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How the industry is reorganising itself to counter the duopoly of Google and Facebook


By Charlotte McEleny, Asia Editor

December 8, 2016 | 8 min read

There is such a thing as too much of a good thing, particularly when it is removing competition and marking its own homework. Or that’s what the industry seems to be feeling about the dominance of technology platforms come media owners Google and Facebook.

Key issues in the fast-developing adtech sector were debated at Programmatic Punch UK

Key issues in the fast-developing adtech sector were debated at Programmatic Punch UK

The UK’s leading programmatic practitioners congregated this week in Shoreditch at The Drum's second annual Programmatic Punch to debate issues blighting the industry’s path to using programmatic technology to the best of its ability.

One of the key themes, for both the brand and publisher ends alike, was the impact that an overly dominant Facebook and Google would have on the market – with certain estimates claiming they collectively account for over 75% of the digital advertising market.

The complaints come in different forms; the issue of walled gardens preventing advertisers from universally leveraging their audience data is still a huge concern for agencies and brands, as is the issue that some ad tech platforms will push out agencies by trying to go direct to clients.

For publishers the onus is to become less reliant on the duopoly when audiences are being traded, a retaliation to a bias that the industry believes takes place within the Google adtech stack DoubleClick.

Martin Kelly, Infectious Media, CEO, speaking at Programmatic Punch 2016

Another dynamic that surfaced during the day was solving the problem of adtech businesses going direct to clients. This is arguably a difficult one to solve as it’s based on human behaviour, rather than one that can be solved with technology. As Infectious Media co-founder & CEO, Martin Kelly, said: “For agencies, it’s frustrating when partners go in directly to a client, it's a sure fire way to piss them off, but it's difficult to argue with businesses like Google having a direct relationship with advertisers."

However, the issue that the likes of Google and Facebook are walled gardens is being addressed in significant ways by the industry. Holding both the inventory and data that agencies and advertisers need to gain access to consumers in closed environment is detrimental to the holy grail of a single customer view. It’s something that WPP’s GroupM is directly addressing in the launch of its new [m]Platform proposition.

Speaking to The Drum at the time of launch, global chief executive of [m]Platform Brian Gleason, said: "What we’re trying to do is solve the problem of clients trying to build [universal campaign reporting]; it’s still less than 10% of clients have a singular view of their customer, so that’s a challenge. If you look at the market place, certain publishers have tremendous data sets on consumers – whether it be Google, or Apple - and fantastic relationships, and for us the challenge is how do we do that for our clients?"

During a panel on the changing shape of agencies, Infectious Media’s Kelly, commented on the launch of [m]Platform: “The industry needs to start leveraging scale differently and leveraging media spend to build unique data assets is a really smart plan. Criteo is another one that has aggregated advertising to create a cross-device graph. The issue is around getting client contracts right and getting people to understand it conceptually.”

Jonathan Nash, fellow panelist and head of programmatic UK and international at Teads, said that while the move was positive for the industry, there was another issue as it was another closed solution. He added: “If advertisers understand it then it could be right thing to do but what if you want to move to different holding group, where does the data sit?”

Outside of the holding group world, another alternative has been the ad tech coalition DigiTrust, which is now looking to build publisher interest and support. It effectively wants to create a single customer view by creating a standardised ID but at this stage publisher adoption has been slow, but this looks set to change with publishers increasingly banding together, like in the setting up their own coalitions, such as the Pangaea alliance.

Commenting on this, Dan de Sybel, CTO at Infectious Media, said: “Publishers are learning to put their faith, and their futures, into broader industry alliances in order to help improve the overall health of the media and advertising ecosystem and take the fight to Google and Facebook. We can expect publisher commitment to DigiTrust to increase significantly over the next six months.”

Another tool in the publisher arsenal has been header bidding, the promise of which has been to fix issues with supposed biases existing within the ‘waterfall’ tech stack (read 'DoubleClick) where Google's algorithms allegedly favours its own media and impressions.

Adtech execs and publishers discuss header bidding at Programmatic Punch

Also speaking at Programmatic Punch, Amir Malik, programmatic director at Trinity Mirror (pictured above), who said the fact that Google was now responding to the technology, which means it [header bidding] was already having an impact.

He added: “Header bidding has been a fantastic development for us, it is largely an opportunity to stop the dominance of Google over ad inventory so we can resist Google taking the first look on every impression. Google rarely responds to initiatives in the adtech space, unless billion of dollars are in it for them and they are responding to header bidding.”

Alongside him was AppNexus VP of strategic development in EMEA Nigel Gilbert and Andrew Buckman, managing director EMEA of OpenX (also pictured above). All three agreed that one retaliation from Google to header bidding was a common criticism around latency and a lack of standards; Buckman cited a US publisher that used 14 different header bidders that all worked differently.

This was a criticism levelled of header bidding earlier in the day by Elli Papadaki, global head of programmatic at the Financial Times (pictured below), during a solo interview session, where she explained her decision to opt against header bidding.

Elli Papadaki, FT, global programmatic director, speaking at Programatic Punch 2016

She explained that concerns over how the time it takes to process bids made through header tags may lead to latency over page load times. Decision makers at The FT where thus concerns how this may impact the premium nature of its offering (reflected in its premium subscription revenue).

Hence it has thus far decided to pass on the opportunities posed by header bidding. Papadaki further explained how The FT said it was favouring a more long-term view on revenue, rather than short-term improvements to advertising yield.

Click here for a more in-depth examination of what both Mailk and Papadaki had to say about header bidding on the day.

Google, which was invited to participate in the panel but declined the opportunity, has not yet revealed its response to header bidding but Gilbert said that ultimately all adtech on the sell-side had been a hack on the ad server, because it didn’t do what the industry needed. He said changes would have to be made after header bidding “exposed motive behind DoubleClick for Publishers”.

Trinity Mirror’s Malik, who previously worked at Google, said the response was likely to be artificial intelligence and was backed up by Google’s heavy investment in that area.

“The data all exists that can show what is going on and what is missing. Why does The Guardian get only 30p for every £1? Who can lift the lid up? You can see this happening with Amazon Cloud. There is an opportunity in getting the data and putting night vision goggles on it. Google knows that this will happen, if it doesn't do it itself.”

This isn’t an issue that only Google is looking at, however, as the other side to the industry duopoly Facebook is also said to be developing tech to counter this.

Click here for more of the issues discussed at Programmatic Punch, and check out #ProgPunchLDN to find out what some of the audience had to say about proceedings

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