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The echo chamber effect

July 18, 2019 Chris Pedigo, SVP Government Affairs – DCN

Echo Chamber: a room with sound-reflecting walls used for producing hollow or echoing sound effects
—often used figuratively.

Most of the time, echo chambers are amazing, secret shared spaces, acoustic marvels. See the Whispering Gallery of St. Paul’s Cathedral in London or the famous subterranean chambers at Capitol Studios in Hollywood.

Unfortunately, “figurative” echo chambers just don’t produce the same vibe. A prime example is my renewed optimism every March that this is finally the year for the Washington Nationals. I spend all winter reading and talking with other fans about which free agents the Nats have signed and why this will finally get them over the hump. Players talk about how they incorporated hot yoga into their offseason conditioning program, which I’ll translate to mean there will be a surge in home runs in the hot, humid DC summer. Advanced stats project breakout seasons for practically the entire roster.

Of course, there are plenty of critics out there to counterbalance my irrational optimism. Some are less articulate than others (hello, Phillies fans!). Even my loving wife cautions that the Nats will break my heart again. But, in the cold, dark winter, I willfully shut out all the haters in favor of my sweet summer dreams. And, yet, here we are still waiting for the Nationals to win their first playoff series.

Public policy is another arena in which echo chambers don’t support balanced, rational thinking. There are two recent prime examples surrounding major tech companies that are suffering from the echo chamber effect:

A more balanced approach

Facebook recently announced that it would develop its own digital currency, Libra. It’s a big swing with grand slam potential. Quite frankly, it makes a ton of sense as Facebook has massive scale and a well-suited combination of services. However, Facebook dramatically underestimated the reputational harm caused by the Cambridge Analytica scandal, its previous settlement with the FTC for privacy violations, a key area for banking and other regulators concerned about the ability of dark money to flow through Libra.

The company also failed to anticipate basic questions from lawmakers such as how much anonymity would be granted to users of the service. Their rollout strategy basically amounted to “we got this, bro!” At a Senate Banking Committee hearing this week, Facebook’s David Marcus was forced to concede that they will not launch Libra until regulators’ concerns are addressed.

Manipulation and the market

The Senate Judiciary Committee also convened a hearing to look at whether (and how) Google tweaks its algorithms to impact speech and profits. Admittedly, there is a lot we don’t know here. Even Subcommittee Chairman Ted Cruz (R-TX) acknowledged that he has only seen anecdotal evidence that Google deprioritizes conservative voices.

However, Google clearly prioritizes its own sites in search as well as the ads that net the biggest profits for Google. As the dominant player in the ad serving landscape, it’s clear that the company’s algorithms are tuned to make the most money for Google to detriment of consumers and competitors.

Free speech

There are major concerns about real and perceived behaviors that have major impacts on a wide swath of democratic discourse and commercial activity. So, against that backdrop, Google’s new global head of government relations wrote and testified that Google’s algorithms do not factor in political views. As evidence, he cited Google’s diverse workforce and one study. But, as Senator Josh Hawley (R-MO) reminded his colleagues, Google has a history of ideological censorship, such as when they accommodated the Chinese government to operate in that country.

Despite the duopoly’s posturing, lobbying, and academic influence, there’s a rising sentiment that they can’t be trusted. In fact, Senator Hawley pointedly asked Google’s head lobbyist “why would we believe you about anything?” Despite direct pleas from Senators Hawley and Richard Blumenthal (D-CT), Google wouldn’t even agree to have a 3^rd party conduct an independent audit to ensure compliance with Google’s stated claims of non-bias. The whole interaction underscores the fact that Google has essentially evaded Congress and the industry about how its algorithms work – often to the detriment of competitors and consumers alike.

Both Facebook and Google’s approaches to Congress felt like they had been developed in an expensive, lobbyist-enabled echo chamber. We can shake our heads at the ludicrousness of these situations. But the reality is that these duopoly built echo-chambers yield far greater consequences than the dashed dreams of a middle-aged baseball fan. These two companies shape public discourse throughout the world. They also dominate the digital advertising landscape, raking in massive profits, and deciding the winners and losers in the marketplace. Echo chambers are not the place in which balanced, constructive strategies are conceived. It is time we demand more from Google and Facebook than obfuscation and the raw exercise of market power.

Kids digital video is a perilous place and regulation may not be keeping pace

July 11, 2019 Bryson Masse – Independent Journalist

As children’s digital content consumption has come under the microscope and parents are realizing the extent to which popular online video services fall short of their expectations, federal regulators have voted to take away some of the guarantees protecting traditional sources of educational media. At the same time, others are calling on the Senate to leverage COPPA to reign in platforms’ approach to digital video and to enact new legislation to better keep pace with the rapidly evolving digital video marketplace. Clearly, the industry is at a crossroads and children are increasingly dodging traffic in the form of data collection, ad targeting, and unconscionable content—all of which would be unthinkable in the carefully moderated world of kids TV.

Unsurprisingly, YouTube is often found in the crosshairs when talking about objectionable digital experiences for kids. With issues stemming from lackluster privacy protections enabling extensive collection of childrens’ data to recommendations algorithms pitching inappropriate videos, the video social media network faces pressure from the Federal Trade Commission to turn around its platform. One idea from the company is to double down on its YouTube for Kids platform and effectively quarantine kids content from the rest of the site. However, to date, that approach has had some significant problems of its own.

Of course, it’s easy to see why parents like the service: It’s got tons of available content, it’s easy to find, and probably most appealing of all, the large majority of it is free.

Other services, from new market entries to the larger video services like Netflix, Hulu, and Amazon Prime Video (as well as upcoming competitors like Disney+), to traditional media networks have implemented features to better safeguard children. Companies like SuperAwesome are developing video platforms that take the risk out of kids content online for parents and advertisers. And Superawesome demonstrates the level of interest in this space, having raised $13 million in funding earlier this year, led by Harbert European Growth Capital. It was also ranked one of the U.K.’s fastest growing companies.

What’s changed

While YouTube holds great appeal and attracts massive audiences, it has yet to unseat one medium that has been guided by rules to protect children’s content for almost 30 years. That would be broadcast television. “It’s certainly the most powerful way to reach the biggest audience. You know, the demise of linear TV has been greatly exaggerated,” says Harold Chizick CEO of Chizcomm and Beacon, the largest media buyer in the children’s programming sector.

While the digital offerings from content companies are more robust than ever, and kids end up watching on more screens, Chizick says that there is a key difference: cowatching. Parents and kids are more able to catch content together when it’s on a larger screen where broadcast TV is usually found.

Additionally, the advertising industry has taken advantage of the dearth of younger eyes. And, in practice, kids end up not being able to avoid targeting technology that leverages collected personal information. That’s challenging as there additional protections for kids and their data under the Children’s Online Privacy Protection Act (COPPA) which advocates say the federal government is not doing enough to enforce.

Kid Vid

Although the online kids programming business doesn’t necessarily feel ready for prime time, the Federal Communication Commission voted this week to change the rules and regulations surrounding “Kid Vid” or the broadcast licensing requirements of children’s programming called. The changes were originally larger in scope when first proposed by Republican commissioner Mike O’Rielly last winter, in a vote of three to two among the commissioners, the FCC decided to enact an earlier start time for the programming (6 a.m. instead of 7 a.m.), removal of a mandatory 30 minute length for individual programs, and a reduction in reporting requirements for the broadcasters. Broadcasters will still need to air at least three hours a week of educational and informative content.

These changes make sense because broadcast stations need more flexibility to air other important content like local news and coverage of community events, as O’Rielly said in an op-ed at The Hill. As well, encroaching modernity has heralded the shift from linear TV to digital options meaning the burden of regulations falls only on part of the industry. “Notwithstanding this extensive competition in the video marketplace, local broadcasters are the only ones forced to operate under our Kid Vid rules,” he wrote.

In her dissenting opinion, Commissioner Jessica Rosenworcel said that she was concerned about the reliance on algorithmic recommendations for kids who watch content online. “This [proposal] follows on the heels of reports that automatic recommendation systems can present disturbing videos on the screen, one after the other. As a mother, I am not at ease when my kids before the computer and rely on algorithms to deliver their next video,” said Rosenworcel during arguments before the vote.

Modern regulation

Early on, the changes to Kid Vid had children’s programming advocates—and more recently a group of Senate Democrats—concerned. “The FCC’s assumption that children’s television guidelines are no longer necessary because programming is available on other platforms is simply wrong,” as three children’s television groups said in a fall 2018 filing to the FCC. “To obtain access to non-broadcast programming, households must have access to cable or broadband service, and be able to afford subscription fees and equipment. Many families, especially low-income families and families in rural areas, cannot access or afford alternative program options.”

Christopher Terry, assistant professor at the University of Minnesota Hubbard School of Journalism and Mass Communication agrees. In a phone call, Terry levied criticism at the shifting motivation behind the changes. Originally proposed as a first amendment issue in 2018, he said that was unlikely to fly due to the fact that the FCC has full mandate to regulate the content found on broadcast channel as licensing conditions. The reframing of the changes as a competition problem in an era of changing viewing habits, only came later. Even then, Terry questions who is actually benefiting from more competition.

“There is absolutely no upside for the people who use this programming in this proposal,” says Terry. “The only people who benefit from this is the FCC—they’ve got less paperwork to deal with—and the companies that are going to have more opportunities to figure out ways to get around this.”

With the FCC’s new rules moving forward nonetheless, the need for mature, responsible online platforms for kids content delivery is more critical than ever. Regulators want people to embrace the new online platforms, so there should be a destination which protects the interests of kids and their parents equally as any bottom line.

Access and third parties remain concerns as local news goes OTT

June 27, 2019 Bryson Masse – Independent Journalist

Local television news enjoys a somewhat unique vantage point among audiences: It’s America’s most trusted source of news according to the 2018 Poynter Media Trust Survey. Just over three quarters of respondents said that they either trust local TV news “a great deal” or “a fair amount,” beating out network news at 55% and online news at 47%. (Though local newspapers weren’t far behind broadcast at 73%).

But local news is not without its challenges, as younger generations change their viewing habits and cord cutting becomes more common. In fact, bridging those gaps are the stated goals of CBS’ new local news streaming services. Earlier this month, CBS announced the launch of CBSN Los Angeles. It’s the second local news over-the-top service offered by the Eye Network after a version in New York started streaming last December. Available 24/7, the service offers viewers access to not only the regularly scheduled one-hour news broadcasts, but also exclusive news and weather content produced by a dedicated team.

A local stream

The effort is built on the experience and infrastructure of the CBSN streaming service launched in 2014, according to Executive Vice President and General Manager of CBS Local Digital Media, Adam Wiener. “It’s an investment in innovation. We want to be wherever our consumers are and we’re creating product to meet that need.”

While bringing local news to an online streaming might feel like the natural next step in news delivery, there could be reasons it ends up more complex than that. “I love the idea of experimenting with local news,” said Christopher Ali, associate professor of media studies at the University of Virginia. “I’m a huge fan of it, we need to find different ways to keep local news going.”

Ali also points out that the corollary of the fact that younger people not watching the news, is that the main audiences are older adults, Unfortunately, at least at present, this demographic is the least inclined to adopt new viewing habits. He thinks the audience for local news could remain older as there are unique properties of the local news viewership.

Youthful news

For example, to combat declining audiences, a February 2019 report from the Shorenstein Centre and Northeastern University suggested that local news needs to look at online outlets like Vox for inspiration. But that might not be enough to change local news’ fortunes among the young, says Ali. “We tend not to settle down until we’re in our 30s, which means that local politics, local zoning issues don’t tend to matter, really, until we have kids or we buy a house,” he says.

Another factor that marks the CBSN services are their locations in major hubs. With LA and New York online as well as planned expansions to Boston and the Bay Area, there’s not yet talk for movement to smaller markets. “Places that are hurting for local news are the mid sized cities, your Kansas City or St. Louis. These are the ones where we’re seeing the collapse of the newspaper, and also the kind of a less robust television ecosystem,” says Ali. “So how do we scale what CBS is trying to do to make sure that these other markets, which are quickly becoming local news deserts, are going to be served as well.”

Since not all small towns and remote areas have fast internet, that could also stratify the potential audiences for digital local news broadcasts, Ali says.

Consider the source

Valerie Belair-Gagnon, assistant professor of journalism studies at the University of Minnesota, agrees that any move to digital will favor those with better internet access. However, she also says that local news’ move to OTT is “part of a larger trend of news organizations to rely on third party platforms to produce news, reduce costs and a reaction to the diversification and segmentation of audiences.”

While CBS certainly has control over its distribution offering stream access through a website, it also has apps located on the App Store, Google Play Store, Amazon’s Fire TV, and Roku’s streaming platforms. For (relatively) smaller companies, these relationships have also proven to be a challenge to navigate. Apple has been accused of anti-competitive behavior by Spotify, and the music streaming service has filed a legal complaint in the E.U. It alleges that the 30% cut Apple takes from digital purchases grants an unfair preference for their own product.

Belair-Gagnon also worries about the ultimate responsibility of creating journalism could be rendered ambiguous. “In a world where news organizations are increasingly relying on third party outside of regulated channels and where there is increasing opportunities for different forms of storytelling, whose responsibility is it to produce news? Who is liable when journalists relinquish their control over third parties?”

The bottom line is that the need for local news is great and experimentation with ways to serve this market is critical. However, there also remain important unanswered questions in the path to modernize the evening news broadcast.

As podcast advertising grows, big advertisers await better metrics

June 20, 2019 Maureen Morrison, Independent Marketing Consultant

There’s no doubt that podcasts are a growing business, as measured by audience and ad dollars flowing into the space. U.S. advertisers spent $479.1 million on podcast advertising in 2018, up 53% from $313.9 million a year earlier, according to a report released earlier this month by the Interactive Advertising Bureau and PricewaterhouseCoopers.

Those who have advertised on podcasts are often pleased. “Podcasts are a phenomenal opportunity for brands,” said Michael Duda, managing partner at Bullish, a creative agency and consumer investment firm. “We’ve seen tremendous results for our early-stage brands who conduct marketing programs that are synergetic to their target profiles.”

But many advertisers—particularly large, established ones—still feel they need more solid metrics to justify their spending. Groups like the IAB work to address these concerns through initiatives like the compliance program it launched in December, which certifies that companies are adhering to its technical guidelines.

Measurement challenges

According to the IAB announcement, podcast advertising lacks uniformity in measurement systems and metrics. Their statement also notes that “meaningful measurement has been thwarted by an inability to connect, track, and analyze user requests; measurement products that use dissimilar, proprietary algorithms; and a lack of an agreed-upon set of metrics and their meanings.”

Though standards exist, marketers say podcast advertising generally performs better for burgeoning direct-to-consumer brands and other early-and mid-stage advertisers versus the multinational, established stalwarts. “The early and mid-stage brands do better with podcast advertising because they can measure it more effectively,” said Steve Shanks, partner at Ad Results Media, an ad agency specializing in audio and podcast advertising.

The top five business categories of audio and podcast advertisers were direct-to-consumer brands, followed by financial services, business-to-business, entertainment, and telecommunications brands, according to the IAB report.

Common currency

But larger, more established consumer brands need additional reassurance from a metrics perspective if they are going to invest more heavily in podcast advertising. “The reason some larger brands don’t get into it is because with their media mix models they don’t know how to effectively buy this medium, and therefore the direct-to-consumer brands are smarter in the way they approach it and take advantage of the channel,” said Shanks.

“What the industry needs is one common currency of how we count downloads and making sure that all networks and shows are abiding by it,” he said. He added that the best standard now is IAB’s, “but not every network or show is abiding by those standards. If a download means something different depending on who you’re speaking with, it’s going to be hard for some of the larger brands to trust this space.”

Although some podcast networks may not adhere to these standards, Shanks said he’s noted that several of them “are making the effort to switch over.”

Hurdles to accurately provide universal metrics standards are numerous. The IAB’s standards note that “the ability to track podcast content and ad playback largely depends on the player requesting the file” and that only a sliver of “the market share enables client-side tracking as it exists in other forms of digital advertising.” The IAB also said that the Apple Podcasts app, for instance, commanded about 50% market share for podcast players, and yet prevented any client-side tracking or even the ability to count a “play.”

Targeting Improvements

Marketers also have a need to better target their desired audiences on audio platforms. Spotify wants to prioritize advertising around podcasts, and we’re beginning to see what that looks like. This week the company announced that advertisers can now target ads based on the podcasts people are listening to, according to the Verge.

Though these ads won’t be inserted in the shows themselves (they will run in between songs on its free service), advertisers can now “target based on the category of podcast they consume, which is likely going to be much more specific and fruitful for the advertisers.”

Test marketers for the new targeting service were Samsung and 3M. With this new ability, Samsung can, for example, target people who listen to tech and business shows, versus the previous targeting which was by age, gender, and music genre.

Audiences abound

Still, podcasts represent the opportunity for brands of all types to reach a growing audience. The IAB/PwC report projects that podcast ad revenue in the U.S. will generate $1 billion by 2021.

The preferred ad type for podcasts remains host-read ads, representing about 63% of U.S. podcast ads in 2018. Just over half of U.S. podcast ads are still direct-response ads, though that has decreased since 2016 from 73% as brand awareness ads grow in popularity.

Dynamically inserted ads continue to grow as well. In 2018, they accounted for about 49% of ads, up from 41.7% in 2017. Host-read ads, whether baked-in or programmatically inserted, tend to perform more efficiently than produced ads, said Shanks. He said this can be looked at like ads on influencer channels. When executed well, these provide much more value for listeners and advertisers, assuming pricing is the same.

Services emerge

In addition to Spotify’s efforts, we’ll continue to see more companies develop solutions to bring hefty ad spend to podcasting. This week in Cannes, audio platforms, media companies and agency networks are touting new audio and podcasting services to take advantage of the rise of streaming audio and bring more advertisers into the fold.

WPP and iHeartMedia announced a new venture called Project Listen, which will offer “creative consulting and media planning covering multiple platforms, including broadcast radio, digital streaming, podcasts, smart speakers and live events,” according to Ad Age.

“Project Listen is about tapping into the scale of audio and moving from the traditionally transactional radio business to the future of audio advertising where insights and ideas lead the way to growth for brands,” iHeartMedia CEO Bob Pittman said in a statement.

Pandora is planning to promote Studio Resonate, “a consulting arm that aims to help brands navigate tasks like creating a ‘sonic logo,’ which is a tune or sound that listeners associate with any given brand,” according to Ad Age.

So, while established brands may only be cautiously wading into the shallow end of the audio advertising pool, a slew of players are testing the format. And new solutions are being developed from all sides of the ecosystem so that the marketing and advertising opportunities sound as good as the podcasts themselves.

About the author

Maureen Morrison is a consultant and writer, working with agencies, startups, publishers and brands on marketing, editorial and communications strategies. She previously was a reporter and editor at Ad Age for 12 years, covering agencies, digital media and marketers.

Thinking inside the box: A look at news, niche, and inspired subscription strategies

June 13, 2019 Chris M. Sutcliffe – Independent Media Reporter

For the foreseeable future, publishers are pinning their hopes on digital subscription, on reigniting the direct relationship they initially lost in the initial pile into digital publishing. A recent study from the Reuters Institute for the Study of Journalism found that 69% of US and European publishers employ some form of paywall around their content, with the vast majority following a metered or freemium model.

Regardless of which model of subscription or membership each outlet has deployed, they each have similar challenges when it comes to the acquisition and retention of users. In that sense they are very similar to other subscription-based products in the entertainment space, from the OTT video services to the innumerable video games subscription services that have been launched in the last year.

The challenges are especially acute for news publishers, however, since news has become a commodity. The news market is flooded with free alternatives and news is not the subscription product most consumers opt for.

We find only a small increase in the overall numbers paying for any online news, and even in countries with higher levels of payment, the vast majority only have ONE online subscription – suggesting that ‘winner takes most’ dynamics are likely to be important. 2/7 pic.twitter.com/5AC0Jj2JrM
— Rasmus Kleis Nielsen (is offline, taking a break) (@rasmus_kleis) June 12, 2019

Boxed goods

However, just as the challenges are similar, there are success stories around other subscription products that news publications should consider emulating in their own approach to consumers.

One of those increasingly lucrative consumer subscription products is that of the subscription box. These generally take the form of a batch of products curated and delivered directly to you monthly, sometimes in partnership with a publisher. The range of products offered spans from apparel to hot sauces to sustainably sourced fruit and vegetables. And consumers are responding: Royal Mail predicts the market will be worth £1bn by 2022, and that over a quarter of the UK population has already signed up for a subscription box.

Katie Vanneck-Smith is the founder of Tortoise, a “slow journalism” publisher with a focus on membership. She told me that publishers can take valuable lessons away from the rise of products like subscription boxes, and that publishers have “only just started to catch up with the consumer behaviours in the industry”. So what can news publishers learn from the growth of those products, particularly around engaging and retaining subscribers?

Curation as a service

The value of a subscription box lies in the fact that its contents have been specially selected for the consumer base. Subscribers trust that the brand behind the box has the expertise required to choose only the best goods to serve up. And this is doubly true when the box contains luxury products rather than staple goods. Boxes like Loot Crate and Stitch Fix trade off the fact that they have the connections and knowledge to deliver products that are relevant to the receiver. Crucially, they both play up the fact that human editors are the ones ultimately doing the curation, rather than just an algorithm.

In that sense, those subscription offerings are very similar to products from high-end publishers. This includes The Times & Sunday Times, which make the curation of stories relevant to their audiences a core tenet of products like The Brief. Both leverage the fact that, in a sea of products, there is value in having an expert pick out only the best ones on your behalf.

Churn is a fact of life, so cater for it

It typically costs around five times more to acquire a new subscriber than to retain an existing one. That’s why so many publishers are avidly focused on the development of their own internal engagement scores, to determine when people are likely to jump ship and hopefully to intercede. The Times in particular has invested a huge amount of money in reducing churn along every part of the process, but it is effectively a universal concern among subscription-based products.

However, while the quality of the provided service is ultimately the best guarantor of user retention, sometimes factors outside of a publisher’s control will inevitably cause people to consider dropping off. In that case, as with subscription boxes, publishers need to offer solutions that cater to their audience’s changing situation. Ecommerce platform Cratejoy found that customers typically gave financial reasons as the cause for cancelling a subscription box, and advises that subscription boxes offer a “downgrade” option.

Increasingly, publishers are doing the same. They offer flexible options or discounts to the subscribers who contact them to cancel. Some publishers are also considering a wider rollout of a pause option for subscribers. This has the dual benefit of keeping them within the logged-in ecosystem for marketing purposes while also negating the high cost of reacquiring a lapsed subscriber.

Have a mission

Subscription packages like ODDBOX make a social mission part of their sales strategy: much of its messaging is based around the notion that food wastage is a significant issue, and that subscribing is the right thing to do to combat a problem. Similarly, the Guardian found that the rhetoric it employed around its membership scheme had a significant impact, and that choosing to support open access to journalism for everyone was frequently cited as one of the most important reasons people chose to donate.

Notably, when the Guardian reached its milestone of a million paying users, it chose to change the messaging from one of survival to one of sustainability. Consequently, it saw its best week ever in terms of donations. This ran counter to internal misgivings that fewer people would choose to support it no longer appeared in peril.

The fourth subscription

At the World News Media Congress in Glasgow, co-editor of the Innovation in News Media World Report Juan Senor suggested that a consumer is likely to pay for four subscription services. The first two would likely be entertainment services, the third a general news subscription, and the fourth to a niche site they have a personal interest in.

While people typically feel affinity to newsbrands, the trend towards personalization of content means that publishers can typically serve up content tailored specifically to them. Effectively, they are increasingly hybrids of the third and fourth subscriptions. For example, The Telegraph recognized that its rugby content was of particular interest to its audience. So, it recently made all its content around the sport a key part of its subscription proposition, one of only three types of article to sit exclusively behind the paywall.

When it comes to marketing that specific content, publishers could do much worse than to emulate the techniques employed by subscription boxes, which are by their nature niche. The products themselves – news and goods – are very different in nature, but the lessons around messaging and retention are universal.

Behavioral advertising: The mirage built by Google

June 6, 2019 Jason Kint, CEO – DCN

Important new research was recently presented at a major economics conference and reported on by the Wall Street Journal. The comprehensive study was conducted over nearly five years by Veronica Marotta, Vibhanshu Abhishek and led by Alessandro Acquisti, who is globally recognized for his work studying behavioral economics and the impact of privacy on digital society. The bottom-line: Acquisti’s team found that behavioral advertising, as measured and delivered based on third party cookies, increased publisher revenues by a mere 4%.

If you’re nodding your head unsurprised by this statistic, then you’re likely in the 67% of publishers surveyed recently by Digiday who answered that behavioral advertising doesn’t help their business. But make no mistake, the findings are profound as to how they inform the future of digital advertising. They will also have a strong influence on the next steps in US privacy legislation. Put simply, nearly all of the growth touted by the industry benefits intermediaries rather than the publishers who provide the news and entertainment. And for the first time ever, there is empirical research to dismiss long-touted industry arguments that privacy rules will kill the golden goose that pays for free content.

Implementing new rules

This empirical study makes it clear that the absence of rules has overwhelmingly benefited intermediaries. (This would also explain the market caps of a few of the biggest intermediaries.) And now, there remains a singular challenge: No individual publisher can change tactics unless all significant publishers move in lock step. That’s because individual companies would lose significant revenues moving on their own, even on behalf of consumers. Therefore, the bar must be raised equally, through a combination of tech and regulation.

Google is the most critical company with the most to lose and will have a seat at the head table no matter where the market or regulators take us. It will be critical for individual publishers to be able to move in the best interests of consumers and their fellow publishers without being held back by Google’s stronghold. Reuters reports that “Google has repeatedly said that it acts in the best interest of its users and offers sufficient warning to industry partners potentially affected by its moves.” We’ll see.

Recent experience suggests that Google will not cede ground. A friendly reminder that when GDPR rolled out last May in order to better protect the privacy interests of EU citizens, Google waited until the final days to push through its own interests. Global publishers had to send a formal letter of concern to Google’s CEO. They also filed a copy with every major competition authority in the western world.

Built on a shaky foundation

Much of the digital advertising marketplace and Google’s business have been built on direct-response advertising in which clicks and audience targeting are valued more than the media that surrounds it. This presents a challenge for media companies which have invested heavily in high-quality, premium news, and entertainment environments. Unfortunately, the largest part of the digital advertising market was whittled down to little more than an efficient delivery vehicle for cookies auctioned off to the highest bidders. And little has been done to dismantle this poorly-built foundation. Rather, our entire industry – data brokers, ad tech platforms, agencies and publishers have fueled these direct-response metrics by doubling down on them through behaviorally-targeted advertising.

The premise? That the new capabilities to collect and use browsing data across the web eliminate the waste in advertising, giving marketers their long-sought dream of one-to-one targeting with real-time measurement and publishers a share in the spoils to help fund their digital growth. And, through these same data reservoirs, advertisers could focus on cherry-picking consumers as efficiently as possible. This spawned a slew of sites optimized not for long-term relationships with loyal audiences but instead for their ability to create diverse cookie pools for these real-time markets.

The 800lb gorilla

Google was a company built for the direct response economy post-2009. Due to several years of belt tightening after the 2008 financial crisis, chief financial officers had more pressure to ensure that marketing investments met the quarterly demands of shareholders. And boy did Google deliver. Google did everything it could to maximize the personal data in its coffers and to minimize friction for advertisers who wanted to micro-target people based on it.

Some history:

When web browsers were on the cusp of consumer privacy innovation by restricting tracking cookies, Google lobbyists hindered industry progress. At the same time their own browser, Chrome, took a dominant seat in the market.
When consumer ad blockers became a risk to Google’s data collection, Google began a series of secretive deals and payments in order to whitelist their own data collection tags and later commandeer a browser solution to protect its own ad formats. This saved the company billions in revenue while everyone in industry took a hit.
When a more privacy-focused mobile environment emerged from Apple, Google continued investing in its privacy-porous Android device. It earned a $5.1 billion fine for its efforts. Google also launched its own code layer in AMP. This provided the company deeper influence on what can be on publishers’ websites.
Google wrestled control and influence over the ad tech supply chain used by competing publishers through a series of targeted acquisitions.

Market dominance

The fruit of its labors is an advertising market optimized for its own interests.

Who conducts the most bids to buy advertising in these real-time markets? Google.
Who offers up the most bid requests to sell advertising in these real-time auctions? Google.
Who operates the most negotiations between buyer and seller? Google.
What is the most valued asset in digital advertising? Personal data.
Who owns the most personal data? Google.

Put another way. Google is the largest buyer, seller, and transaction vehicle for digital ads that leverage personal data. And Google has by far the most personal data. At this point, it should hardly be a question whether this is a rigged market.

The numbers are startling. In the past decade, Google’s SEC filings show that the advertising revenues Google delivers across its vast network of millions of publishers have barely doubled, having grown from $9 billion in 2010 to $20 billion last year. However, in the same ten years, Google has quadrupled its owned and operated advertising revenues from $28 billion to a whopping $116 billion last year.

Search was (and is) the monopoly that privileges entry into any other business by Google. However, the rich interest profile that can be assembled by harvesting personal data across its operating system, browser, ad services, analytics, and its own properties comprises a behavioral advertising fortress.

The anticipated Department of Justice decision to investigate Google is the company’s worst nightmare in terms of timing on these issues. Already we’re seeing influencers and former competitors begin to open up about bad conduct in Mountain View. Inevitably, there will be more details and more reports. It’s critical to the process—and the future of digital media—that light be shone on their activities.

Without a doubt, the investigation means that Google will have a harder time finding friends in the publisher and ad tech communities. However, it’s unlikely you’ll hear publicly from many of them. And therein lies the ultimate symptom of antitrust: No company wants to cross Google. But the word “frenemy” will cut in a different direction now: You won’t find anyone watching your back when you’re under the regulatory microscope.

The rise of ad tech intermediaries

All of this said, Google wasn’t alone in its attempts to reap the spoils of the behavioral advertising marketplace. In the period between 2010 and 2016, hundreds (if not thousands) of new companies spawned in the ad tech wild west. By my count, there were 78 ad tech companies starting with the letter “A” in 2016 and today 64 of the 78 have either been acquired or disappeared from the industry. History will determine whether most (if any) of these companies had a lasting impact on the industry.

The core proposition of nearly all of them was to serve a burgeoning programmatic marketplace in which third parties could be inserted into the supply chain in return for value. The typical webpage went from dozens of third parties to hundreds. This triggered a real-time competition for eyeballs, most often represented by third-party cookies.

Personal data was collected by these third parties without consumer knowledge or control. The data was then used to target consumers across the web, as cheaply as possible. All of this was done outside of consumer expectations which led to the “adtechlash” with the rise of ad blockers, various levels of tracking protection launched into Chrome’s “competition” web browsers Safari, Brave and Firefox, and new privacy laws like 2018’s GDPR and CCPA rolling out in 2020.

Now we find ourselves on the eve of new laws globally to better align with consumer expectations. Publishers need to be fierce defenders of these consumers and protecting their experiences. Ultimately, the fight to defend behavioral advertising likely isn’t worth it. At the very least, every publisher and their representative organizations should make certain whose interests they’re fighting for. This will determine who benefits over the next ten years.

The bots among us: Artificial intelligence and automation are hard at work in the media business

May 23, 2019 Erik Martin—Independent Journalist

C-3PO as a nightly news anchor? Alexa winning a Pulitzer Prize? These silly scenarios sound like the stuff of science-fiction. But the reality is that automation, which often takes the form of artificial intelligence and machine learning, is increasingly infiltrating the fourth estate and impacting how media companies gather, report, deliver, and even monetize the news.

From transcribing to fact-checking and polling to tweet parsing, artificial intelligence has been hard at work in newsrooms for years. However, the number of organizations large and small—including giants like The Washington Post, Forbes, AP and Reuters—using AI and machine learning to compose content is on the rise. And that’s got the industry and consumers sitting up and taking notice.

Naturally—along with those in a number of fields—there are journalists worried about being replaced by automation. However, there are many who embrace these technological advancements, seeing them as useful assistants that help process and distribute the news.

“AI can help journalists cover and deliver the news more efficiently by freeing them from routine tasks, identifying patterns in data, and helping surface misinformation,” said Lisa Gibbs, the Associated Press’ director of news partnerships.

Chris Collins, senior executive editor of breaking news and markets at Bloomberg, agreed. “Technology is good at repetitive tasks and newsrooms tend to be overloaded with those. If you leverage technology to help with them, journalists can spend more time doing journalism—interviewing sources, breaking news, writing analysis and so on,” said Collins.

Success stories

Bloomberg built Cyborg, a program that extracts key info from corporate earnings reports and press releases. Bloomberg also has AI-assisted monitoring tools that rely on machine learning to filter out spam, recognize key names, and classify topics to cut through this noise and capture specific events relevant to Bloomberg’s financial audience.

“By doing that, we’re able to be more competitive when it comes to identifying news events,” said Collins.

AP uses a similar AI resource to automate corporate earnings articles. It also employs video transcription services that create transcripts for its broadcast customers, saving AP’s video operations personnel precious time.

Additionally, the AP’s newsroom is beginning to focus more on how AI can help the news-gathering process itself. “We recently completed a test of event detection tools, such as from SAM, which uses algorithms to scan social media platforms and alert editors when it has identified likely news events,” said Gibbs. “What we found is that using SAM, in fact, does help our journalists around the world discover breaking news before we otherwise would have known.”

Reg Chua, COO of Reuters Editorial, said his organization has been using AI for several years. “A lot of it is your basic automation stuff like scraping websites and pulling stuff off feeds and then turning them into headlines published automatically or else presenting this information to humans for checking before we publish. We also employ quasi automation and technology that scans and extracts important information from documents,” said Chua.

Reuters News Tracer filters noise from social media to help discern fact from fiction and newsworthy angles from countless tweets and posts.

One of Reuters’ newest AI tools is News Tracer, which filters noise from social media to help discern fact from fiction and newsworthy angles from countless tweets and posts. “News Tracer’s core function is to tell journalists about things they didn’t know they were looking for—to quickly find news that can be reported on,” said Chua, who added that the tool provides a newsworthiness score and a confidence score to help reporters determine what to focus on.

Big and small papers benefit, too

RADAR (Reporters and Data and Robots), a London-based news service, has been a trailblazer in the realm of AI-reported local news.

“We operate as a news agency with a subscriber base of UK local news publishers,” said Gary Rogers, RADAR’s editor-in-chief. “We employ six data journalists. Our reporters work largely with UK open data, seeking out stories that will be relevant and informative for local audiences. They work as any data journalist might in finding the stories, but they use software as their writing tool in order to produce many localized versions. These are distributed to local news operations all over the UK.”

Rogers noted that AI allows RADAR to achieve a scale of story production that would not be possible by human effort alone.

“We tackle about 40 data projects each month. Each project will yield an average of 200 to 250 localized versions of the story,” said Rogers. “Since last autumn, we have been producing between 8,000 to 10,000 stories per month.”

Smaller community newspapers are investing in big machine learning capabilities, as well. Case in Point: Richland Source, a Mansfield, Ohio daily, uses a program called Lede AI to automate local sports reporting.

“Lede Ai writes and publishes game recaps for every high school sporting event in Ohio immediately after it finishes,” said Larry Phillips, managing editor of Richland Source. “If it’s a big game, we will send a reporter and Lede Ai writes and publishes the first draft; our journalist adds color, flavor, and flare that can only be done by being at the game. With Lede Ai, we’ve never received a complaint about inaccurate reporting, and we’ve published over 20,000 articles.”

Education and transparency

News media professionals worry about human obsolescence in the face of such quickly accelerating automation. Yet many believe those concerns are premature or misguided.

“While this has been true in most industries and may happen in media, there is a broader picture of AI’s enabling rather than employment-destroying qualities,” Rogers said. “AI can take over repetitive and boring tasks, which frees journalists to do more important work. It can help journalists find stories by sifting large amounts of information. In our case, it allows our reporters to amplify their work, write a story in the form of a template, and produce hundreds of versions of the story for local newspapers across the UK who lack the resources to do it themselves.”

Consider, too, said Phillips, that “AI still can’t ask follow-up questions, can’t knock on the doors of multiple sources, work a beat, make a follow-up call, do the shoe-leather grunt work, garner an off-the-record comment which leads to a story angle, and certainly can’t replicate the human element, the nuance, that encompasses the very best work in the profession.”

Even if their human resources are relatively safe for now, news organizations have to navigate carefully through uncharted waters when it comes to ethics around and disclosure of AI practices.

“As these technologies evolve, having standards around transparency and best practices – such as how do we prevent bias in data from impacting our news coverage – will be critical for the entire industry,” added Gibbs.

Bloomberg’s Collins echoes that sentiment. “It’s essential to understand what technology can and can’t handle. Clearly, as with all journalism, you need judgement, best practices and processes in place to ensure what you are writing is accurate, fast and worthwhile,” said Collins. “You need to be transparent about how a story was produced, if it was assisted or published using AI. In our experience, the combination of years of human journalistic experience with technology such as AI is powerful. Obviously, the technology isn’t left to run the newsroom. It is trained and overseen by journalists, who are learning new skills in the process.”

Reading the tea leaves

Looking ahead, artificial intelligence will create exciting new capabilities as well as troubling obstacles, say the pros.

“As newsrooms increasingly embrace AI, it will help with everything from spotting breaking-news events, to finding scoops in data to audience personalization,” said Collins.

But prepare for even more fake news fiascos.

“Distribution of so-called deepfakes, assisted by AI, is a troubling trend,” Collins cautioned. “How technology evolves to both spread and combat misinformation will be a major challenge for the industry.”

Yet Richland Source publisher Jay Allred and others remain optimistic. “In the near-term at the local level, I think AI will largely be used for two things. First, it will fill the gaps on informational journalism tasks that simply are not done anymore due to shrinking payrolls,” said Allred. “Second, it will surface insights from public databases—finding out, for instance, how a particular city floods and where, how many speeding tickets were issued and where throughout a state, where do the most citations for drunk and disorderly conduct occur within a city. This will spur and support investigative journalism that wouldn’t otherwise happen.”

What policy makers can learn from privacy-focused products

May 16, 2019 Chris Pedigo, SVP Government Affairs – DCN

The legal and policy community continues to debate the impact of General Data Protection Regulation (GDPR), the ins and outs of the California Consumer Privacy Act (CCPA), and how (or whether) Washington should regulate consumer privacy. While the debate rages on, we are seeing a stream of consumer-focused privacy-oriented product rollouts. It is interesting to look at what these controls actually do and how they might inform the policy debate.

In a concession to consumer privacy, Google recently announced that it would allow consumers to block companies from tracking them across the web when they are using Chrome. Specifically, they will differentiate between 1^st party and 3^rd party cookies. As such, they will allow consumers to delete 3^rd party cookies while preserving the 1^st party cookie, which, for example, allows a website to remember a consumer’s log-in information. In addition, Google will soon roll out features to prevent companies from identifying consumers via device fingerprinting, another method used to track consumers across the web.

Let’s be clear, Google is late to the privacy game given the long history of privacy protections offered by Apple and Mozilla. Apple has famously blocked 3^rd party cookies by default in Safari and recently introduced Intelligent Tracking Prevention (ITP), restricting the ability of companies to access cookies when a consumer is not interacting with that company.

Services that care for consumers

When a consumer visits YouTube on Safari, Google can access the cookies they have set on their browser. However, as soon as the consumer navigates to another website, Google can no longer access those cookies. ITP essentially breaks the ability to track consumers around the web. Apple has also worked to block loopholes where cookies, set by companies like Google and Facebook, pretend to be 1^st party but are then used for tracking and secondary use. Unfortunately, it is hard to muster much confidence that Google will be anywhere as diligent as Apple in closing loopholes, given its business model is built on its ability to expertly track consumers.

Mozilla, on the other hand, offers multiple ways for consumers to block third party tracking in Firefox. Mozilla is also considering rolling out a “Super Private Browsing” mode, which would incorporate Tor privacy features into Firefox.

Beyond the most commonly used browsers, a whole suite of new services have popped up. Duck Duck Go, a search engine, and Brave, a browser, offer strong privacy controls as their primary value proposition. As we’ve noted for several years now, more and more consumers are turning to ad blockers to protect themselves and/or improve their web experience. Forcing these massive platforms to once again compete on privacy will be good for everyone, particularly consumers. The question, of course, is whether some of these companies are simply too big to change at this point.

Policy implications

Back to my original question: What can policymakers learn from these new consumer privacy controls?

For starters, consumers increasingly demand more and stronger protections of their data and digital lives or the market wouldn’t be headed that direction. You can reasonably debate whether Google’s recent announcement went far enough. But the fact that a multi-billion-dollar company like Google did anything at all speaks volumes.

It’s also worth pointing out that all of these new controls, which curtail the ability of companies to collect consumer data at scale, are not actually breaking the internet despite the frequent claims of ad tech lobbyists. In fact, given this push to meet consumer demand for greater privacy controls, it’s funny and a little sad to look back at the hysteria from some of these lobbyists.

Meeting consumer demand

The big takeaway is how these companies and their engineers are designing services and features to meet consumer expectations for privacy. This new wave of privacy controls gives consumers the ability to stop companies from tracking them across the web. Yet, these services preserve the ability for websites and apps to collect and use consumer data when the consumer is interacting directly with that company.

This approach makes sense. Consumers share their data so that companies can use it to provide a service or content. In this fair value exchange, the consumer can choose to engage or not. Consumers do not expect companies to track them outside of that fair value exchange and doing so is simply bad business.

It isn’t a question of whether consumers want their privacy protected, these market moves demonstrate the demand and inevitability. And, as policymakers consider how best to craft consumer privacy protections, it’s worth noting how today’s best engineers have attempted to meet consumer demand and expectations for privacy.

Are the NewFronts still worth it for publishers?

May 9, 2019 Mark Glaser, Founder and Publisher – MediaShift

Certain terms like “new wave,” “new school,” and “online video” start to lose their meaning over time. The same seems to be true of the “NewFronts,” now in their eighth year in New York. The showcase for traditional and digital native publishers selling their video offerings to marketers has been split up into twice-per-year affairs (with a fall showcase in L.A.). Just 16 publishers presented in New York this year, down from 36 in 2017.

The idea of the TV Upfronts and NewFronts are to dazzle advertisers and get them to commit a chunk of their advertising to the publisher, though there is less scarcity online. Have the NewFronts made progress over the years? Most definitely. Has that progress meant there is no need for them anymore? Not quite.

What’s most interesting at this year’s shindig is that traditional players are pushing new acquisitions and initiatives, while the digital natives are trying to sound more traditional with ongoing series. This points to a convergence of purposes and the fact that online video, OTT, streaming video et al have commingled to the point of absurdity. This leaves marketers grasping at just what they’re buying and how they can track and optimize it all. And yet there’s still a place for publishers at the NewFronts as a showcase for offerings and to generate much needed buzz.

Platform domination

The biggest challenge for publishers, as always, is trying to stand out from dominant players like Hulu, YouTube, and even Twitter. And the dominant players just get more dominant. YouTube casts an immense shadow as the largest ad-supported video platform online. But, as Digiday’s Sahil Patel points out, YouTube users are spending 200 million hours per day watching YouTube on a TV, up from 100 million hours last October.

And Hulu hit $1.5 billion in ad revenues last year by offering a mix of legacy TV programming and original shows. During its NewFronts presentation, Hulu execs pointed out that they have 26 million paid subscribers, and a much younger audience than cable, at 31 years old vs. 53 years old. Plus, 80% of Hulu viewing takes place on a TV set, up 75% from last year. (And Hulu even sponsored Digiday’s coverage of the NewFronts.)

This puts many publishers in a bind because they have to sell their uniqueness to advertisers while also cutting deals with the platforms to expand reach.

“Mass reach is still a thing,” Mediahub’s Michael Piner told Digiday. “And there are certain partners that are being prioritized because they can achieve the mass reach of TV.”

What do publishers get?

So what do publishers get for their money and trouble at the NewFronts now? Well, the decrease in presenters means they do get more attention from attendees. And at least one publisher, Studio71, was touting its upfront ad sales. The company has presented at the NewFronts from 2016 through this year’s edition. Studio71’s CEO Reza Izad told Digiday that 85% of their revenues each year came from upfront commitments. They boast 100 million unique viewers per month on YouTube and vet each piece of content on the network.

Still, many publishers such as Group Nine and Refinery29 decided to forgo the NewFronts for a private tour to increase intimacy – and likely save costs. The increased competition for digital video ads is partly to blame, and people are also paying more for services such as Netflix and HBO that don’t serve ads at all.

But it’s still hard to ignore the growth of digital video, especially if you sell video advertising in entertainment. The IAB’s Video Ad Spend Report surveyed marketers and found they would be spending $18 million on average this year on digital video ads, up 25% from last year, with the Media/Entertainment vertical up a whopping 75%. (And yes, that means studios are buying more ads on other media.)

Switching places

Meanwhile, notable presentations from Meredith and Conde Nast discussed new shows for their OTT services, and Meredith is also distributing them through its local TV stations. And as OTT moves into broadcast, cable network Viacom was showcasing content on its newly acquired PlutoTV OTT service.

“Viacom is embracing digital inventory, and at the same time we see Condé and Meredith pushing themselves into the OTT universe,” Wavemaker’s Noah Mallin told AdAge. “They are starting to resemble each other more and more.”

As AdAge’s Jeanine Poggi’s so astutely points out, this is the year when the NewFronts actually looked a lot like the regular TV Upfronts, with the themes of brand safety, original programming, and scale. “This year more publishers spoke about renewing existing shows, creating long-form content akin to TV and positioning themselves as the new ‘primetime,'” Poggi wrote.

So where does that leave publishers and the IAB? Perhaps the time has come to ditch the NewFronts and merge them into the regular TV Upfronts. More importantly, publishers need to calculate carefully the benefits of a flashy program on stage at the NewFronts, and whether that still beats a private tour or other marketing outreach. Ultimately, it will take a new round of upstart video-centric publishers who want to make a splash to inject new energy into the NewFronts.

The cannabis business is booming. So how about the cannabis ad business?

May 2, 2019 Maureen Morrison, Independent Marketing Consultant

Do a search for cannabis-related articles and thousands will come up in the results. And with good reason: Recent years have seen the legalization of it in 10 states now, with 33 states allowing marijuana for medical use. This has given way to countless articles written about the burgeoning legal industry and startups offering cannabis and CBD products.

Billions of investment and consumer dollars are flowing into the legalized cannabis space. Last year, legal cannabis was a $10.4 billion industry in the U.S., employing a quarter of a million people, according to New Frontier Data, a cannabis market research firm. According to a report from the Associated Press citing New Frontier Data, “Investors poured $10 billion into cannabis in North America in 2018, twice what was invested in the last three years combined… and the combined North American market is expected to reach more than $16 billion in 2019.”

But for all the explosive growth of this new and legal market, the advertising part of the equation has not kept pace. The largest digital platforms don’t allow cannabis ads. Cannabis articles may appear on many publishers’ sites, but few allow advertising of these products. The fact is that cannabis is still a Schedule I drug in federal law, and the Controlled Substances Act of 1970 prohibits advertising and selling of such products. State laws vary widely, causing many with ad space to sell to err on the side of safety.

It’s no surprise, then, that many of the publishers reached for this article just don’t allow cannabis advertising, particularly in national publications. One major publisher with a number of popular titles said that it doesn’t accept cannabis advertising. Though it does accept ads for topical cannabidiol (CBD) oil products to the extent allowed by law.

Publishers leery of cannabis ads

Meredith Corp. said that it doesn’t accept any marijuana or cannabis-related products (including Marijuana-based THC, Cannabinol [CBN] or CBD products) or any other product that’s illegal under U.S. law. One exception the company now allows is Epidiolex, which contains CBD and has been approved by the FDA to treat childhood epilepsy and can be legally advertised for such use under federal law.

Meredith said it also now accepts industrial hemp-related products, including Hemp-based CBD or CBN products, with THC content of 0.3 percent or lower. Hemp products of this sort were previously illegal under the Controlled Substances Act. However, they were made legal under the 2018 Federal Farm Bill, enacted in December 2018.

There’s more leeway on the local publication front. Local newspapers and publications in states where cannabis is legal for recreational use may have an easier time accepting ads, depending in state law. The Seattle Times, for example, accepts cannabis advertising.

“Cannabis advertisements are reviewed by our staff to ensure they meet our general advertising creative and copy policies. There are Washington State rules for this category of advertising, and we comply with those requirements,” said Gary Smith, VP of advertising at the Seattle Times. “While there are complexities around accepting this type of advertising, it has been a growing part of our overall client mix. And we’ve had very few customer complaints associated with the inclusion of this ad content in our products.”

Is the duopoly doing it?

Publishers need not worry that they’re losing out on cannabis ad dollars to Google and Facebook. Both have shied away from allowing cannabis ads. Google’s policies state that ads promoting products that alter mental state for recreational use, including “legal highs,” are prohibited.

Facebook similarly prohibits such ads, though the company reportedly formed a group to “examine its approach to cannabis,” which suggests that it could be moving towards a more permissive stance. In the meantime, state legal cannabis businesses are allowed to create verified business pages on Facebook, and appear in search results (they were previously blocked from search),” according to Bloomberg Law.

Varying state laws are a hurdle for brands that want to market cannabis products in multiple states where it’s legal. And given that that Google and Facebook don’t allow cannabis ads, and that many publishers shy away from them, Cannabis brands often rely on outdoor advertising and sometimes even events.

The brand perspective

Jason Deland, co-founder and chairman of cannabis brand Dosist and founding partner at ad agency Anomaly (which handles advertising for Dosist), said that their media strategy has largely prioritized outdoor advertising for creating awareness. Zoned areas that allow for outdoor cannabis advertising in California have helped Dosist build its brand, as has its retail location on Abbot-Kinney Blvd. in Los Angeles’ Venice Beach.

Dosist has also had event partnerships with Barry’s Bootcamp, with messaging focused on sleep and the health benefits of cannabis. The company also has advertised with Cannabis-friendly publications like High Times. As for social media, Deland says that Dosist creates organic content on its own pages.

Other brands have tried to circumvent the social media ban on cannabis ads by using influencers to promote their products or promoting prices on their own social accounts. However, that can have its own set of headaches and influencers can sometimes have murky return on investment.

For now, it seems like unless there is a change to the categorization of cannabis at the federal level, most companies with ad space to sell won’t allow cannabis advertising anytime soon. There are the rare exceptions of course, as noted above with Epidiolex, and more of those may come in the future as pharmaceutical companies look to get more cannabis-related drugs approved. Others are hopeful that with the recent allowance of industrial hemp products to be advertised – thanks to last year’s Farm Bill – that the federal government will ease up eventually on cannabis, but only time will tell.

About the Author

Maureen Morrison is a writer and consultant, working with agencies, startups, publishers and brands on editorial and communications strategies. She previously was a reporter and editor, and spent 12 years at Ad Age covering agencies, digital media, and marketers.

The New York Times helps consumers decide where to draw the line on privacy

April 24, 2019 Bryson Masse – Independent Journalist

The waves of negative press about privacy intrusions and breaches are becoming a regular occurrence. Yet the outrage cycle seems to have a short lifespan and there’s confusion and a range of expectations when it comes to data collection and usage. That said, consumers need to remain vigilant about new and unexpected ways digital organizations leverage personal data collection.

Already, we face some pretty significant questions: Do you want your genealogy company to sell analysis based in your DNA? Your smart doorbell clips accessible by warrant? Mugshot-matching facial recognition capabilities?

That’s why Stuart A. Thompson, graphics director of The New York Times Opinion section, and his team set out to figure out how people report their comfort levels in terms of sharing different kinds of personal information. The work, published earlier this month, is part of the ongoing Privacy Project at the paper. It’s a series examining the different ways private groups and governments are using personal information.

Understanding the limits

Perhaps encouragingly, The Times found that consumers are taking notice of the data collection policies of the services they chose to use. But they’re not exactly excited about it when they find out. Many of the activities asked about — which were found to be outside of 90% of respondents comfort levels — are already employed by tech companies.

Readers were asked about their comfort level about the various ways companies use, or could use, personal information. Credit: New York Times.

Thomson also said that there the results offered clear take always for digital publishers. Acknowledging the reliance on third party tracking in the news site business, he explained that blind acceptance of those practices could be coming to an end. “Even if you have an airtight privacy policy that you feel ok with now, you might not feel as okay with it when people start paying attention to what you’ve done or criticizing what you’ve done,” said Thompson.

Privacy by design

Thompson said the goal of this project is to learn what was “the line” for his readers and he used a pretty clever page layout to do so. Readers scroll through increasingly intrusive privacy scenarios and then place a line over the example which they felt uncomfortable with. This skeuomorphic interaction is a technique that The Times has previously used with good results.

“Drawing things was a New York Times/Upshot trademark way to get people to interact with us,” said Thompson. “We were talking through as a group, and I think we kind of fixated on the line.”

One element Thompson wanted to address head-on was the idea that consumers continue to make privacy related decisions that aren’t in their interest, dubbed the privacy paradox.

Understanding the big picture

However, to Thompson, they’re not acting irrationally or unexplainably. People are just caught in larger systems. Individuals aren’t given real opportunity to give consent of the personal data use, such as in cases where data is required to be handed over in order to access a service, and there aren’t consumer guardrails around those practices.

With appropriate regulation, consumers shouldn’t “have to read every detail of a data policy or a privacy policy to consent to what’s happening, because you have to do that a dozen times a week,” said Thompson. “We’re not prepared for that kind of activity and we’re not very good at it.”

He added that tech companies have taken advantage of consumers’ difficulty with risk management. As a result, governments and regulatory bodies have had to enact legislation like the General Data Protection Regulation in the European Union.

The stakes get bigger

Another example of the push back against the surge in the surveillance economy was a lawsuit against the efforts by Alphabet subsidiary Sidewalk Labs in Toronto. The plan to build a smart city in the portland’s of Canada’s largest city could incorporate any number invasive new forms of data collection.

To nip that in the bud, the Canadian Civil Liberties Association launched an application to sue on the grounds that the wholesale data collection of people who just happen to be in the area aren’t allowed under the Charter of Rights and Freedoms protections including against unreasonable search and seizure. While this case is immediately relevant for the smart city project, it could help society establish a point at which it “draws the line” about privacy overall.

But at the end of the day, the path to better privacy management could start closer to home.

“As publishers are working in the public interest, maybe they have an additional responsibility to declare what they’re doing,” said Thompson. “You could argue that they are acting in this pure business sense and they have their own lines that they’re willing to to draw, [but] maybe publishers should think about what they’re comfortable with.”

Featured Post | Innovation | Perspectives

In a crowded streaming market, content alone will not ensure survival

April 18, 2019 Chris M. Sutcliffe – Independent Media Reporter

The cord-cutter’s dream of paying less for entertainment content is already on the rocks. Early analyst warnings about the reality of subscription saturation have filtered through to the mainstream, with a Mashable article titled ‘There are officially too many damn video streaming services’ reaching the front page of reddit. In it, Mashable’s Senior Tech Correspondent Raymond Wong argues that while Disney’s annual $69.99 fee is probably worth it for access to Disney’s vast stock of content from Marvel, Pixar, Fox etc., the arrival of yet another challenger to Netflix’s streaming dominance may ultimately be bad for the consumer.

“$14.99 for HBO, $10.99 for Showtime, $9.99 for Cinemax and $8.99 for Starz all feel expensive relative to Disney’s $6.99 price”
???https://t.co/6hBhzlGQfR
— Rich Greenfield (@RichBTIG) April 15, 2019

Between Netflix, Hulu, Disney+, Amazon Video, CBS All Access, the upcoming Apple TV+ and any number of other services, it’s easy to see why. Each has exclusive content across a wide variety of genres, so in theory each at least have one or two shows of interest to most audiences. It’s the ice cream stall dilemma on a larger scale: A huge amount of choice, but actually picking one feels more like denying yourself access to every other service.

How much is too much?

So, to get access to all those films and shows would require a number of subscriptions, the total cost of which will run into the hundreds of dollars per month. Small wonder that redditors pushed the Mashable article to the front page; the promise of cheaper, unbundled OTT entertainment is now in doubt. Subscription saturation is already here, and there will be casualties. Even Netflix has already borne the brunt of Disney’s entrance into the space, having lost as much as $8 billion off its market cap in the aftermath of the announcement.

To compound the problem, it’s highly unlikely that the number of streaming services has capped out. For media companies with huge back catalogues of film and television shows, it is far better to own the distribution system, audience data, and direct revenue. So, expect more efforts like The Criterion Channel to launch. Meanwhile, to differentiate themselves from the giants like Netflix and Amazon, smaller streaming platforms like Shudder are making a play for niche audiences clustered around a particular genre.

Hulu is embracing that fact that, with so much competition, people are probably going to jump around between video services. It’s just trying to keep them coming back to Hulu. https://t.co/cjAgrDuFtH
— Ashley Rodriguez (@AshleyRReports) April 16, 2019

Standalone value

However, while people are more habituated to pay for entertainment content than digital news, there is still a finite amount of subscription revenue out there. More than any consideration, the exclusive content available on a streaming service will be a deciding factor for audiences. That does not mean, however, that the broadest range of films and shows will necessarily win out.

The lure of a new show is what typically attracts subscribers to a streaming service in the first place. CBS All Access made the exclusivity of shows like Star Trek: Discovery the tentpole of its marketing. It even went so far as to commission some short episodes between the first and second seasons to convince subscribers who might have been tempted elsewhere to remain with them.

Similarly the announcement of Apple TV+ notably contained no information about pricing. However, it did showcase the triple-A nature of its commissioned shows and movies, with names like Steven Spielberg, J.J. Abrams, Oprah Winfrey, Jennifer Aniston, and Kumail Nanjiani already on board.

Originals approach

Netflix, wary of the media companies whose content is has licensed until now pulling their content, is also heavily investing in originals. It is reportedly spending $15 billion in 2019 on content, with a commensurate increase in its marketing budget so that everybody knows about it. Analysts expect a close to $3 billion marketing budget this year. It is obvious, then, that the range of content each platform has is currently seen as the differentiating factor for the bigger players in the space.

(This issue is muddied slightly by content considerations, with some US ‘exclusives’ being carried by competitors internationally as with Star Trek: Discovery appearing on Netflix elsewhere, and the requirement for streaming services to create a proportion of their content domestically when they enter a market like France.)

As mentioned earlier, however, there are some services that are making their niche nature the selling point to consumers, trading less mass-market appeal for a more targeted approach to exclusives. Horror-based service Shudder (owned and operated by AMC) has both negotiated the exclusive rights to certain horror movies and commissioned original content, while DC Comics’ VOD service (currently only available within the US) offers access to shows based around popular characters from the comics.

These services, with lower price points, are wisely trying to avoid the crush at the top by offering services that are additive to the larger services rather than in direct competition.

However, as the field becomes more crowded, it is unlikely that content alone will be the sole deciding factor for audiences looking to optimise their subscription spending.

Here, then are three criteria that might help determine which of the current services will be among those counted as ‘winners’:

User experience

Much has already been written about the discovery and recommendation options offered by Netflix, Amazon Video, and their ilk. Between the wealth of user data to which they have access and some smart people at the helm, those services have made user experience as smooth and effective as is possible. In April 2017, UX expert Justin Ramedia wrote:

“Netflix, through an easy-to-use interface, showed us how simple watching entertainment through the internet could be. They used strategic partnerships with Nintendo, Xbox, Roku, Amazon and more to ensure that people didn’t have to watch from their computers. Anyone could sit with their friends and family and stream thousands of hours of media whenever they liked. That genie won’t go back into the bottle.”

One of the criticisms that was most frequently levelled against The Criterion Channel’s defunct predecessor FilmStruck was that its UX was lacking. While in the UK, VOD services like the ITV Player and the BBC’s iPlayer are serviceable lack some of the recommendation tools that have been instrumental in making sure that users stay glued to Netflix even after the whole series has been binged.

The reality is that as newer entrants into the market begin offering exclusive content, they will inevitably be measured against the best in the environment. In order to succeed they’ll need to be as good or better to compete, as we’ll discuss later.

Platform availability

As Ramedia pointed out, Netflix made it a point to have a presence on each and every possible platform, from desktops to connected televisions to games consoles, including the shockingly poorly selling Wii U. Now, Disney appears to be following suit: Its announcement included a slide that showed each piece of tech hardware it intends the service to run on.

All the devices !!!!! #disneyplus pic.twitter.com/srdnc4D18z
— What’s On Disney Plus (@disneyplusnews) April 11, 2019

The point about existing across all these platforms isn’t that those streaming services believe they’ll necessarily get tons of sign-ups through those platforms or even because they exist on them. After all, the install base of the Nintendo Switch, while impressive for a relatively young console, is far smaller than the number of people who will sign up on desktop or connected TV. Instead, it is primarily in service of providing a holistic service to their subscribers, ensuring that they always have access to one particular streaming service on each and every device they own.

As with UX, the idea is to reduce any possible friction for a subscriber base, to ensure that no competitor gets a look-in or advantage from existing on a device that Disney+ does not. And as another plus for us Switch owners, it all but guarantees that Netflix will join Hulu on the console sooner rather than later.

Entrenchment

For many, Netflix’s early entrance into the market all but guarantees it success. It is the go-to comparison when we talk about rival streaming services, and its ubiquity has led to ‘Netflix-like’ comparisons for other digital services. Its entrenchment in the market is primarily due to the early mover advantage it has enjoyed, of which the service is keenly aware. As its competitors gear themselves up to compete in terms of content, Netflix appears to be digging itself in deeper by prioritising maintaining market share above profit. As Variety’s Todd Spangler reports:

“One reason Netflix is continuing to make big investments now is that it’s going to face serious new streaming competition from media giants Disney, WarnerMedia and NBCUniversal starting later this year. So it’s focusing on building out a wider moat instead of delivering profits, a strategy Wall Street continues to praise.”

That makes it an uphill struggle for any new entrant into the market. This is the case even for those without the deep pockets of Amazon, Apple or Disney who can gradually chip away at Netflix’s 139 million global subscribers through offering lower price points or a greater back catalogue.

Despite the ongoing success of the larger streaming services, growing consumer dissatisfaction with the total cost of subscriptions and a soft cap on the amount people can afford to pay means competition is only going to get fiercer over the next few years. And as the dismal performance of YouTube Red (now Premium) demonstrates, investment in original content alone is unlikely to be the sole differentiating factor. Instead, a combination of the other three criteria and harder to measure qualities including audience affinity with a brand are likely to be the determining factor for success in the streaming world.