Sherman Act

Edition #391

On how liquor companies can’t own the outlets they are sold in – and what that means for Google. AI content and loads of stories this week.

I’m on page 33 of the Department of Justice’s complaint against Google and its practices in the ad tech space. It is worth giving it a read, to see exactly what the complaints are and their rationale. It is also curious, to see how a narrative can be created from the events, which doesn’t always match what you’d thought. No judgement either way, it’s just if you’ve been in the industry, you remember these events happening but haven’t always put them in a chronological and connected manner.

Of course, on what basis is the whole complaint? It is from the Sherman Act, the act prohibits anticompetitive agreements and conduct that monopolizes or attempts to monopolize a market. The intent is to protect the public from the failure of the market to act in a fair & competitive way. It is not to halt competition but to halt practices which are harming a competitive thriving market.

The act tends to frown upon, when a party is on the sell side and the buy side of a transaction. The classic example is a liquor company owning a bar, they can’t or shouldn’t own a bar, because they can manipulate prices or other mechanisms to their favor.

And this is the area that broadly speaking there is concern. Google sits on both sides and holds a market leader position in both. The complaint outlines behavior to co-ordinate the buy and sell side to protect those positions. That is the spicy point of view.

The counter to that, is likely to be along the lines of, how Google’s market share is diminishing within digital advertising and that as a share of the overall advertising market it is small. Small fish, big pond. Which is true.

Mike Shields points out, even if the adtech side is broken up, Google still controls the browser – Google Chrome. What’s to say, they then don’t make more changes there, that make the break up redundant.

So far, I haven’t seen anyone point to analytics, a space I know well. Google Analytics provides Google with all the intelligence it needs. It knows who is growing, who is shrinking, how well they perform. Who your competitors are. I’ve been surprised that Amazon, Apple & Facebook haven’t sought to disrupt that. They only know how well their own ads are going.

The problem is, once you’re big, you want to stay big. And the internet tends to zig zag, maybe the zag is to break it up. If so it will then also impact Amazon, Apple and Facebook. As a friend pointed out to me, what if you had an adserver that let you sit across digital and tv. That’s where innovation and growth can happen. Which may lead to adtech becoming the hot new thing again.

This is a big extrapolation, but it’s the kinds of extrapolation the DOJ would be doing. What happens if.

Notable stories this week

• Verizon to partner with Semafor on sponsoring its text interview series.
• From car videos to car auctions to car empires. The story of YouTuber Doug Demuro and his journey to Cars & Bids.
• Twitter is shutting down its CoTweets feature immediately.
• AI- generated content is here, should advertisers buy it? And SEO Spammers are thrilled Google isn’t cracking down on CNET’s AI-generated articles.
• Ghost launched a newsletter directory, and Jakob created an air table of those that share the subscriber/revenue counts.
• Instagram’s co-founders are mounting a comeback with Artifact. Am giving it a go.
• @dieworkwear, Twitter’s ‘Menswear Guy’ is just as perplexed as you are.
• This LinkedIn post has a bunch of strategists sharing their fav newsletters.
• The chumbox is still the dirty design secret of the internet.
• Gaming soared during the pandemic – but in-game advertising never did.
• Media companies cut jobs as they brace for advertising slowdown. TheSkimm lays off nearly 10% of staff.
• Bustle is suspending operations at Gawker.
• Many brands are ‘reluctant buyers’ of ads on retail media networks.
• A frank look at a fake user base.
• Netflix tells advertisers sign ups to ad tier doubled in January.
• Justice department sues Google for monopolizing digital advertising technologies.
• Meta was scraping sites for years while fighting the practice.
• Apples Major League Soccer tv push comes with no guarantees for advertisers.
• Digital advertising’s existential crisis.

Deals/M&A

• OpenWeb acquires Jeang to move into personalized emails.
• Digital agency Constellation has secured $15m in funding.
• Atlas Obscura finds growth in its trip planning business, as it aims to be profitable before raising funds in a tricky market.

Campaign of the week

• Verizon with Semafor, turning their text message interview format into a piece of branded content.

View all 2023 best campaigns.

Smartest commentary

• “Those morel mushrooms were not accidental. We, the readers, chose these images. Chumboxes are a mirror of our worst impulses; no matter how much we complain about them or the degradation of the internet, we’ve created them. And we sustain them.“ –Zachard Petit, Fast Company
• ^ An interesting take, on how, because we respond to these things, we are helping self select the best images.
• “It’s just amazing to stop and consider that we live in an era in which a random person can take his obsession with horror movies and turn it into $2.6 million in revenue. If this guy had been born 20 years earlier, then this passion would have been virtually worthless — at best, he could have produced a tiny print zine — but now he can build an entire media company around it that reaches millions of people” –Simon Owens

Datapoints of note

• Apple is selling sponsorships for $4m/season of MLS.
• A Taboola & Kantar study. Brands that used native advertising consistently met and often exceeded critical KPIs across the board—significantly outperforming industry benchmarks.
• ^ Some other highlights from the same study: Brand favorability lift was 15%, 4x higher than the industry average. Consideration lift was 7%, 1.5x higher than the industry average. Message association lift was 87%, 8x higher than the industry average. Awareness lift was 10%, in line with the industry average.
• Atlas Obscura doubled its revenue to $18m in 2022.
• Spotify has 489m users. 205m are paid.
• Spotify earned nearly half a billion dollars in ad revenue last quarter.
• The average monthly programmatic CPM in the open market in Jan 2020 was $1.45. Compared to $1.21 this year.

That’s it for this week.

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