News UK revenue buoyed by ads.txt adoption
Ads.txt has been arguably one of the biggest trends to emerge in 2017 as a solution to cleaning up the programmatic supply chain and adoption rates are accelerating. Perhaps surprisingly, it is also something that has helped traditional publishers see a boost in their revenue, News UK has revealed.
Speaking at The Drum's Programmatic Punch on Thursday (9 November), Ian Hocking, head of programmatic at News UK, said the publisher - an early adopter of ads.txt - saw a “slight incremental rise in revenue” when it adopted the standard.
Ads.txt is a standard which lets publishers list authorised resellers of their inventory thus better enabling them to prevent a common means of ad fraud known as domain spoofing. Despite being hailed as a solid step forward in the industry’s efforts to clean up ad fraud, initial adoption of the tool was slow.
However, this appears to have changed in the last month, boosted by Google’s support of the tool and its efforts to increase uptake, which has included an ads.txt generator and validator in DoubleClick for Publishers, as well as ads.txt alerts in AdSense to let publishers know if it has identified errors in their ads.txt file.
At present, approximately 55% of ComScore top 200 UK ad-funded websites have adopted the tool, according to figures from the Internet Advertising Bureau (IAB).
To implement the tool, publishers need to drop a text file on their web servers that lists all the companies that are authorised to sell the given publisher’s inventory.
Since ads.txt is an open plain text file, anyone can see a publisher’s file by typing their URL into their browser and adding '/ads.txt' to the end address.
This allows publishers a rare opportunity to look under the hood of their rivals by seeing whether the adoption of ads.txt has altered the amount of partners each publisher works with.
“Can I afford to have 100 different people selling my inventory? Our file was pretty short, we want brands and agencies to come to us and have a conversation about the best ways of using our assets. By opening yourself up to resellers you open yourself up to problems,” Hocking added.
Initial concerns centred on the ease of implementing the tool for publishers that have depreciating resource. However, when asked by The Drum both CNN and the FT have said implementation is usually achieved using “little resource”. What’s more, the less programmatic partners a publisher has, the easier it is to implement the tool. For the FT, which only works with two partners, it was simple.
While CNN has many more partners than the FT - as indicated by its ads.txt file - Simeon Clarke, global head of programmatic & data operations at CNN International Commercial, said adoption of the tool was shared between its programmatic and development teams.
"It’s also been a good process to go through with our demand partners, who we have found to be as engaged in the process as we have been," Clarke added.
That said, ads.txt is not a 'silver bullet' solution to solving ad fraud in the industry, which has matured into a complex business of which ads.txt solves a small part.
Speaking at a press event held at Google's European headquarters last week, Google's chief adspam advocate Andres Ferrate said believes ads.txt forms the “foundation” upon which the industry can work together to build additional products aimed at cleaning up ad fraud.
“Taking ads.txt as an example, I feel like we have taken a point where industry is collectively aware and proactively taking steps. That is the foundation upon which a bunch of additional work will be built. I feel we are going to find a resolution for the challenge,” Ferrate said.
An 'imperfect' solution
What's more, as adoption of ads.txt has risen, loopholes have been exposed. A recent case reported by Digiday found that a random aggregator was calling up publishers and demanding to be included on their ads.txt, claiming the publisher would lose revenue if it did not. When the publishers looked into the aggregator, they couldn’t find any reference to them in any of their trading contracts.
Dee Frew, adtech manager at IAB UK, said ads.txt is "only as effective as people are willing to adopt it".
"There is a baseline knowledge level necessary, it is not enough to just stick a text file up there and forget about it. You have to maintain it, trust the people you are including on it," he said.
"And then we need the buy side to make it a requirement. The publisher, the sell-side, can put this in place. What they are effectively doing is offering a stamp of approval, a seal of quality. But if the buy side doesn't care or doesn't want to check for that, no one is going to twist their arm. We don't have ads.txt bailiffs or enforcers going out there and breaking anybody’s legs," Frew added.
Police a 'last resort'
Economic losses due to bot fraud are estimated to reach $6.5bn globally in 2017, according to an ANA/White Ops Study. Global fraud operations have reached such a scale that law enforcement has been forced to intervene, calling the industry’s ability to self-govern into question.
However, the industry's stance against police intervention has remained steadfast. Even the FT, which found evidence of domain spoofing, said it didn’t get the police involved when alerted to the fraudulent activity.
This is due in part to budget constraints. Should the ad industry decide it wants to tackle fraud from a legal perspective, the industry would have to fund a dedicated investigative unit of the the Police Intellectual Property Crime Unit (PIPCU), since there isn't currently a level of expertise in the police force to prosecute fraud.
"That could happen if there was a need for it," suggested Frew. "There is a budgeting consideration here, what is the cost of funding that unit in terms of your yearly budget versus how much money are you losing to fraud siphoning money away from your account? It needs to be something where everyone pulls in the same direction."
Instead, the IAB is working to ensure there are "as many self-regulating apparatus in place as possible", in order to prevent the need for police intervention, Frew said.
A media company which wished to remain anonymous said that fraud or data leakage issues are dealt with by in-house legal teams, a "tried and tested" formula which also helps the company to keep issues "contained".
"If there was a particular offender that you knew was a repeat offender, I imagine you would go down the police route, but the problem is you don't know what jurisdiction the offender would be in," the spokesperson said.
"I don't think it is an ethical matter of self-regulating. If we thought the criminal path was the quickest way we would do that," they added.
Despite the FT's stance against involving law enforcement, Jessica Barrett, global head of programmatic at the publisher, believes the industry is "pretty bad" at self-regulating. However, industry-wide collaborations like ads.txt represent green shoots of change, especially when you have a powerful company like Google "throwing their weight behind it", Barrett continued.
"Only then do you see change", she added.