth in this evolving environment. 

5. Advertising reinvented: privacy, AI, and accountability 

Advertising is undergoing a transformation driven by consumer privacy concerns and regulation. The death of third-party cookies and the rise of privacy-focused technologies have elevated the importance of first-party data. This means that publishers’ direct relationships with audiences and the high-quality content they provide are more valuable than ever. 

Google’s antitrust challenges are also poised to reshape the future of advertising. The cases brought against the company globally allege manipulation of ad auctions and abuse of its monopoly power to harm publishers and consumers alike. If successful, these actions could reinvigorate competition and enable publishers to negotiate better terms, which would have been available for the past 10 years if it weren’t for Google’s  behaviors. The greatest fruit of Google’s abuses across search and adtech may well be YouTube where Google has been able to marry its unparalleled access to search, location, web-wide browsing, and adtech data with the largest pool of streaming video inventory on earth. It will be interesting to see if this attracts regulatory scrutiny in 2025. 

At the same time, AI is accelerating the evolution of advertising strategies. Predictive targeting, on the fly ad creative, and more advanced tech to control ad campaigns are helping large platforms capture new dollars from offline retail media while better maintaining privacy. For publishers, a dual focus on consumer trust and innovative monetization will be critical for success if they want to peel off some of these dollars. 

Outlook: shaping the future of media 

In 2025, the media industry is defined by rapid change and high stakes. From AI-driven innovation and platform fragmentation to regulatory challenges and shifting consumer expectations, content companies face a complex and evolving landscape. Success will require a commitment to trust, adaptability, and creativity. 

As DCN has long advocated, publishers prepared for these shifts – whether through diversifying revenue streams, strengthening first-party data, or doubling down on audience relationships – will be well-positioned to survive if not thrive. In this new era of accountability and competition, it’s not just about outlasting disruption; it’s about shaping what comes next. 

Featured Post | Policy

5 insights during the intermission between US v Google I and II 

As we approach opening arguments of Google’s landmark AdTech trial on September 9th, it is a good time to reflect on the calendar of events leading to this moment. It is useful to consider the context and critical points at play in the case against Google, particularly given last week’s search antitrust verdict.  

To recap, here is the timeline to date of the four major lawsuits alleging Google engaged in monopolistic behavior:  

  • Dec 11, 2023 | A federal jury found that Google’s app store violated antitrust law  
  • Aug 14, 2024 | Closing arguments on remedies for Google’s app store antitrust violations 
  • Sep 6th, 2024 | Judge Mehta will begin the trial on remedies to Google’s search monopoly 
  • Sept 9th, 2024 Trial begins AdTech antitrust lawsuit brought by DOJ (see more info below) 
  • March 25, 2025 | Google faces Texas court in a second AdTech antitrust lawsuit brought by state attorneys general 

And here is a significant resource for those who seek a fuller picture of the upcoming Google AdTech antitrust trial: 

So, as we look toward the start of the next phase in the antitrust actions against Google, here are five key considerations for media executives, journalists covering these cases, and for the general public—as this company’s anticompetitive behavior impacts almost every person online.   

1. Ending Google’s innocence narratives: The abusive monopoly is confirmed  

The first significant outcome of the search case is the formal acknowledgment of Google’s monopolistic status. It’s no longer a matter of debate whether Google is a monopoly. Given that the court has ruled definitively on this point, I have no idea why The Information is sending out polls asking its subscribers if Google is a monopoly. This is no longer a subject of debate.  

A unanimous jury of Northern Californians last December, and now a D.C. district court judge last week, have decisively found that Google monopolizes four critical markets: general search services, search text ads, Android app distribution, and Android in-app billing. More importantly, the verdicts also found that Google engaged in anticompetitive conduct to maintain these monopolies. The wider Search verdict—a fabulous read—effectively ends any narrative of Google’s innocence and sets the stage for a broader reckoning within the tech industry.  

2. Illuminating Google’s tactics: The truth shines through  

The trial last Fall exposed the extent of Google’s market power and its aggressive, if not illegal, tactics. Under oath, former Google employees (often referred to as “Xooglers”), partners, and even current employees provided testimony that has shed light on the company’s practices.  

Discovery in these cases has revealed much about Google’s internal operations, with documents and testimony uncovering the strategies Google used to maintain its dominance to maximize its benefits. These revelations are crucial not only for the legal proceedings but also for broader public understanding of how big tech companies operate behind closed doors.  

3. A matter of public interest: The stakes for media and society  

The implications of these cases extend far beyond Google’s corporate interests. Google is not just a search company. It is not just a tech giant. Google is the single largest distributor of news and entertainment—as well as the advertising dollars that sustain these industries. With annual revenues nearing $300 billion, the company’s influence over the media landscape is immense.  

Taken together—Google AdTech case, along with the Search verdict—arguably mark the most significant antitrust action affecting the media industry in a half-century. The outcome will have profound implications for how information and advertising are distributed in the digital age. Yet, despite the critical nature of this case, there has been a surprising lack of press coverage and public awareness about the evidence presented.  

Let me try to illustrate not only why the AdTech trial matters, but why it is a story the public needs to hear: 

  • What if I told you the heads of Chrome, Android, and AdTech divisions collaborated via email to maximize ad revenues to hit their quarterly targets?  
  • What if I told you Google’s advertising auctions weren’t always second-price auctions, but that publishers were at times secretly paid the third price while Google pocketed the difference?   
  • And what if the auction bids included another arbitrary, secretive variable determined unilaterally by Google?  
  • What if I told you Google exerted its outsized influence on the very shape of the media ecosystem based on the position that subscription news sites were a threat to the open web?  
  • What if I told you Google’s notorious “Jedi Blue” deal with Facebook is still a part of the evidence in this case and that the key Meta employee who briefed Mark Zuckerberg ahead of his meeting with Sundar Pichai will be testifying this September? 

These cases impact almost every searcher’s ability to access news, entertainment and information. If those stakes aren’t high enough, the cast of players and the Machiavellian twists make for compelling storytelling. The public needs to know.  

4. Converging lawsuits: A unified attack on anticompetitive practices  

The lawsuits against Google, though focusing on different aspects of the company’s operations— app store, search and AdTech—share common themes. Judges have noted that Google allowed employee messages to be purged by default, despite ongoing litigation holds, and manipulated auctions to impact revenues. These findings indicate a pattern of behavior that transcends individual cases. It points to a systematic approach to maintaining its monopoly power.  

The convergence of these lawsuits highlights the interconnected nature of Google’s business practices and the data and queries at scale serving as the core of its business model. It’s becoming increasingly clear that any meaningful remedy must address the chokepoints of Google’s operations that feed the data and query scale. Doing so should also open opportunities for new entrants in the emerging field of generative AI. 

5. Remedies on the horizon: structural changes loom large  

The future of the media industry will be on display in federal court rooms on both sides of the Potomac next month. As the separate remedies trial for the search case gets underway in the DC district court and the AdTech trial starts in the Eastern District of Virginia (Alexandria), discussions about potential remedies have begun to surface.  

While short-term solutions, such as prohibiting Google’s commercial deals to serve as the default search engine on browsers and operating systems, are being considered, it’s evident that more substantial structural remedies will be necessary. The prosecuting teams, under the leadership of Assistant Attorney General Jonathan Kanter, seem to understand the intricacies of Google’s business model just as well as industry insiders. Without structural changes—such as breaking up Google’s control over key gatekeeping assets like Chrome, Android, YouTube, and its AdTech supply chain and data. it will be impossible to mitigate Google’s monopolistic practices in the long term.   

The idea of “Baby Googles,” or the division of Google into smaller, independent entities, is not just a hypothetical scenario; it’s a very real possibility that could reshape the tech and media industry.  

The future of Big Tech and the free market  

The second verdict against Google marks a turning point in the battle against monopolistic practices in the tech industry. The outcomes of these legal battles will not only impact Google but will also set precedents for how other tech giants like Apple, Amazon, and Meta—all currently being sued by either the Department of Justice or Federal Trade Commission or both—are regulated in the future.  

But it is important to remember that this isn’t just about setting the tone for Big Tech regulation. It is about the underlying motivation behind these cases; the very reason America has antitrust laws in place and a framework to enforce them. As DOJ antitrust chief Kanter framed it in an interview on CNBC, actions like these are particularly critical during times of technological change. As AI is poised to reshape search—and impact industries of all kinds—ensuring that the marketplace is a healthy one, where competition and innovation flourish, takes on paramount importance.  

“As we sit here at the next technological inflection point,” Kanter said, “it’s extremely important that we protect the competitive process to make sure that the benefits of technological innovation, the excitement that we’re all feeling from AI… can reach consumers in a fully competitive way.” 

It looks like the era of unchecked dominance by a few tech behemoths may be coming to an end, with far-reaching consequences for the entire digital economy.  

Featured Post | Policy

Google, what big teeth you have  

Google has issues. Lots of them. Unfortunately for our industry, Google’s issues are our issues too.  

Last week, I observed a strange turn of events when an eye-opening HouseFresh blog post titled, “How Google is killing independent sites like ours” quickly evolved into a bizarre critique on the quality of work by and trust for premium publishers. While that may be a subject of debate, one thing we know for sure is that Google’s search experience often puts profits ahead of surfacing quality information—from small sites, independents, or anyone else that isn’t delivering dollars to its bottom line.   

Mind you, this conversation was happening in the very same week in which Google’s outsized role in shaping public perception was on display as their newest product was found to be generating racially diverse Nazis. (Yes, you read that right). Was Google trying to rewrite history? Or just further demonstrating that its product and profit priorities can quickly get dangerously ahead of its historically unique and dominant role in determining how information and value gets distributed to the world.  

Anti-trust me 

Meanwhile, a little-known collective comprised of the United States Department of Justice and nearly every state attorney general was filing its closing briefing for its antitrust trial against – you guessed it – Google. Suffice it to say that this monumental case didn’t get nearly the column inches it deserved despite damning evidence. There’s something almost poignant about an industry undermined by Google for decades lacking the resources, or public interest, to cover a case that rivals other once-in-a-century trials on par with standard oil (likely surpassing AT&T and Microsoft) in its impact on the free market and competition.  

For those new to these details, I would summarize the United States case against Google in three floors of an elevator pitch:  

  1. Google has monopoly power in general search services and the advertising that comes with it.  
  1. Google has systematically captured more than half of this market by paying roughly $30 billion per year for exclusivity on devices (Apple and Samsung) and browsers (e.g. Firefox and Safari). I left out the most popular operating system and browser, Android and Chrome, as Google gets them for free because it owns them. 
  1. The result of this monopoly power is 95% market share on mobile and orders of magnitude advantage in data (aka “signals”) allowing Google to maintain its market dominance through superior data for ranking, local queries, and new queries, along with the all-important ads. And finally substantial advantages in emerging markets like artificial intelligence.  

A case of convoluted logic 

What does Google say about this in its own defense? Well, each of their claims sound weak to those of us who have been around the block a few times in the digital media world. I’ll lay them out here with my own redirect: 

  1. Google spends its first 15 pages arguing it competes in search with Amazon, TikTok, Facebook, Yelp and the list goes on. Have you ever searched Amazon for a local restaurant? Have you ever searched Facebook for a new television? Have you ever searched Yelp for a BBC report? This attempt to throw out the entire definition of general search is a waste of ink. (But, hey: maybe they used Gemini to formulate it.)  
  1. The next chapter from Google is an argument that, even if they accept the market of “general search,” they still don’t have monopoly power in it. To the contrary, a good deal of internal evidence demonstrates Google’s ability to raise prices, lower privacy and weaken consumer experience without missing a beat. An experience utterly degraded, particularly on mobile where it is clearly pay to play and self-preferencing of Google’s own products.  
  1. Finally, Google would like you to believe that all its deals with devices and browsers are not ‘exclusive’ as they merely make Google the default search engine. This may be left to the Court on semantics. But again there are, in evidence, internal decks from Google regarding the power of defaults that explain their significance to maintaining market share along with a damning letter sent to Microsoft claiming it would “deprive consumers of a competitive choice in search” by making Microsoft the default search. That litigation threat was sent by – surprise  – Google. 

Google is not your friend 

I now return to my central point: Google puts the enemy in frenemy. No doubt they are the most significant business partner for nearly every publisher on the planet. They often send the largest monthly revenue checks from their near ubiquitous role in distribution and monetization of the web.  

But as it relates to how they shape its design, the tools we use, the incentives it proffers, and how the welfare gets divided, they are certainly not the friend of media. Nor are they a friend to consumers who seek out quality information and would benefit from an open competitive marketplace.  

Next up, we’ll see the UK Competition and Markets authority flex as it has closely examined Google’s plan for third-party cookie deprecation. The CMA insightfully notes that maybe the solution isn’t further delaying Google’s cookie deprecation – consumers don’t want to be tracked and surveilled – but instead putting limitations on Google’s abuses. A M E N.  

Stateside, Google next faces the US Department of Justice in an adtech lawsuit set to go to trial on September 9th, 2024. The exhibits, depositions and evidence in this case will shine a light on every aspect of how our modern media economy is designed, distributed and dominated by a company that just surpassed $300 billion in revenues. To give that number some relative scale: Google earns the annual revenue of the largest news organizations (be it CNN, The New York Times, FOX News) in the world in just three days. 

Google’s money-making results 

Of course, none of this is to suggest that media endeavors aren’t in the business of making money, if only to support the work of journalists as in the case of non-profit models. Yet again, this week, we learn that Google is reportedly paying “smaller publishers” to use its AI tools. As with other Google News Initiative projects, this one is cloaked in the veneer of helpful benefactor here to support the creation of news. 

Putting the relatively small sums involved aside, publishers are wise to remember that Google is not a friend. There is little doubt that this scheme is intended to benefit Google far more than any of the publishers involved. We may not see it yet, but if the evidence coming to light in the current spate of antitrust trials suggests anything, it is that we can look forward to the revelation of internal documents demonstrating the self (ish) motivation driving this organization.  

Even as we explore the discussion around HouseFresh’s revelations about the questionable quality around the search results for product reviews we can’t forget that the root cause is Google’s profit-first approach. The engine that drives our traffic was really only built to drive revenue for one company. Results that favor commerce favor Google.  

So, as the media allocates resources for courtroom coverage, let’s not forget how high the stakes are here. This goes far beyond the health of the media industry, or the chilling effects of monopolistic power on innovation. Ultimately, it is the marketplace of ideas, the value exchange of information, and the ability to surface essential news and entertainment that suffer in a system so profoundly gamed by one player. 

AI | Featured Post | Perspectives | Policy

Five plain truths about AI 

“The rise of AI is an existential threat for media companies.”  

“The rise of AI is a disruptive opportunity for media companies greater than the Internet itself.”  

I overheard both statements in the last week. How can both be true at the same time? 

While I may not be able to square that circle, I do know that DCN has spent the last decade focused on the future and not shying away from difficult questions like these. And, for the past six months or more, we have been among those immersed in the impending upheaval and unprecedented opportunity heralded by everyone from AI doomsayers to evangelists. 

While the questions about the future of AI in the media are far from answered, there are a few plainly obvious truths emerging as we explore the full potential of AI.

  1. The Large Language Model (LLM) data sets on which generative AI is being trained have been built upon what may well be the most extensive violation of copyright in history. The power and promise of AI to reshape industries is rooted in intellectual property that is a necessary ingredient in the equation. That bad math, that bad faith, must be recalculated and recalibrated in order for AI to evolve in a way that aligns with the true spirit of this extraordinary innovation.
  2. Many challenges of the last decade remain constant in the AI era. Market power and abuse is a profound problem. It would be naive to rely on the generosity of trillion-dollar companies to silo negotiations to train tech companies’ large language models from the impact and the needs of the whole of the media business.

    Consider the way in which Google has historically argued that it doesn’t detract from media sites’ revenue because it drives traffic to them. On the contrary, it is well understood that “search results” have become overwhelmed with advertising and offer “snippets” (scraped and trained by publishers’ sites) that often satisfy the user without having to click through. Generative AI takes this so much further, by allowing the search engine to compile information from a multitude of sites—without necessarily crediting any of them, much less driving traffic.
  3. Privacy concerns around LLMs need more attention. Somehow the excitement and ready access to real-time output has swept this under the rug. Recent history should have taught us better. 

    Clearview AI, infamous for scraping billions of images across the internet without consent to fuel facial recognition, is the subject of a new book, Your Face Belongs to Us. And we learned in unsealed court docs earlier this year that Facebook used data brokers to train its machines to microtarget ads when they were forced to stop buying data outright. LLMs create a deep new well of data that is being opaquely collected and that will inevitably be exploited in ways consumers would not expect—or approve of.
  4. Generative AI will increasingly be used for storytelling, whether in the fields of news or entertainment. However, responsible and successful media organizations recognize its limitations and human hands will still shape the creative output of these tools. As long as this storytelling involves humans at any point in the creative process, this content will require protection under the law. Otherwise, the devaluation of creativity and truth will be inevitable. 
  5. The sustainability of the free press is an essential ingredient for democracy. A free press supports an informed public, which holds the powerful accountable. Healthy competition and capitalism have unlocked opportunities and efficiencies that media companies have benefited from, and there’s no reason to believe that the AI era will be different. However, given the unhealthy dominance of the big technology companies, the last decade has been perilous for the press.

    Therefore, any conversation around the future of AI must be anchored on the needs of an informed public, which starts and ends with an ecosystem that supports professional local and national newsrooms.

Given what we have witnessed over the past decade in the proliferation of mis- and disinformation, which has leveraged technology and vacuums in trust, the generative power of AI must give us pause. With power comes responsibility, and these are tools that we must use, and govern, wisely.

As someone who is listening, reading and thinking about what’s next as a full-time job, the acceleration of AI and its impact on media has got me on the edge of my seat. I’ve witnessed firsthand what media organizations have accomplished with AI for decades, and eagerly anticipate continued innovation. I also respect and acknowledge the efforts of media organizations to defend their work product, their creative output, the reporting, writing, photography, cinematography… as so much more than a mere data set. 

We know our work. We know our worth. And we know our audiences and respect their values, which is why they value us. While the questions and innovations will keep on coming, there are unequivocal truths that should guide us as we continue to build a strong media ecosystem.

Advertising | Featured Post | Perspectives

Will tech’s “signal loss” be our opportunity?

In media, “signals” have long driven the business, whether for must-see entertainment or brand-defining journalism. Unfortunately, these signals, which convey value, meaning and relevance, are becoming harder to distinguish amidst the increasing noise of modern digital media. Yet the ability to distinguish between signal and noise is just as important, if not more so, in the age of digital media given the abundance—and velocity—of information.

Today, there are fewer and fewer high-value signals that can cut through the noise without interference. Brands invest upwards of seven million dollars for a 30-second commercial during the Super Bowl or six figures to run a page in the September issue of Vogue so that they can send a signal to a large and focused audience, not only about their product, but also make a statement about the significance of their market position. In other words, “we have so much confidence in our offering that we can spend this kind of money to tell you about it.” There is very little noise surrounding these types of advertisements. The message is clear. And everyone makes bank.

However, there are also high-value signals that must compete with endless noise. To see this in action, just take a stroll through Times Square in New York City, one of the busiest and noisiest places in the world, with a constant barrage of sights and sounds competing for attention. Amidst all this noise and the tens of thousands of people rushing about their days, one might think it would be challenging for any brand to resonate. Yet countless companies do just that by spending millions to share their message in this hub of entertainment and commerce. With their brand messages broadcast on LED screens hundreds of feet wide, or plastered on buildings that stretch to the sky, they send an unambiguous signal of value and importance.

The Super Bowl offers one of the year’s must-watch experiences—both on the field and in the ad breaks. The pages of September Vogue overflow with lush photos and unparalleled fashion coverage with ads deftly woven into the fabric. Times Square is one of the most exciting, chaotic, and sense-stimulating places on earth. In every case, the context provides a signal boost: What you see here has value.

In the world of digital media, the rise of the tech giants has allowed them to suppress signals and amplify noise. Amidst the endless content scroll are interchangeable commodities and it’s hard to differentiate between much of anything on these platforms. In many ways, they’ve turned the world upside down by turning traditional signals into something else altogether through their black-box algorithms.

Often these secret signals happen below the surface shrouded in mystery, as seen in the case of the Google search engine. This tool was built in a revolutionary way, using “signals” to sort all the world’s information. This grand innovation offered a way to create structure by ranking a site’s ability to collate high value links around the web. Fortunes have been won and lost in how Google values those signals. Over time, Google matured and evolved into using authority and other proxies to value sites across search and YouTube. The signals favored by this search superpower frequently recalibrate, but we know they are there under the surface, controlling what people see.  

Amazon has built the world’s largest retail store where its Prime signal, in a classic flex of monopoly power, has arguably become the most important indicator of whether the customer will buy a product or not. Sure, there may be dozens of vendors offering nearly identical products, but a single signal undeniably tilts the scale.

However, we have also seen that signals can be “lost.” Facebook built what is arguably the most powerful targeted advertising business in history by mining and exploiting data across the web and mobile app ecosystem. Targeted ads have consistently comprised more than 97% of the company’s revenues for more than a decade. This was never clearer than in 2021: When Apple stepped up its privacy efforts, Facebook lost nearly half of its market value, which the company’s CFO attributed to “signal loss.” That loss continues to haunt the company’s fortunes as the company scrambles for a new moat to protect its empire. 

The value of signals amidst the noise is also key to the rapid-fire (and controversial) development of large language models, such as those used by Google’s Bard and Microsoft’s Bing to train generative AI. The value of an answer engine will undoubtedly lie in the quality of its results. Therefore, such models must differentiate between things learned through Financial Times versus Reddit, Washington Post versus Twitter, and so on. Although they may claim to treat all domains generically, there is little doubt the source matters. All content is not equal.

As digital technology continues to advance, distinguishing between signals and noise becomes ever more challenging. Like Times Square, the noisiness of the digital world can be stimulating and provocative. However, with so much noise, signals that can convey meaning and relevance to a broad audience have more value than ever.

Media companies must focus on developing strategies that allow them to differentiate themselves and their messaging, so they can send signals that cut through the noise and resonate with their target audience.  And they must seek out platforms, partners, and technology companies that fully recognize and fairly compensate these valuable signals as they launch, thrive, and grow into maturity.

Amidst the nearly infinite access to content created by anyone and everyone—from influencer-ally or trusted brand to bot armies and monetizers of disinformation, signal has never been more valuable. Ultimately, the ability to differentiate between signals and noise is essential to success in the digital age, and those who can do so effectively will have a significant advantage, and that advantage will be one shared by the audiences they serve.

AI | Featured Post | Innovation | Perspectives

Spilled ink: How to prevent AI from vacuuming up your business model

The many profound possibilities for creators leveraging artificial intelligence have been quietly heating up over the last decade. So, what really changed in the past few months? Certainly, the clever roll-out of ChatGPT only months after DALL-E 2 has thrown gas on the burner. Right now, press coverage and industry chatter are mostly focused on uncovering real-world applications offered by generative AI, which are exciting to be sure. However, wise publishers will heed lessons learned from past experiences in which their data were scraped and take an active role in preserving their business value.

“Scraping the web” is a term as old as the web itself. It’s no secret that Google’s core business was built by crawling companies’ servers to train its search engine to find and deliver satisfying results across the vast world wide web with speed and precision. The result: Google now plays the role of gatekeeper for much of the web.

The reality is that any publisher who made the radical decision not to allow Google’s crawler to do its thing would quickly become almost impossible to find online. Giving Google the free right to crawl your site is the cost of business to exist on the open web today.

Just last week Google began testing blocking news properties in Canada. As Campbell Clark wrote for the Globe and Mail earlier this week, “It’s not a threat, of course. Sometimes people just wake up with a horse’s head in their bed.”

This is yet another stark example of Google’s power. No individual publisher has the bargaining power to opt out and impact Google’s business. So no one does.

It’s not actually that different from the way in which Facebook built its social media platform into a digital advertising juggernaut. After many years scraping and collecting user data across the web and its partners – from far beyond the walls of its garden – Facebook began using AI to leverage its massive data warehouse appropriately named “The Hive” in a manner that is irreversible. Publishers are only now learning how all of this data was used, and abused,  through lawsuit discovery and leaked documents.

Importantly, as was uncovered through one of these leaked documents, Facebook engineers used the metaphor of ink spilled into a lake to describe what happens to a person’s data once it makes its way into the Facebook’s data warehouse:

“We’ve built systems with open borders. The result of these open systems and open culture is well described with an analogy:

Imagine you hold a bottle of ink in your hand. This bottle of ink is a mixture of all kinds of user data (3PD, 1PD, SCD, Europe, etc.) You pour that ink into a lake of water (our open data systems; our open culture) … and it flows … everywhere. How do you put that ink back in the bottle? How do you organize it again, such that it only flows to the allowed places in the lake?”

This brings us to generative AI – 2023’s hot topic. It’s unequivocal that the Large Language Models are being trained by ingesting the work of newsrooms across the web. To better understand this fact, consider that Google disclosed that a whopping 15% of Google’s daily searches are completely new searches.

Now think about that for a moment: The most likely trigger for a novel search is an unfolding news event. That means the simple fact that these searches occur was triggered by the work of news media. And, as we know, Google monetizes answers. Particularly when confronted by a new query, Google’s machine learning algorithms lean into authority brands – those deemed likely to provide a trustworthy response. Guess who those are? You can see by looking at the top results presented by a search around breaking news: the results are called “top stories” and you guessed it: they come from media brands.

No one should doubt that a similar level of interest, intelligence, and impact on generative AI will be instigated—and answered—because of the work product of the news media, particularly given the role of Large Language Models in their training and operation.

So, if the output of newsrooms, writers, artists, and media companies were not available to scrape, what would happen to the quality of 2023’s much-hyped generative AI?

Copious effort and investment go into the creation of premium content. The use of premium content to train AI models is akin to fueling your machine with gasoline you “found” in someone else’s garage. It doesn’t inherently mean that the machine is not powerful, or useful. But that fuel was not free to create. If your machine can’t run without it, something is not quite right with the system.

Given Facebook’s metaphor, the publishing world may need to serve notice to OpenAI and its ilk before they can make the claim that the ink flow can no longer be reverse engineered. Let’s hope it is not already too late.

In November, DeviantArt rolled out an HTML tag so that an artist can inform web robots not to crawl their images to train art-generating AI. Media companies need to consider whether the right course of action is to launch a similar tag, which tells bots not to crawl and train their AI with publishers’ work. Of course, like many technical issues on the open web, this would only rein in the good robots and would not solve for bad bots.

But it is important that we make a start, before too much ink has spilled.

Featured Post | Policy

The cracks in Google’s adtech façade are starting to show

Behind the scenes, Google is flailing – despite its predictably tight control over industry narratives. 

The underlying shockwaves stem from an increasingly widespread understanding of Google’s dominant role over the entire adtech supply chain. Those who have sought to unpack and explain the complexities of the company’s hold on the industry can thank a senior Google employee for providing this apt analogy in discovery: They described Google’s role in adtech as “if Goldman or Citibank owned the New York Stock Exchange.” Now that’s something a jurist can understand. 

The escalation of enforcement 

In the last sixty days, Google has floated three different test balloons in an attempt to head off the intensifying scrutiny: 

  1. The Wall Street Journal reported Google has offered to split off part of its adtech business in an effort to head off the Department of Justice’s filing of a landmark lawsuit – expected this month according to a Bloomberg report. The only problem: Google’s offer was to split the adtech business and put it under a different part of parent Alphabet. To extend the previous analogy, placing the NYSE in a different division of Goldman Sachs would not solve the inherent issue. Hard pass.  
     
  2. Google announced a new feature with the innocuous title of “Confirming Gross Revenue.” They’ve pitched it to advertisers and publishers – and little doubt to enforcers, too – as providing transparency in a “privacy-safe way” as to the money flow in the advertising supply chain. The problem with it is that Google will avoid having to provide insights into auctions, transactional flow, or any real detail as to how Google’s decisions determine revenues across the market. Google’s press announcement crows that “Display & Video 360 is onboard as an early tester.” That sort of says it all, since Google owns DV360.  
     
  3. Google once again delayed its deprecation of third-party cookies, something that they’ve been dragging their feet on for nearly three years. From the very beginning, Google has used misleading Google-authored research of the Google-dominated supply and data system to suggest their delays are only due to their interests in not harming publishers. What is true is that a wrong move by Google (hello Floc, hello Topics) can very well continue the ongoing harm to premium publishers by treating every website as an interchangeable commodity. If there’s any chance that a move will hurt Google’s ad business, it won’t happen. 

Litigation, legislation, and learning 

So why all the flailing? To illuminate what’s going on underneath the surface, let’s take a roll call. Fifteen U.S. states, the U.S. Department of Justice, the E.U. Competition Commission, the U.K. Competition and Markets Authority … Netherlands … France … well, suffice it to say that the list is long (and growing) for investigations, lawsuits, and enforcement action underway – all of which are probing Google’s advertising tech business(es).  

The E.U. has been particularly active by fining Google more than $8 billion across three decisions. It also recently passed its new landmark gatekeeper law, the Digital Markets Act, and is ramping up enforcement of its landmark privacy law, the GDPR, by pressing Google-friendly Irish regulators. 

Importantly, enforcers and litigators are studying and learning from each other across issues of competition and data privacy worldwide. And they’re keeping especially close eyes on the Texas-led lawsuit which now counts 15 bipartisan state attorneys general as plaintiffs along with countless private plaintiffs. They certainly won’t have overlooked Google losing much of its arguments last week in attempting to dismiss this case. This blow came at the hands of a SDNY Court which very much seems to understand Google’s business. And that’s a huge problem for Google. 

Full court press 

Although “Jedi Blue” received the most press attention, due to the allegations of Google colluding with Facebook, there are a range of other very serious allegations which the Court has now given the green light for further discovery and trial. And, significantly, they are readily explainable to a jury. Two foremost allegations are the tying of Google’s adtech services and the manipulation of its auctions.  

What if I told you Google required the use of its ad server in order to receive the benefits of Google’s market-leading ad exchange and the fast-growing advertising demand dollars flowing through it?  Some might call this “tying,” which – if proven – is illegal.  Note that Google had about 50% of the ad server market when it acquired DoubleClick (DFP). It has since steadily increased that stake to claim nearly 99% of large publishers. Please allow me to quote the Court:  

 “The States plausibly allege that Google used its monopoly power in AdX to actually coerce publishers into licensing a separate and distinct product, Google’s DFP ad server, and that Google’s actions had anticompetitive effects in both markets, affecting a substantial amount of interstate commerce.” 

Or what if I told you Google had paid its publisher clients based on the third-highest price in an auction while collecting on the second-highest price with the determination it would re-route the variance into more advertising demand for its own services?  Some might call this, “market manipulation,” which – if proven – may well have been an illegal way to protect its monopoly. As the Court again summarized Google’s project “Bell”:  

“In other words, Bell penalized publishers who did not grant AdX preferential access by paying them based upon the third-place bid rather than a second-place bid, while using the difference to increase the bids made to publishers who allowed preferential access.” 

In fact, the only count which was dismissed in the lawsuit is the infamous “Jedi Blue” allegation. Despite Google anchoring its press spin on this win, it’s this single dismissal – one that befuddled many legal experts watching the case. I wager this one will resurface again as the E.U. and U.K. have already announced their own investigations. Also, the “Jedi Blue” allegations are included in a private lawsuit against Facebook that has already been given the green light in the northern district of California. Each of these efforts builds on the others and the subsequent learnings can only aid the U.S. Department of Justice in its work.  

Antitrust is in the air 

It was rightly said nearly three years ago that antitrust enforcement will take significant time. The wheels of justice do indeed turn slowly. Attempting to propose solutions before the investigations and allegations landed would be premature, but Google’s efforts to settle these cases shows they are nervous. And Google’s efforts to manipulate the outcome may be the most transparent thing about its business.  

The reality is many of the charges against Google have now been found plausible and will proceed into deeper discovery just as many other regulators and legislatures attempt to curb its power. Make no mistake, Google is stumbling in a way we’ve never seen in its two decades. Of course, the company will look to proactively lay out solutions for all of us. But we all see through this. No one should settle for anything less than a return to competition and the rebalancing of bargaining power that comes with it. 

Featured Post | Perspectives

Stay the course

Netflix’s earnings report last week sent a chill across nearly every company with a business model tied to a direct-to-consumer relationship. There are real concerns about the global economy and speculation about whether the  massive increase in streaming viewing habits seen during the pandemic will prove to be enduring. However, I wonder whether the insights gleaned from the Netflix situation are unique to Netflix and not a strong indicator for other media companies, most of which are just starting their streaming ventures.

First, let’s acknowledge the macroeconomy. Inflation registering over 8% will impact nearly every consumer market; this is especially true if inflation leads to higher interest rates and the dreaded “R” word. Unfortunately, this will be an ever-intensifying concern.

There has been a great awakening around the globe after two years of Covid, during which we had requirements and excuses to stay home and avoid socializing. There were countless stories in the trade and mainstream press as we witnessed streaming viewership’s outsized growth about isolation’s impact on our insatiable appetite for entertainment – escape. And binge-watching – which was already a trend after Netflix tossed a hand grenade into the linear schedule – only escalated during this period.

Certainly, Netflix finds itself with real competition for digital share of wallet for the first time in its history. Storied media companies have rolled out exclusive offerings that feature everything from hit television programs to blockbuster movie franchises: Batman, Star Trek, Yellowstone, Avengers from HBO Max, Paramount+, Peacock, Disney+, respectively. Many have regained rights to classic television hits that are endlessly bingeworthy.  Meanwhile, Netflix has increased its price, nearly doubling its monthly cost ($15.49 from $7.99 when it first launched) while cracking down on password-sharing as it, impressively, has saturated the market.

But while Netflix may have led the way in streaming, it may not be the best proxy for the subscription market opportunity. The company faces its own issues with stagnating growth and should not be mistaken for marketplace indicators. 

What is really happening

DCN’s 2021 research into the value of direct, trusted consumer relationships, brands as proxies for this trust, the needs and behaviors of Gen Z vs Gen Y, and the subscription market point to this lesson: Ignore Netflix and stay the course.

Most important are the lessons coming from studying the “next” generation. Consumer behavior is radically different in a world where payment and immediate gratification are merely a double tap of the thumb and face scan away on a mobile device. Paying for access to your favorite news or entertainment product, whether podcast, app or website, is no longer a foreign concept after hitting a “paywall.” Rather, it is little more than a friendly nudge along the way associating value with the products you love.

The number of people willing to pay for access to news and entertainment is increasing. In fact, Netflix’s greatest legacy for the market as a whole may have been leading the horse to the water. Netflix also worked with premium providers and helped build an appetite for great content and normalized paying for it.

What publishers seek

Now, distribution platforms from Apple to Google to Facebook are being pushed to finally act as true partners in driving subscription revenues and monetization for premium publishers. At times this nudge has had to come from regulatory threats in an effort to create more balanced bargaining power.

But what are publishers seeking? Publishers expect traffic to their owned and operated platforms and true ownership over the customer journey including the underlying transaction and customer data.

Publishers also want to take back control over the pricing, bundling, and messaging for their services from the distribution platforms. This allows a trusted publisher to extract and retain more subscription revenues by controlling their highly-valued brands and, importantly, the customer data from before, during, and after their subscription relationship. 

Putting things in perspective

For decades, the vast majority of digital content was available for free.

Meanwhile, Netflix built its business on spending (many would say excessively) on licensing and creating content. It helped rebuild the consumer appetite for quality content and experiences worth paying for. However, when we consider the implications of the company’s recent subscriber losses, we should not be so quick to predict a ripple effect across subscription-based businesses as a whole.

While a couple of news publishers, and a handful of other streamers count their subscribers in the tens of millions, the reality is that most publishers count theirs in the tens or hundreds of thousands. Thus, the basis for comparison with Netflix’s 220 million subscribers is specious at best. That’s like comparing a slowdown in Coca-Cola’s beverage sales to my kids’ driveway lemonade stand.

And the behavior of younger consumers points to a healthy appetite for great content and a willingness to pay for it. Now is not the time to panic, pivot, or radically shift your subscription strategy in Netflix’s wake. Instead, trust in the value of quality content well-delivered in trustworthy settings and know that audiences will be right there with you.

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