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Industry-Research | Perspectives

Consumers expect brands to pressure social media companies to clean up their act

Today’s consumers expect brands to navigate the social media landscape more responsibly. A new Edelman Trust Barometer study shows that consumers across nine countries expect brands and marketers to think about content and context and to boycott certain environments when purchasing media. Consumers are aware of the influence advertisers have in the marketplace, given their impact on revenue. Edelman’s research shows that people lack confidence in social media and look to brands to leverage their influence to act on social media problems such as fake news and data integrity

Environment clearly matters, and brands are accountable for their choices. Nearly half of all consumers globally agree it is a brand’s own fault if its advertising appears next to hate speech. They also feel that the points of view that near a brand’s advertising and marketing messages are an indication of that brand’s values and what it stands for.

Additional findings from Edelman ‘s review of social media in 9 countries includes:

  • Only 40% (34% in the U.S.) trust that social media platforms will address fake news and hate speech.
  • 60% (61% in the U.S.) report that they do not trust social media platforms to behave responsibly with user data.
  • 40% (38% in the U.S) say they have deleted at least one social media account in the past year because they did not trust the platform to treat personal information properly.
  • Nearly two-thirds (62% and 48% in the U.S.) said that they want government to play a stronger role in regulating social media.

Importantly, consumers want brands to apply pressure on social platforms to protect them from inappropriate use of content and misuse of personal data. Nearly seventy percent of consumrs agree that brands should pressure social media to do more about false information and fake news and protect users from offensive/harmful content and to ensure personal data is protected and used ethically.

Consumers are demanding transparency and privacy protection from social platforms. However, they have little trust in them to fix these problems. And they clearly value the efforts that brands make to influence these issues. This represents an important time and opportunity for brand marketers to step in, act and enforce on behalf of the consumer. This with help rebuild trust in the media marketplace as well as in the brands that do so.

Perspectives

Algorithmic angst: News Corp Chief Executive Robert Thomson’s “Breaking The News” keynote

News Corp Chief Executive Robert Thomson delivered a keynote presentation at “Breaking the News: Free Speech and Democracy in the Age of Platform Monopoly,” an all-day conference hosted by the Open Markets Institute and the Tow Center at the Columbia University School of Journalism on June 12, 2018. Speakers explored how the power and business models of large online and telecom intermediaries affect the ability of reporters and editors to gather and distribute news in the 21st century.

Below is the full text of the talk he delivered:

FREE SPEECH & DEMOCRACY IN THE AGE OF PLATFORM MONOPOLY

I guess that I am the amuse bouche ahead of your hearty lunch and Mark Thompson.  We’re not related. The title of this ornery oratory, for some, what will be a difficult-to-digest diatribe is – when Irresistibility becomes Irresponsibility. It’s a theme familiar to Big Tobacco and, perhaps, in our time, to Big Digital. A possible subtitle is The Line of Least Compliance.

The subject of subtitles reminds me inevitably of film, and I do want to call out one film buff whose good taste in cinema is only exceeded by her zeal in trying to right Digital wrongs, and that would be European Commissioner Margrethe Vestager, herself reputedly the inspiration for a Danish political drama. Commissioner Vestager delivered a speech two weeks ago that is worthy of close scrutiny by all here, and certainly so by any company subject to her tender mercies. Most importantly, she referenced the original Blade Runner, and its poignant portrayal of loss and love and meaning and, particularly, the telling line used “like tears in rain”. I was intrigued and so we had an exchange, obviously not about pending cases, but about the inherent irony in Blade Runner, the irony being that it is the automatons, the replicants, who most cherish the essential human values, family, friends, loyalty, shared experiences, shared memories.

If journalism were a film, the last decade is certainly the equivalent of a slasher movie – the Silicon Valley Chainsaw Massacre – and there have been many tears shed in the rain.  So when we contemplate a robust commercial future for journalism and for professional media, we must first ponder an eco-system that has punished the creators and profited disproportionately the distributors, who are indeed publishers but cannot quite pronounce the word “pu…pu..publisher.”  It gets a little harder for YouTube not to admit to being a broadcaster when it spends many millions advertising its $40-a-month television package and surely even Facebook will concede that it is a broadcaster and publisher now that the company has bought English football rights in Asia and surfing rights globally.

Unfortunately, the current content ecosystem is fertile territory for the fabricators of the fabulous, as you can tell, I like alliteration, and the furnishers of the fake and the faux. I’ve been holding forth on, some would say ranting about, this vexed topic for a decade or more.

I was recently reminded by Nick Thompson of a UK House of Lords testimony in 2007 in which I warned that the internet was ripe for exploitation by bad actors who could take advantage of the large digital platforms to disseminate drivel. Being questioned by those august peers in 2007, I suggested:

“What you have is a lot of young people who are growing up surrounded by much more information but whose provenance is not clear.  In the longer term critical judgment will not be as it should be.  The rumors will be believed, the fiction will be thought of as fact and the political agendas, among other agendas, will be influenced by interest groups who are coming from some quite strange trajectory to issues based on collective understanding that is founded on falsity.”

Now that was not eerie prescience, so don’t come to me for advice on stock investments or racing tips or an NCAA bracket, or today’s Time Warner ruling, but it was really just the judgment of a journalist – at that time the editor of The Times of London – who had spent every working day since the ridiculously raw age of seventeen trying to assess the veracity and authenticity of information in a newsroom. It was clear back then that the internet had inherent vulnerabilities and that the digital platforms had a responsibility to project professional journalism and cultivate a culture of compliance so that the real could be separated from the unreal and the surreal.

If your business model is to commodify content – which is an egregious mistake because there is a hierarchy of content – and then allow a search engine or social platform to be easily manipulated by bad actors, then you’re failing a basic test of compliance.  Basic compliance should have been the modest price of admission for the big digital players.  And these are very profitable players – Facebook’s operating margin last year was around 48 percent. And yet almost daily we hear of issues in compliance seems to be an awkward afterthought – that is because we are indeed in a new era, an era in which the pervasiveness of the largest digital platforms makes Standard Oil look like a corner gas station. And so naturally there are comparisons already being made between Big Tobacco and Big Digital – if Big Digital wants to avoid the fate of Big Tobacco, it needs to take the initiative rather than being reactive.

So here we are in 2018, where sense and nonsense rub shoulders on platforms, where the artificial and the asinine thrive, and where the click-bait cultivators and search engine spivs reap bountiful harvests, and where professional journalism still faces an existential crisis in many countries. Now I could fulminate furiously on this subject ad infinitum and occasionally ad hominem. But I would like to highlight one issue, which is very relevant to today’s question about the future of new economic models for journalism – it is what I like to term algorithmic angst…

But, before the tirade, a moment of reflection. Media must also tend to its reputation. Our reporters have to create compelling content and be seen to have the objective of being objective. That is particularly the case in an age of bluster and bombast.

 

Our journalists have to be renaissance reporters – willing to traverse platforms to ensure that the story is told where people are reading or listening or watching. And journalists should be wary of being too self-referential or self-reverential…journalism is about society, not about self.

Enough about people and their foibles and their follies, let’s focus on something far more important, the machines and the software that is their soul. Algorithms are awesomely powerful, and they are destined to become far more so.  The compounding impact of AI will mean that they will know much more about us and we will know much less about them.  Their ability to create a growing audience of addicts will be enhanced and the young will be the most targeted and the most vulnerable, as they are already.  Social platforms obviously do much good, but they can also be antisocial and idealism cannot be used as an excuse for deleterious behavior.  Facebook has long believed that “connecting” people absolved it from other, “secondary” responsibilities.  Google has long held that “informing” people is the greater good and that any negative consequences are a small price to pay. I make something of a distinction between Google, which is making an effort to reform, and YouTube, which must do far more to purge piracy and extreme extremism.

The modern metric that drives digital platforms is “engagement” – it is fair to say that Big Tobacco was also focused on “engagement”, but commercial priority can have a social cost. It is clear, for example, that young people are not just distracted by acts of reading or responding to posts or tweets or photos, to likes and dislikes, to friending or unfriending, to status updates that undermine a person’s status.  The truth is that they are deeply distracted by and sometimes seriously distressed by the thought of, the anticipation of reading or responding.  When the intention of a powerful algorithm is to increase so called “engagement,” what is the potential for a vulnerable person to be disengaged from society?

It is well-documented that radical groups, whether Islamic extremists or fascists, successfully groom and radicalize young people on the web. These are the obvious outcomes of obsession. What about the less obvious damage done to the psyche and to the self-esteem of the young? And that would include damage done to the ability to concentrate and to tolerate.

And yet there has been no serious movement to hold these omnipotent algorithms to account, which is why I think there should be an Algorithm Review Board to get more accountability and transparency from the three overwhelmingly dominant algorithms of our day: Facebook, Google/YouTube and Amazon. If you buy a small bar of chocolate in the US, you’ll be told the precise ingredients on the pack and generally how many calories per serving. There will be stark health warnings on even a low alcohol bottle of beer.  Clothing labels are often synthetic screeds, in multiple languages, to ensure compliance.  And yet the powerful, mind-altering, behavior-shifting, mood-changing algorithms are allowed to work their invisible alchemy on our personalities, on our societies and on our young people.

So what should an Algorithm Review Board, an ARB look like? Call it an Algorithm Transparency Board, if you like or, if you must, an Algorithm Altruism Board. It’s obviously important that experts in the related fields preside, not politicians, and that which should be confidential is kept confidential, but that which should change is changed.

There are a few basic categories into which an expert industry panel can provide insight and protection for the vulnerable. These priorities would include invasions of privacy, which are already commonplace, IP piracy, which is rife, news censorship, which is clearly already underway, and commercial abuse by dominant players, which is both real and difficult to monitor. There would also be a role during election campaigns to ensure that the sanctity of the system is not violated by bad actors. A further crucial area is the socio-psychological impact, particularly on children – essentially we have the world’s cleverest engineers and the world’s cleverest machines finding ways to make programs irresistible – the net as nicotine and technological tar.

In the midst of the modern morass, Facebook has made a contribution by highlighting the importance of “trusted publishers”, but who is to judge trustworthiness. The very citing of  “trusted publishers” reinforces the rightness of Facebook paying premium publishers and premium journalists for the reputational and experiential services they provide.

And Google, which has actually become more responsive under Sundar Pichai, has been tweaking its algorithm in ways that seem to be a mystery to even the company itself.  At the end of the prejudicial “first click free” – which we certainly applaud, as it punished professional journalism – there were extremely odd traffic patterns across our sites.

One week in February, we saw a sudden and remarkable surge in Google referrals to WSJ.com, the Wall Street Journal’s website. This erratic movement followed months of relative inactivity, so our CTO asked Google what had happened and was told that it was a “bug” in the algorithm.  Now we’re certainly in favor of more referrals, but it is extraordinary that the algorithm was so anarchic.  And BuzzFeed reported last month that a change in the Google News algorithm led to a bizarre dominance, in a supposedly eclectic broad feed, by the BBC.  Every one of the top 50 results to a search was a BBC news article and 97 of the top 100 came from the UK broadcaster – that’s a little like the North Korean election result. Again, no coherent explanation, just an admission that the results were bizarre and unintended.

And Amazon can punish or reward companies with a tweak or a turn or a twist in its algorithm as they did so brutally a couple of years ago with Hachette – now there is a story for the Washington Post….In the US, Amazon has over 95% of the audio book market, and doubles as a publisher of books itself.  In the language of an antitrust expert in Brussels, they dominate a horizontal and are thus able to influence a vertical containing their own products. Such dominance is clearly in need of close scrutiny and that scrutiny can only come from a rigorous assessment of its algorithm.

So, in conclusion, there is obviously a need for an Algorithm Review Board to track the intended and the unintended psychological and social and commercial and political impact of pervasive platforms. If the imperative of an algorithm is to be irresistible, when does irresistibility become irresponsibility?

New York Times CEO Mark Thompson also delivered a keynote presentation at “Breaking the News: Free Speech and Democracy in the Age of Platform Monopoly” event. Click here to read it. 

Perspectives

Fight for the future: New York Times CEO Mark Thompson’s “Breaking The News” keynote

New York Times CEO Mark Thompson delivered a keynote presentation at “Breaking the News: Free Speech and Democracy in the Age of Platform Monopoly,” an all-day conference hosted by the Open Markets Institute and the Tow Center at the Columbia University School of Journalism on June 12, 2018. Speakers explored how the power and business models of large online and telecom intermediaries affect the ability of reporters and editors to gather and distribute news in the 21st century.

Below is the full text of the talk he delivered:

JOURNALISM, FREE SPEECH AND THE SEARCH AND SOCIAL GIANTS

These are troubling days for journalism. Even the primacy of fact and well-sourced, objective reporting over delusion and propaganda is under assault.

A concert party of Russia and other repressive regimes, populists and extremists, assorted trolls and bots, not to mention the 45th President of the United States, are doing their best to convince the world of what George Orwell in Nineteen Eighty-Four called “blackwhite”: that dispassionate, accurate journalism is “fake news”, and conspiracy-theories, gross exaggeration and outright lies the real thing.

Their aim is to level reality with their own “alternative facts” and, by this process of levelling, to rob serious journalism of its civic impact and value. They don’t have to be believed to succeed; they merely need to sow enough doubt in enough minds that a large slice of the population no longer knows who to trust.

Some of the conventions which protect the ability of real journalists to report real news are also being flouted. Last week we learned that, as part of a leak inquiry, the FBI had seized years’ worth of emails and phone records belonging to New York Times reporter Ali Watkins.

This may be standard operating procedure in controlled societies. In this country, it breaches established precedent, is manifestly against the spirit of the First Amendment, and has been rightly condemned by the Committee to Protect Journalists as a “fundamental threat to press freedom”.

But these threats can be seen off. The fake-newsers may have convinced some people that up is down for now. Sooner or later brute reality and common sense will settle the argument in favour of the facts.

As for the state and press freedom: the safeguard enshrined in the Bill of Rights, and the tradition of self-restraint by the authorities when free speech is at stake, should prevail – at least if citizens speak out, and Congress and the courts do their job.

But the most serious threat facing journalism – the disruption of the traditional business model for journalism, and the failure of all but a handful of titles across the western world to find credible digital alternatives – is much more intractable.

It presents as an economic problem but its consequences, which are already playing out and, unless something changes, are likely to grow far worse over the coming years, are civic and political.

Democracies cannot remain healthy if citizens do not know what is happening in their communities. If public and private institutions are not held to account. If elections come and go without issues being aired and candidates being scrutinized.

Unfortunately, at present the local, regional and national professional journalism, which historically played such an important role in meeting these civic needs, is ailing – in some cities and regions dying – in much of America and the West.

There are exceptions, and The New York Times is one of them. We have national scale and international potential. We realised in time that high quality journalism, a deep relationship with our most engaged readers, and an effective digital subscription model offered a far more promising path to the future than digital advertising alone.

Today we have more digital news subscribers than any other news organization in the world – and, at getting on four million, twice as many total subscriber-relationships as at the peak of print twenty-five years ago. Our revenue and operating profit have been growing, not “failing”, whatever a little bird may have told you.

Most importantly, we have a newsroom and editorial department which – at some 1,450 strong – are bigger and more formidable than they were ten and twenty years ago.

For me, that’s less the result of our digital success than the single most important reason for it: The Times responded to digital disruption, not by disinvesting in high quality news and opinion, but by doubling down on them. And as we’ve found – whatever cultural pessimists may say – a growing number of people here and around the world are willing to pay for it.

But we have advantages that most news providers do not enjoy. And, even with those advantages, we find the environment for growing our digital revenue – and securing the funding of our newsroom – harder than I believe we should.

So to what extent are the major digital platforms – Google, Facebook, Apple and the others – part of the problem? And, if they are, what could they, we, and the world’s policy-makers and regulators do to put things right?

Two caveats first. One: there’s no point blaming individual digital companies, no matter how big, for the fundamental attributes of the internet, or for the decline and fall of the cosy print-advertising based business model that supported journalism for so long. Neither are their fault and, in any event, there’s no way of putting the clock back.

Two: I want to proceed with a presumption of good faith on the part of the major platforms. Like many media executives, I’ve spent time with the leaders of Google, Facebook and Apple and I’ve seen no evidence that they want to destroy journalism, or are unaware of the crisis in the economics of news, or unwilling to explore ways of improving the eco-system.

Google, in particular, has taken a series of tangible steps to help news organizations build digital subscriptions, for instance allowing publishers to deploy their subscription business rules on the Google platform rather than imposing Google’s own rules on them.

Facebook has to date been less responsive, focusing largely on its own ideas rather than developing solutions jointly with publishers. Here too, though, there has at least been a willingness to listen.

However, major unresolved issues remain. We can put them under four broad headings:

Opacity – we do not know, beyond inevitably imperfect and incomplete empirical observation, how the algorithms of the major platforms sort and prioritize our content, nor can we reliably predict or influence changes in those algorithms, nor in any sense hold the companies to account for them;

Impoverishment of the news experience – to appreciate and critique news sources over time, and to decide which to trust, users need to develop sophisticated relationships with news brands and individual reporters and opinion writers, but the platforms encourage atomized consumption of single stories and the jumbling of stories of different depth and quality from different sources, and they strip away essential signals – news or opinion, for instance, lead story or minor footnote – about editorial intentionality;

Inequitable economics – although the platforms undoubtedly help publishers reach new audiences, most publishers believe that the current division of the economic benefit of the presence of news content on the platforms unfairly favours the platforms; and finally

Independence and plurality of editorial decision-making – this is the least-discussed issue; it is that open societies require multiple independent points of editorial control, which can compete and hold each other to account, and between which the public can choose; but that the major platforms may decide, or feel pressured, to replace this plurality with single points of essentially algorithmic editorial control.

These four categories are not mutually exclusive, but mutually reinforcing: the relative poverty of the news experience on the platforms makes it harder for publishers to monetize it; the opacity of the operation of the search and social algorithms increases the risk of a loss of plurality in editorial decision-making; and of course business model failure because of the inferior economics of the platforms will have its own impact on plurality.

Most people assume that publishers only care about the disappointing revenue they derive from their presence on the platforms. My view is that all four headings are important, and not just to publishers but to society at large.

Let me offer you a few responses to these concerns. First, full transparency about both algorithmic and human editorial selection by the major digital platforms is an essential preliminary if we are address any of these issues. It would be best if this were done voluntarily, but even if it requires regulation or legislation, it must be done – and done promptly.

As a second preliminary, the major platforms must engage with the collective industry bodies of the news business to arrive at shared principles both on the presentation and choice of news content, and on its monetization. The stakes – and the need for consistency and comparability in the treatment of news providers – mean that, though the present informal bilateral relationships between, say, The Times and Google, or The Washington Post and Facebook, should no doubt continue, they are not enough.

Third, we need to do more to restore the labels and design cues that help users make sense of news in a physical newspaper, or on a TV screen, or even on a traditional web-page, but which are stripped out in smartphone newsfeeds and search results. Without sufficient signposts, no wonder users confuse news and opinion and other significant editorial nuances.

Fourth, regulators, both here and in Europe and other jurisdictions, should examine how well these markets are functioning. In economic terms, news provision on the major platforms consists of two barters: consumers exchange their attention and personal data for the services provided by the platform; while publishers offer the platforms valuable content in exchange for distribution, audience leads advertising opportunities.

It is sometimes argued that, because the major platforms do not charge consumers money for their services, the public cannot suffer exploitative pricing. But barter implies an exchange of goods or services of real and quantifiable value in which a party can get a better or worse deal. If scale and network effects allow a search or social platform to achieve market dominance, a consumer who feels that they must use the platform may find themselves exchanging their attention and data for less in return by way of services than they would if there were effective competition. The same goes for a publisher who may conclude that they have no choice but to offer their content to a platform despite the poor economics.

In other words, a market based on barter can experience market dominance, market failure and market abuse. I don’t want to jump to the conclusion that such abuse is occurring, but these markets deserve close technical scrutiny and may require competition remedies.

Lastly, the topic of independence and plurality of editorial decision-making. We face an immediate threat here: which is that Facebook’s catalogue of missteps with data and extreme and hateful content will lead it into a naïve attempt to set itself up as the digital world’s editor-in-chief, prioritizing and presumably downgrading and rejecting content on a survey- and data-driven assessment of whether the provider of the content is “broadly trusted” or not.

Now you might expect The New York Times to favour such a scheme. Indeed Mark Zuckerberg, whose idea this seems to be, told us The Times should expect to do well in such a ranking.

In fact, we regard the concept of “broadly trusted” as a sinister one, which misunderstands the role journalism plays in an open society and is likely to lead to damage and distort, not just the news business, but democratic debate. Democracy depends in part on unbounded competition between different journalistic perspectives and the clash of different judgements and opinions. History suggests that mainstream news organizations frequently get it right, but also that, not infrequently, it is the outliers who should be listened to. At any given moment – think of mainstream media today in Russia, or in continental Europe in the 20s and 30s – a majority of the public may judge trustworthiness incorrectly.

To feed transient majority sentiment about trust back into the editorial decision-making process – and to do it essentially behind closed doors – is profoundly dangerous. The process of citizens making up their own mind which news source to believe is messy, and can indeed lead to “fake news”, but to rob them of that ability, and to replace the straightforward accountability of editors and publishers for the news they produce with a centralised trust algorithm will not make democracy healthier but damage it further.

The depth of Facebook’s lack of understanding of the nature and civic purpose of news was recently revealed by their proposal – somewhat modified after representations from the news industry – to categorize and label journalism used for marketing purposes by publishers as political advocacy, given that both contained political content. This is like arguing that an article about pornography in The New York Times is the same as pornography. Facebook admitted to us that their practical problem was that they were under immense public pressure to label political advocacy, but that their algorithm was unable to tell the difference between advocacy and journalism. This would be the same algorithm which will soon be given the new task of telling the world which news to trust.

When it comes to news, Facebook still doesn’t get it. In its efforts to clear up one bad mess, it seems set on joining those who want blur the line between reality-based journalism and propaganda. But the underlying danger – of the agency of editors and public alike being usurped by centralised algorithmic control – is present with every digital platform where we do not fully understand how the processes of editorial selection and prioritization take place. Which right now means all of them. Thus the urgent need for transparency.

The internet could still fulfill its promise as the enabler of more-informed, more-empowered democracies. But it won’t get there on its own. And nor will the major digital platforms. Thank you.

News Corp Chief Executive Robert Thomson also delivered a keynote presentation at “Breaking the News: Free Speech and Democracy in the Age of Platform Monopoly” event. Click here to read it. 

Advertising | Featured Post | Perspectives

Facebook’s political ad disclosures are a train wreck in progress

As the midterm elections ramp up — and the foreign interference from Russian operatives during the 2016 election continues to haunt pseople — Google, Facebook and Twitter have all announced more stringent rules around online ad disclosures. And the Federal Election Commission too is seeking public input on a proposal that would expand political ad disclosure rules for other media to mobile apps.

So far, though, the disclosure rules at Facebook are not just a work in progress, but more of a train wreck in progress, as flaws with Facebook’s new rules are already emerging. The social giant was supposed to archive all political ads publicly but missed some, and critics have complained that they aren’t giving enough information about how the ads are targeted. And so many publishers are getting caught up in the rules and can’t boost their own political stories on Facebook without jumping through hoops. An effort by the News Media Alliance to get publishers whitelisted has started, but so far Facebook doesn’t have plans to do that.

It’s clear that more overarching, consistent rules across social media and the web — not just from Facebook and other tech giants — are needed to monitor political ads on the internet.

Facebook’s New Rules – And More Hiccups

In May, Facebook launched its ad transparency tool in the U.S., which requires ad purchasers on Facebook and Instagram to reveal and verify their identities and locations. Upon verification, those ads — whether for candidates or political issues — must come with a “paid for by” label disclosing who paid for the ad. Anyone on Facebook can now also search for any of these ads for up to seven years in an online database the company set up.

Almost immediately, the new rules caused hiccups. In California, at least one progressive group was able to continue targeting local voters with negative campaign ads about a candidate without disclosing who was behind the campaign. In Florida, ads for more than a dozen political candidates and organizations — which had cleared previous disclaimer requirements — were shut down because they didn’t reveal who paid for them. This resulted in a loss of thousands of dollars for campaigners already in full election swing mode. Facebook’s new tool also saw an article’s link to a Breitbart piece as a red flag. The article was immediately shut down — even though linking to Breitbart was actually part of a broader initiative to correct partisan propaganda, not spread it.

Meanwhile, the Florida Department of Highway Safety and Motor Vehicles had its safety ads caught up in the terms of the new rules, even though it’s running public service announcements. And certain loopholes allow one person to go through Facebook’s verification process and then give the reins for an account to someone else.

What’s more, Facebook needs to negotiate with unique local transparency laws at the same time it’s trying to implement these rules nationwide and eventually globally. Failure to do so means the social giant is actually violating local laws with these new ad disclosures — which is precisely what’s happening now in Seattle and Washington state, which is now suing Facebook and Google for violating those laws.

Do the Rules Go Far Enough?

While there are obvious problems out of the gate, there are also some important missing elements to Facebook’s rules.

Facebook’s new database is missing ads it should obviously catch, as ProPublica’s Jeremy Merrill, Ariana Tobin and Madeleine Varner have reported. But more strikingly, Facebook is also not revealing a critical piece of information that’s been a contentious force in past advertising: how the ads are being targeted. ProPublica previously found, for example, that certain housing ads on Facebook were made to exclude African Americans and other “multicultural affinities” from seeing them, which violates Fair Housing Act protections.

In response, ProPublica is building an independent database of political ads to monitor Facebook’s efforts.

Publishers Struggle

While certain roadblocks are to be expected in the process of setting things up, publishers have to be especially alert to Facebook’s new rules. The definition of “ads with political content” is “astonishingly broad and may affect any promoted content that relates even vaguely to the political system,”  said Ned Berke, program director of audience development at the Center for Cooperative Media at Montclair State University.

Here are some particular points publishers should keep in mind to avoid scuffles, according to Berke:

  • get authorized;
  • bookmark the 20 issues of public importance Facebook has outlined;
  • modify ads that started running before May 24 — before Facebook’s new terms launched — so they have the required disclaimers;
  • watch out for the keywords that could trigger Facebook’s machine-learning classifier.

Many angry smaller publishers have decided not to boost posts or run Facebook ads until the social giant makes it easier for them to get verified or starts a whitelisting regime so they can promote their journalism covering politics.

Self-Regulation?

While the FEC is currently waiting on public comment for its proposal of new disclaimer rules for online political ads, the Digital Advertising Alliance is advocating for more self-regulation that could potentially work in conjunction with the FEC’s proposal. The DAA hopes to create new “Political Ad” icons that would link back to sites disclosing the identity and contact information of advertisers. It would be comparable to the DAA’s AdChoices, an icon that informs consumers of tracking data and gives them the option of opting out of behaviorally targeted ads.

Like the FEC’s proposal, it’s unlikely the DAA’s suggested political ad icon could come out in time for this year’s midterm elections. But the broader point is that we need more compliances on a federal and organizational level aside from just companies making their own rules for their platforms. The Honest Ads Act, which would bring online advertising disclosures on par with television ads, is another push in this direction, though the bill hasn’t gone far in the current Congress.

The Good, The Bad, The Hopeful

Facebook knows it may not catch all ads and has welcomed feedback on actors that appear to be trying to game the system. It’s also stated that political ads will be subject to human review on top of the machine-learning classifiers. The company is also in talks with groups, including news publishers, about how the authorizing, labeling and archiving of political content will affect them. However, the specifics for how publishers can avoid being bogged down in disclosures that may affect their online presence have yet to be announced.

Still, the ad tool and the database are currently confined to the U.S. And in countries like Sri Lanka, Facebook has already proved to be the gasoline that ignites political wars on social media. While the company maintains it’s committed to expanding these initiatives internationally, there’s still a long way to go. While the hope is that things will improve over time, Facebook needs to tread with care and get this balancing act right to make sure trusted publishers can promote their important political coverage. Let’s also hope oversight from independent groups and government regulators comes through as well.

Advertising | Perspectives

Trends at the NewFronts: brand safety, metrics, big media ‘coopetition’ with platforms

The NewFronts are far from new. And old-line publishers are making more noise this year, even as the event is shortened to one week from two, with another week coming in the fall in Los Angeles. This week, the discussion between publishers and advertisers around online video had the usual buzzwords and focus on youth, mobile, and fun. However, challenges remain relating to brand safety, metrics, and building awareness of publishers’ digital video offerings.

As digital video ad revenue in the U.S. continues to grow — predicted to hit $15.42 billion this year and reach $22.18 billion in 2021 — according to eMarketer, more publishers and tech platforms will battle it out for those ad dollars even as popular video destinations like Netflix and HBO lack ads. And with so many publishers and platforms working together, it’s become more of a “coopetition” among them at the NewFronts.

Here’s a roundup of some of the key NewFronts trends to watch.

Brand Safety Concerns Continue

Last year’s NewFronts said it all: Whether this dog-and-pony show is worth it highly depends on how much money you have, and what you have to offer. Similar to last year, for most publishers, what they want to offer — and therefore what is at the forefront of their minds — is brand safety.

As YouTube continues to battle crisis after crisis on its platform, brands are under pressure to make sure their content doesn’t appear next to extremist or racist propaganda. Other platforms hardly match YouTube’s scale, making it hard for advertisers to boycott YouTube for any length of time.

Whereas some companies might feel anxiety, others see opportunity. Take NBCUniversal. The company isn’t hosting a NewFront presentation but is still pitching a new way of buying short-form video — NBCU Choice — that it’s guaranteeing to be brand safe and effective at hyper-targeting. And Digiday reports that half of that inventory is on YouTube.

“With the widely reported issues around questionable adjacencies and toxic environments, this has only become more important,” Hearst Magazines Digital Media’s Todd Haskell told Digiday. “We speak to issues around brand safety in every pitch, but particularly in ambitious content marketing programs like this.”

For YouTube itself, the tech giant has revealed a slew of changes to bolster its services. In yet another effort to quell brand safety fears, Google has announced it will improve the quality of ad-supported content on Google Preferred, YouTube’s program to allow advertisers to place their advertising on the most popular 5% of YouTube channels. The tech giant will now add inventory from YouTube TV — its streaming service that packages popular TV channels — to Google Preferred. Noting that audiences are also watching YouTube on TV screens more — 150 million hours a day, by its accounts — Google has also announced advertisers can buy YouTube video ads meant to only stream on TV screens through AdWords and DoubleClick Bid Manager.

These changes may not be enough to make publishers forget how precarious their content is online — but it’s certainly enough to keep publishers and advertisers hooked on Google.

The Metrics and Awareness Challenge

The convergence of video and TV means that brands this year are also paying more attention to metrics. Nothing comparable to Nielsen ratings has yet to exist for digital. As such, publishers that define success with their own metrics can lead to the kind of inflation and misinformation that has gotten some of them in trouble in the first place.

“With regard to the NewFront, one of the things that has come up historically has been almost an abstract discussion of data,” Zenith Media digital investment EVP Will Warren told BeetTV.

“I think what needs to come into play is, ‘How are publishers themselves using those types of information that they own specifically to help drive their own business forward?’”

Beyond the typical vanity metrics, Meredith exec Andrew Snyder mentioned how important measuring impact is for the publisher, which swallowed up Time Inc. recently.

“We are really focused on driving impact,” Snyder told Broadcasting & Cable. “We think about impact in two ways. On one side, it’s about impact with consumers. On the advertising side of the house, what matters most to our customers is scale, and together the new Meredith reaches over 170 million consumers. We reach 80% of millennial women.”

But what really puts some traditional broadcast and print publishers behind the eight ball is the fact that audiences don’t think about them as purveyors of original online video content. According to the 2018 Digital Content NewFronts Sentiment Forecast, commissioned by Matrix Solutions, consumer interest in original content from big media names like ESPN and the New York Times is pretty abysmal. While Americans who watched online content were excited about YouTube (57%) and Hulu (32%), only 16% were excited about ESPN, 10% about New York Times, and 2% about Conde Nast.

Big Media ‘Coopetition’ with Platforms

That problem around awareness might explain why some larger media brands like ESPN and Viacom presented for the first time at the NewFronts this week. Both companies are pushing very big digital initiatives. But they have a long way to go to catch up to established players.

Disney had been content in the past to tout its Maker Studios at NewFronts in the past, but this year is breaking out with its Disney Digital Network, using the “brand safe” buzzword throughout its presentation. The company touted new food shows via Tastemade and a “Star Wars” fan event. Disney even had ESPN present in its own slot, pushing its new ESPN+ streaming service, as well as new original content deals with Facebook, Twitter and Snapchat.

And Viacom was touting its new 300-person division, Viacom Digital Studios, with hundreds of hours of original digital-native content, along with expanded programming for Snapchat. Plus, Viacom will produce the first VidCon conference in London in February 2019.

While many larger publishers have had love/hate relationships with the tech platforms, it’s interesting just how much love there has been at the NewFronts. Twitter announced even more live video programming with publisher partners, and nearly every publisher mentioning programming on tech platforms.

For marketers, it’s not an either/or proposition between the platforms and publishers, but how to spread the word in brand-safe content, with measurable results to the right audience. How they get there isn’t as important as the fact that they can get there.

DCN-Research | Revenue

Publishers continue to invest in platforms, but research confirms that platforms give little in return

Digital Content Next (DCN) recently released findings from its second annual DCN Distributed Content Revenue Benchmark Report. The research, written about here and here,  provides marketplace intelligence on distributed content strategies and the challenges confronting publishers when working with third-party platforms like Facebook, Twitter, Snapchat, YouTube, and others. The report confirms that despite the constant changes in distributed content policies and business practices, little has changed for publishers in the last 12 months.

Facebook and Google generate the most distributed-content revenue for publishers outside of Over-the-Top (OTT). However, together they account for less than 30% of the total distributed content revenue and represent only 5% of the total average digital revenue for publishers. Overall revenues from distributed content grew from 14% in last year’s report and now represent 16% of the surveyed publishers’ digital revenues.

Additional Key Findings

  • Monetization of distributed content for H2 2016 and H1 2017 represented an estimated $10.1 million and $10 million average revenue. For companies providing data for both H1 2016 (last year’s report) and H1 2017 for this report, distributed content revenue grew by an estimated 37% year-over-year.
  • Video, consistent with last year, represents 85% of the total, $8.3 million in 1H 2017, driven by TV/cable companies’ OTT monetization. The remaining 15% cuts across social media, Google AMP and syndication.
  • Facebook generated the most revenue for publishers, capturing $1.3 million (50% of social platform revenue) in H2 2016 and $1.5 million (59% of social platform revenue) in H1 2017.
  • Out of the specific third-party platforms tracked, publishers are active on Facebook, Twitter, YouTube and Instagram. However, for monetization purposes, publishers are still most active on Facebook and YouTube.

Despite the challenges, DCN found that publishers remain active across a range of channels distributing and monetizing content off their sites at levels relatively consistent with last year’s findings. Still, publishers remain cautious about increasing staffing for distributed content monetization.

Best Practices

1. Concentrate negotiation at the executive level of your company management; do not leave negotiations to lower-level management and/or individual brands or businesses.

2. Focus on products that leverage your core business, are replicable, get new money, and have the potential to scale.

3. Negotiate for business requirements that support scaling in partnership agreements:

  • ad server integration;
  • third-party measurement integration;
  • management reports (e.g. roll-ups by publisher and/or marketer);
  • and-data for advertising and subscription monetization.

4. Test and measure content consumption and monetization through both advertising and subscription on third-party platforms and compare results to on-site metrics to inform monetization strategies.

5. Centralize responsibilities or use active cross-functional teams for managing third-party partnerships.

Advertising is the most common form of monetization of content distributed on third-party platforms, with more than 85% of total average revenue sold directly by publishers. While distributed content remains an essential part of publishers’ strategic plans, the revenues earned do not match publishers’ investment. Importantly, publishers will continue to participate and test to find the best value and revenue model for their premium content.

Industry-Research

Publishers will diversify, platforms will tackle TV, and more media predictions for 2018

Nearly half of all editors, CEOs, and digital leaders (44%) are even more concerned with the powerful role of social media than they were a year ago, reports Reuters’ Journalism, Media & Technology: Trends & Predictions 2018. Publishers note their disappointment with social platforms, particularly with Facebook because of the platform’s role in the circulation of fake news, the lack of promised video revenue, and the decline in referral traffic to many news websites. As a result, publishers plan to be less dependent on social platforms. As one executive summarizes, “Expect more news organizations to pull out of deals with Facebook, Apple, and Snapchat that they consider are not delivering sufficient financial return, focusing instead on building more direct readership.”

Predictions for Publishers:

Restore consumer trust in journalism

Publishers are continuing to strengthen consumer trusts in news brands. Unfortunately, too often quality journalism is posted side-by side with low quality content and misleading information. Most social platforms fail to distinguish between the two. In 2018, publishers will continue to pressure social platform companies to set standards and do more to differentiate brand news content.

Less reliance on advertising

Publishes are working to diversify their revenues to ensure less dependence on advertising sales. In fact, 62% of publishers say that advertising will become less important over time. Publishers need to shift their strategies from reach and advertising engagement to subscription models and tenure.

Improve data capacity

Publishers believe that data is important to their business needs. Nearly two-thirds of publishers (62%) report that improving data capacity is their most important initiative this year. It’s also imperative for publishers to understand and comply with the European General Data Protection Regulation (GDPR) starting this May. The GDPR requires that publishers ask users for consent to use email addresses, to profile and to share their data with third parties working on their behalf.

Predictions for Social Platforms:

Expanding into TV programming

Social platforms are moving into the television business. While Facebook’s early attempts at Facebook Live failed and Facebook Watch has yet to become a must-view entertainment hub, the company is still forging ahead. Facebook is actively looking to secure broadcast programming rights and plans to develop new content to compete with Netflix and Amazon.

New social messaging offers

Growing messaging and access to news is important for social platforms. Reuters Institute data, shows messaging platforms like WhatsApp and Messenger are growing not just for messaging purposes but for accessing news as well. Facebook is launching a tween messaging app specifically targeting this demo. The idea is to draw the tweens in early and eventually expand their usage to age appropriate entertainment and education content.

Publishers and social platform alike are thinking about new business practices and monetization opportunities with their user base. Importantly, as they shift their strategies to meet 2018 goals, it’s key to keep a consumer focus, especially in the development of new content offerings, personal data information and GDPR compliance and new technology implementations.

Innovation | Revenue

The strategy behind Slate’s engaging new design

Today, Slate unveiled a sweeping redesign that includes its logo, website, mobile, and events branding. But this redesign runs much deeper than a new aesthetic approach. Slate’s new look reflects the organizations’ emphasis on audience engagement over scale.

“Our last major redesign, in 2013, was at the height of the Facebook boom. Social was the driver.” That design was very successful, according to Slate’s editor in chief Julia Turner. However, like most websites, it prioritized social sharing over increasing user interaction and time on site.

The landscape has changed a lot since 2013. In fact, the only constant has been change—with traffic, audiences, and distribution largely reliant on the algorithmic whims of search and social platforms. This is evident in Facebooks recent decision to de-emphasize news articles and anything published by brands in user’s News Feeds. While many publishers are concerned over how the latest change will affect traffic, few are surprised.

Engagement versus Scale

However, the pursuit of likes and shares was just one symptom of a larger trend that dominated the thinking of digital publishers: the quest for scale. As Dan Check, the president and vice chairman of The Slate Group, describes it “social isn’t about increasing time spent on site; it is about touching more people. Scale is fundamentally the pursuit of uniques.”

According to Turner, “We began to see fairly early on—in late 2104, early 2015—that the pursuit of scale for scale’s sake, didn’t make sense for a brand like Slate.” In fact, last September the company moved to engaged time as its primary measure of success, which enabled teams across the organization to put loyalty at the forefront of their initiatives. “The Landscape has become inhospitable to cheap scale. But even more, it doesn’t suit our audience and values.”

The new design builds upon Slate’s commitment to understanding and serving its audience, which Turner describes as “a highly-informed omnivorous media consumer.” Given that they are looking for “sophisticated next-level analysis,” she said it was important that this new design help guide them to information that will offer a deeper contextual understanding of topics in Slate’s five verticals: News & Politics, Culture, Business, Technology, and Human Interests.

With the new design, regardless of whether the visitor is a regular or lands on a page via search or social, Check said “We wanted to give people stronger signposts and a better understanding of what they can expect from us.” The redesigned Slate (which doesn’t use a third-party recirculation partner) will “show people more relevant content and tell the story about who we are. For years, our message was ‘like us on FB, follow us on Twitter.’ Now, it is more about contextualizing what you’re seeing.”

Listening to Opportunity’s Knock

This, in turn, is intended to deepen visitors’ time-spent on the site and affinity for the brand, both of which translate into revenue opportunities. While Slate CRO Charlie Kammerer says that the company has been able to “baseline monetize purely with our programmatic dollars,” the new design will offer more premium membership prompts for SlatePlus as well as newsletter sign ups.

It will also better surface and integrate Slate’s popular roster of podcasts on the homepage and throughout the site. Check points out that for many years, podcasting was a medium awaiting a business model. However, in the decade between the company’s first podcast (in July of 2005) and the explosion of podcasting a revenue driver, Slate remained committed to the format—in large part because its audience was. “Podcasting was something that garnered a lot of audience interest for about a decade. There’s rabid listenership. So, though it wasn’t a business for a number of years, it always made sense from an audience perspective.”

Today, Slate claims 2% of the podcast market share. Kammerer said “We’re glad we stuck with it because when the model matured, we were already in a good position in terms of expertise and audience.” And, with this redesign, Slate will also be investing more in audio, further increasing its roster from a current 24 podcasts and putting out more original shows like its hit Slow Burn, about the untold stories of Watergate, which hit #1 on iTunes on its first day out.

However, Slate’s emphasis on audio and the written word is not an indication that it has “abandoned video” said Turner. “Our video focus is what we can do well.” And, as Kammerer pointed out, the “the case for the pivot to video was a case for scale. The CPMs were higher so a lot of outlets chased those CPMs forgetting that video is expensive to produce well, and that the margins aren’t that great.” In his experience, the CPMs for audio are as good or better than video. “It’s about focus for us and we continue to focus on maintaining a super-premium audience. The written word and podcasting delivers that audience in a very meaningful way.”

News Judgement

And, while engaging its existing audience is a critical piece of Slate’s strategy, they plan to continue to build a quality audience without embarking on an unbridled quest for scale. As Turner put it, “It isn’t that social isn’t a good way to drive traffic. But what you want is a real relationship with your audience that isn’t dependent on social media.” She reports substantial growth in Slate’s Google and Apple News-driven traffic.

Referring to Facebook’s decision to downgrade publishers’ content in News Feed, Kammerer said “If they really want to drive more meaningful interaction, I like our chances. But who knows what changes they’ll announce two months from now?”

As Check put it, “You saw big publishers reach huge audiences through Facebook; a lot of people discovered content they wouldn’t have otherwise. Unfortunately, it has also given rise to a lot of things that aren’t great like fake news and low-quality content.” He sees a genuine market opportunity for existing or emerging aggregation partners who “want to be more responsible.”

Ultimately, Turner sees a real upside for Slate in Facebook’s move to back away from media distribution. “My instinct is that being an arbiter around the news space requires a whole set of real responsibilities and rigor that they’ve been fairly freaked out about. Now maybe we’ll see the return of news judgement to the institutions that have been cultivating that judgment for years.”

Advertising | Perspectives

Facebook ad targeting is incredible – and scary

As Facebook continues to amass enough force and influence to rival a superpower, its ad targeting is not only the social giant’s biggest liability, but also its forte. Entire countries, global populations, legislators, and advertisers both seethe and marvel at its prowess.  And Facebook finds itself caught in a conundrum created by its own success.

One thing is clear: Digital advertising on Facebook is skyrocketing. Most advertisers haven’t been dissuaded by the company’s negative press — because the crisis has yet to directly hit them. However, history shows that brand safety isn’t a given on the internet. Facebook needs to rein in its own power – not just in testimony, but also in practice — so that it can placate regulators and a very concerned public before the next scandal hits.

Targeted propaganda… and eavesdropping?

Russia’s interference in the 2016 U.S. election is obviously one of the biggest examples of what ad targeting intended to spread propaganda and misinformation can do if left unchecked. Some 3,000 ads reached nearly 146 million people with a paltry $100,000 ad buy. And some ads had the explicit aim to exploit contentious issues like gun rights and illegal immigration. Coordinated campaigns operated by fake accounts liked, shared, and commented on these posts. If you spend any time on Facebook, you know intuitively what this means: More interactions increased the chances someone would see these post.

Russia, in essence, practiced what research is only beginning to confirm: Moral outrage in the digital age is akin to pouring gasoline on a fire. Meanwhile, Facebook’s ad targeting tools help to keep the moral outrage burning.

Russia may be the biggest example, but it’s certainly not the only one. Take China. The country may ban Facebook within its borders, but Chinese companies purchase thousands of dollars in Facebook advertising every quarter to help spread its state-sponsored propaganda. That means the typical news you’d see on Chinese television, which touts the country’s prosperity and stability relative to global crises and is subject to massive censorship, reaches far beyond the average worker in China. It’s a digital extension of China’s own foreign policy and entrance into other countries.

Facebook’s recent face-off before Congress has prompted even more attention among politicians on what’s possible on the platform. Two U.S. senators, Mark Warner (D-Va.) and Amy Klobuchar (D-Minn.) recently created a Facebook page for a fictional political group, paid Facebook to target content from the page toward thousands of journalists and staffers on Capitol Hill and found, as one of their aides told Axios’ Mike Allen, “there was literally no mechanism on [Facebook] for us to [prove] we were who we said we were.”

It’s no wonder rumors Facebook is also eavesdropping on our conversations are popping up. Some have debunked the myth, but only because, they say, Facebook is already too powerful to even need to consider that.

Selling point for targeted ads

Here’s the deal: Facebook’s ad targeting is so scary because it works so well. In the middle of this political mess (and consumer concerns about sacrificing our data and ourselves to Facebook) it’s likely that there are marketers who interpret the Russian campaign as impressive. It’s basically a selling point for cheap targeted advertising on the social giant.

“For better or worse, one key takeaway from this is how effective Facebook can be as an advertising medium,” Kyle Bunch, managing director of ad agency R/GA’s social practice, told BuzzFeed News. “Many advertisers are probably asking themselves, ‘How can I make better use of data to have my campaigns get those kind of results?’”

Who’s who

Any type of post can be promoted on Facebook. Should Facebook, which largely requires people to use their real names (unlike Twitter), create more restrictions on who buys ads and sets up Facebook Pages, requiring more information and verification? One would assume that an up-and-coming restaurant would be willing to invest the time to apply for verification. However, there are those who will grumble at the tediousness. Other critics might wonder why Big Brother Facebook must have the responsibility of verifying the credibility — and by extension, morality — of these buyers.

But as frightening as it may be for some to admit, Facebook is already a Big Brother. Advertisers, or anyone who wants to promote their brand to the world, for that matter, can’t afford to sacrifice the unparalleled scale the company offers. There may be other tech companies, but there is no other Facebook. The social behemoth has pledged more transparency and more hiring of ad reviewers, but that will never be enough as long as scandals continue to come to light. Congress may not be satisfied with self-regulation alone. And ultimately, Facebook will have to rein in its overwhelming power and set up checks and balances – even if it takes a short-term hit on revenues – to satisfy an angry public.

Perspectives

Regulation is coming for the tech giants – but how much?

With their enormous size, influence and well wishes to do good for humanity, the American tech giants have long escaped the regulatory and legislative scrutiny of Washington. But increased attention on how Russian operatives may have used Facebook, Twitter and Google to meddle in the 2016 U.S. presidential election — and a mounting anti-Silicon Valley sentiment — are providing an opening for regulation to finally come through. Most Americans don’t necessarily trust the tech companies, yet they maintain high approval ratings, enormous clout and popularity for their products and services.

Google, Facebook, and Twitter have all faced the House and Senate Intelligence Committees this week, and the EU is on its way to passing legislation that will maintain data protection and privacy in Europe. After many years of avoiding regulation, the tech giants are finding themselves cornered from the left and the right, with some sort of American intervention on tap. The question is just how effective it might be, and how much the tech companies’ lobbyists will water down those efforts.

The argument for accountability

Take the case of Google. Among some of Google’s media rivals who are critical of the way the search giant surfaces news stories, the effort to increase government regulation has been dubbed “Project Goliath.” Yelp’s disdain for the company has grown over the years, and recently led to the filing of a federal antitrust complaint against Google for scraping photographs from Yelp reviews.

The News Media Alliance, which represents 2,000 news organizations, in July started advocating for antitrust exemptions in the hopes they might help bump against the Facebook-Google advertising powerhouse (Google is the world’s largest recipient of advertising revenue). The European Union has also fined Google $2.7 billion — the largest antitrust fine the EU has imposed on a single company — for favoring its services over rivals in search results.

And that’s just one company. Amazon, Apple, Facebook, Google, and Microsoft — what New York Times’ senior technology correspondent Farhad Manjoo collectively calls the “Frightful Five” — have been waging a battle over an anti-sex trafficking bill. The bill’s promoters want to curb legal protections for sites that host content promoting sex trafficking, but critics say the bill’s language could restrict free speech. Facebook and Twitter, to name two of the frightful, are continuously in headlines over the platforms’ influence on politics both nationally and globally.

And we can’t forget about Amazon, the massive online retailer that now owns brick-and-mortar Whole Foods and recently clocked more than $1 billion in ad revenues in the third quarter.

Tech lobby ‘armies’

The amount of pressure on these companies, and the momentum with which it is finally cascading, makes it likely that some amount of regulation is bound to happen. Ahead of their Congressional hearings, both Facebook and Twitter made changes to their advertising platforms, with more transparency around political ads in the hopes that self-regulation might ward off a harder fist from Washington.

Yet the power and money of these technology companies, and their influence on Capitol Hill, also means regulation will be hard-earned and hard-won. The New York Times’ Cecilia Kang writes:

“Internet companies are deploying some of the largest armies in corporate America to battle on Capitol Hill. House and Senate staffs say lobbyists for the big technology companies have swarmed their offices in recent weeks. Amazon, Apple, Facebook, Google and Microsoft have sharply increased their lobbying spending — a combined $14.2 million in the third quarter, up from $11.9 million a year earlier. Facebook, which has faced the most scrutiny over the election, increased its third-quarter lobbying budget this year by 40 percent, to $2.85 million.”

To say the rivals and critics of these companies don’t stand a chance in circumventing the giants’ power might be an exaggeration, but money talks. The IAB has also come out in defense of these internet companies, arguing that the problems within their industry are best left for them to solve on their own — not with the help of Washington.

Inspiration from the EU?

If U.S. players in this struggle are looking for inspiration for regulation, their European neighbors might be a good source. Compared to Washington, the EU is much more suspicious of the industry’s altruistic proclamations, and is demanding changes to Facebook and Google’s business practices that emphasize privacy for and consent from consumers regarding their data. Given the EU has already launched a taskforce aimed at protecting WhatsApp user data from Facebook, one can imagine the strict clampdown on tech will continue.

Will the U.S. match up? Likely not. But if the media cycle continues the way it has been in the U.S., and the critical voices here stay loud, it’s safe to say tech’s free pass is long gone.

Industry-Research

Consumers demand increased transparency from tech platforms

Consumers are very familiar with digital recommendations. Suggestions online are a constant and come in all varieties from recommendations on new products to purchase, to new songs for your playlist, to new individuals to connect with to news posts in your newsfeed. As consumers spend more time on social platforms consuming content and expressing their views on just about everything,  more data is collected, and more algorithms are employed to extract value from consumer information. However, consumers appear mystified as to what usage data tech platforms collect and how it’s parlayed into algorithms to impact their content results.

The Tow Center for Digital Journalism examines this question and others in their study, “Readers are hungry for news feed transparency.” In all, they conducted 13 focus groups across four cities with news consumers. The goal was to understand consumer usage and to clarify the role of algorithms in terms of tech platforms’ accountability and transparency, particularly in the distributed news environments.

Key findings include:
1. Tech platforms and news habits

Participants claim that their news and information consumption on tech platforms is more of a consequence and not their main intent upon visiting. They believe the ease and convenience of accessing news when visiting social platforms fuels this pattern of news consumption.

2. Algorithms

News audiences understand few details about platform algorithms. In fact, many participants have little awareness of algorithm usage. While, others see algorithms as filters for relevant content and personalization. Still others think their usage remains independent of algorithms and generally overestimate their degree of control on their news feeds. Interestingly, many participants said they are willing to leave tech platforms because of the lack of transparency with their algorithms and privacy practices.

3. Local news

Participants think local news has little to no visibility on tech platforms.

4. Brand 

Audiences claim they can recognize publishers’ brands on platforms. They also admit to sharing fake news, thinking at the time it was accurate and truthful. Many participants identify what the Tow Center refers to as the “third-person effect.” According to the participants, they of course, recognize solid news brands but it’s “others” who do not and end up sharing fake news.

Participants link fake news to social platforms and place responsibility on them for allowing fraudulent information to be shared. While consumers debate platforms’ ethical responsibilities, they agree that offering ineffective solutions to identify fake news is not the answer. Further, audiences also see platforms as often having political biases. They think platforms are quite challenged in their ability to remain politically neutral.

5. Privacy on social platforms

Participants are concerned with tech platforms’ black box practices and lack of transparency, yet they appear resigned to the practice of data collection. Surprisingly, data collection is viewed as the price paid for accessing these platforms. Not surprisingly, the younger the participant, the more accepting of a platform’s data collection practices.

6. Business models 

Participants acknowledge the value of news content; however, they often engage in practices to avoid publisher paywalls. The ease to which consumers can access news content on social platforms reinforces the practice of non-paid for content.

In terms of advertising, native advertising and the use of sponsored links such as “recommended links” or “partner content” is viewed with little trust and appears to carry negative views on the publisher.

The research suggests a necessary unveiling of algorithm practices for both publisher and tech platforms to maintain a trusted relationship with their audiences. It’s essential to offer tools and education to verify brands and the legitimacy of content and to unveil algorithms, tracking and privacy policies.

Advertising | Perspectives

Google and Facebook must do more for brand safety

With the great power that Facebook and Google have accumulated in online advertising comes great responsibility. For years they tried to play it neutral as platforms and not make editorial decisions. That’s now changed dramatically as they have had to take actions on many fronts, from fake news and spammy websites to Russian interference in the U.S. election. But have they done enough?

The explosion of fake news on Facebook and its potential interference with the U.S. election last November initially put the social media giant on the defensive. But now, Facebook has admitted that it found about $100,000 in ad spending from June 2015 to May 2017 on the platform connected to inauthentic accounts that likely operated out of Russia. Google too faced loads of backlash after brands realized their advertising was appearing alongside racist and extremist videos on YouTube and other sites, thereby marking them as supporters of hate.

It’s no wonder then that Facebook and Google are making bolder moves to restrict algorithmic ad targeting. However, ongoing eruptions of how their advertising is backfiring casts a stronger light on the pitfalls of programmatic and self-service ads, and the checks necessary to ensure brands maintain their safety.

Targeting racists with ads

ProPublica’s damning report of how Facebook enabled advertisers to reach audiences who had specified interests in “Jew hater,” “How to burn jews,” or “History of ‘why jews ruin the world’” cast an international spotlight on the company, which was already under intense scrutiny. Acting on a tip, ProPublica reporters spent $30 on Facebook’s automated advertising platform to target these audiences — admittedly tiny, though Facebook did suggest additional categories that might boost the audience size. And Facebook’s automated platform approved the targeted ads within a span of 15 minutes. Facebook then immediately censored the anti-Semitic content after ProPublica informed the company.

BuzzFeed’s Alex Kantrowitz then piled on and discovered that Google allowed advertisers to target people who had been typing racist, bigoted, and derogatory terms into its search bar. It would also suggest similarly loaded racist and bigoted terms within its ad-buying tool.

Given that Google’s Adsense only monitors content at the page level and not the site level, brands also run the risk of their advertising appearing on so-called “safe” pages of extremist sites, despite Google’s efforts to monitor hate speech.

Are current restrictions enough?

The tech giants have taken action, including removing those search terms from ad targeting after those stories ran. But they are in a Catch 22, because the more they restrict, the more they become arbiters of free speech vs. hate speech. And not even they want that kind of role.

Facebook, for one, said it was adding new standards — enforced by a combination of human and automated review — to ensure fake news videos and objectionable content had nothing to do with advertising, and vice versa. Facebook has 5 million advertisers on the platform. And its newest ad opportunities will come through its new video section, Watch, as the company pivots more toward video and in-stream video advertising.

Facebook has announced “monetization eligibility standards” to offer clearer guidance on what kind of content, publishers, and video creators can profit from advertising. It has also stated that it will start releasing “post-campaign reports” to advertisers outlining where their ads actually appeared, as part of an overall effort to monitor their monetization.

Google too has insisted that a video channel now must reach a 10,000-view threshold in order for it to make money from ads. It hopes that this will better police extremist and hateful content, and calm the fears of advertisers. After BuzzFeed’s report, Google senior vice president of advertising Sridhar Ramaswamy admitted it had to step up. “In this instance, ads didn’t run against the vast majority of these keywords, but we didn’t catch all the offensive suggestions. That’s not good enough and we’re not making excuses. We’ve already turned off these suggestions, and any ads that make it through, and will work harder to stop this from happening again.”

Not to be outdone — especially since news reports revealed ad campaigns utilizing derogatory terms appeared on the platform — Twitter has also announced it has fixed what it calls the “bug” that allowed some advertisers to use racial epithets and offensive terms.

Finding the right guide

But the elephant in the room is whether these companies themselves should be doing the policing, or whether a third-party group (or even the government) needs to step in to ensure accountability. More human oversight is an obvious answer to the problems of automated advertising. But consider this: What might have happened had not ProPublica, BuzzFeed, and other news organizations stepped in to counter-check the kind of ad targeting possible? These ad campaigns would likely very well still be in use is the probable answer.

Google, Facebook and other major advertising platforms have incentives to keep themselves in the clear only when their own brand safety comes into question. Creating more collaborations with third parties, as the platforms have done in the fight against fake news, seems all the more necessary to ensure brand safety for everyone.

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