One trillion

Edition #453

The ad market is going to reach one trillion faster than expected, LOADS of deals & Artifact lives on at Yahoo.

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In a shock announcement to the market Oracle appears to be breaking up with Moat. If we roll back the clock, at the time it was a good acquisition, with the market going, hey if we get the CMOs attention, they help dictate digital transformation which drives cloud & tech spend. So if we buy Moat, we can have a seat at the table. We’ve seen Accenture did this really well, acquiring digital agencies on this strategy.

But for Oracle, once they had done a few acquisitions they butted into the same problem Verizon did, privacy. Did they want to rock the boat on privacy when it could impact way bigger chunks of revenue. But also Oracle has found a better strategy, of acquiring verticals outright and bringing more Oracle solutions to them. i.e. Cerner in Healthcare.

I asked Ronan Shields what he had heard at the Tech Lab which was on when it was announced:

’The downfall of Oracle’s advertising ventures was discussed a lot on the sidelines of the [IAB Tech Lab] conference, and quite a few said it had been slowing down a bit for about a year with accounts people there not pursuing contract renewals, etc.

‘Another thing that people said was that DV and IAS would be the big ‘winners’ out of this, as they’d have the former Moat customers to go after, while some people would feel it in their pocket if they had been making money from Oracle’s data exchange.’

But so, what now? The feeling is they would probably close it rather than try and sell. They have said the business unit does $300m of revenue. Unclear of the revenue split between BlueKai, Grapeshot and Moat. You can envisage that would have meaningful enterprise value, so spinning it out would draw interest.

So if there was any deal, it would have to be simple. Maybe how Wynn gave Barstool back to Dave Portnoy, for no money exchanged but a liquidation preference on any future transaction. That might be a model.

Also don’t forget TikTok. Oracle is the partner, hosting data in the US. It’s a minor point but optics around ‘privacy’ and then also we are helping keep Americans TikTok data private – are somewhat at odds. Even though the reality of these two pieces of business inside such a large company likely wouldn’t make it a risk at all.

Why does this matter? Well the viewability/verification/optimization space is even bigger now than when Moat, IAS & DoubleVerify started. It is entirely feasible that Moat as a standalone entity could keep growing!

We also saw Equativ also bought Sharethrough this week, to bolster North America efforts, Sharethrough early pioneers in native advertising and breaking ground in CTV. Congrats to the teams.

And a little exciting news, GroupM sees the ad industry as hitting $1 trillion sooner than expected.

Notable stories this week

• Branded entertainment is back!
• Artifact’s DNA lives on in Yahoo’s revamped AI-powered News app.
• Google urges publishers to diversify distribution beyond search.
• I used to run a popular newsletter. Then things started getting weird.
• How YouTube’s recommendations pull you away from news.
• Brands are embracing ad-free features on social media, like comments and DMs.
• TikTok creators experiment with Substack.
• Perplexity was panning revenue-sharing deals with publishers when it came under media fire.
• Email from BI CEO on impact of Google’s recent search changes.
• Ryan Reynolds on why streaming tv ads are about to get a whole lot better.
• Lumen Research announces EMA partnership with IPG Mediabrands.
• Ad industry insiders say the vibe has soured on verification giants. And Ad verification is under fire.
• Welcome to Vibevertising.
• Michael Kassan reveals his big post-MediaLink venture.
• Meet the Google TV network.
• This is Yahoo’s more transparent answer to set-it-and-forget-it Tools: Blueprint Performance.
• The war on friction.

Deals/M&A

• Sharethrough & Equativ merge to create one of the largest independent ad platforms in the world.
• Oracle is shutting down its ad business.
• WorkWeek raises $12.5m.
• BeReal acquired by French app developer Voodoo.
• Madhive acquires Frequence in a push for local omnichannel budgets.

Campaign of the week

• Starbucks with Tony Hawk, hosted on his channel. 

View all 2024 best campaigns.

Smartest commentary

• “The growth of mobile digital media platforms has meant we are all now schedulers. We now make thousands of decisions about how we schedule our attention, and even if the platforms are designed to try and take away that agency (by autoplaying the next episode, or presenting us with endless ‘for you’ scrolling streams), we are still way more in control of what we watch, and when, than we were in the age of scheduled media in the late 20th century.” –Matt Locke, Storythings.

Datapoints of note

• Global advertising revenue will grow 7.8% in 2024 to nearly $990 billion, excluding U.S. political advertising, media investment group GroupM said in a new forecast significantly raising expectations from a previous estimate of 5.3%.

Events

• Attention Happy Hour, come to the next one.

View all 2024 datapoints of note.

That’s it for this week.