I hope you had a good holiday and welcome back to the 4th year of Last Week in Digital Media.
A lot of people across the industry will be heading off to CES which will dominate the news cycle, so I’m getting a head start to both share my thoughts about the year ahead and some of the news you may have missed while the newsletter was on break.
As we enter a new year, I have been reflecting on what trends will define digital media and the decade ahead. After some thought, I landed on “3 R’s = Rights, Responsibility, and Regulation” as principles that will set the agenda for the coming years.
- Rights: People will become increasingly well informed of and demand that their digital rights be protected (and neither discriminated against or penalized by data and algorithms). Part of this involves the 3rd R – Regulation, but it will be driven by an increased journalistic focus on topics of data and privacy and academic debate about the topic. Advertisers and brands that want to be successful in the years ahead will need to put the rights of people first and I emphasize the word “people” over the word “consumers”. For evidence of the Rights trend, see this New York Times piece on location data or that Barack Obama’s favorite book of 2019 included Surveillance Capitalism.
- Responsibility: Brand safety will evolve beyond just avoiding “bad” content to also consider “what” advertising funds (publishers and platforms). It will no longer be enough to just protect advertisers brands but to also protect the best interests of the people and society brands serve. Responsibility will see brands holding publishers and platforms to account, a trend already started by people themselves. The first steps of Responsibility were taken last year by the World Federation of Advertisers (WFA) Global Alliance for Responsible Media (GARM) but expect this to accelerate, especially in the context of elections, political advertising, and editorial decision making. Adtech companies and platforms should be well advised to take Responsibility seriously as well.
- Regulation: Since the advent of GDPR and the arrival of the CCPA in the US regulation is almost a given, but beyond data privacy over the next decade expect competition regulation, content regulation (particularly around fake content), rules on digital political advertising, to even regulating algorithms themselves (on the latter Australia is looking to regulate the algorithms used by Google and Facebook (PDF link) and China is looking to broadly regulate algorithms (English via Google translate). Regulation is perhaps the biggest signal that the digital industry has matured and recognizes the importance of digital in everyday life. The call-out on Regulation is that it is an opportunity for everyone in the industry to work in partnership with regulators, whether this is in education, participating in policy debate, or even in Public service.
As advertisers, marketers, and industry (adtech and platforms), if we collectively embrace the 3Rs – Rights, Responsibility, Regulation, then the next decade will be as exciting for digital as the last. If we fail, if we don’t put the Rights of people first and act Responsibly then we expect the full weight of Regulation to unleash a 4th R – “Reckoning” that has the potential to be enormously disruptive. Making it all the more important we put Rights and Responsibility front and center of how we think and act in digital over the years ahead.
Now onto Last Week in Digital Media and the news you may have missed.
- Snapchat is launching Bitmoji TV on the platform in February 2020. You can check out a preview of Bitmoji TV on YouTube. Bitmoji is one of Snapchat’s best weapons against competitors, as no one else has followed them into the avatar space.
- Coca Cola and McDonald’s are the first brands to use Snapchat’s Scan product, which unlocks custom lenses based on scanning a product. The benefit of Snapchat Scan is it negates the need to have any Snapcode reducing the burden on brands to produce custom packaging.
- in other Snapchat news, the company acquired AI Factory, a computer vision startup. AI Factory developed Snapchat’s Cameo feature.
- TikTok had a mixed end to 2019, with TikTok’s CEO postponing a proposed trip to Washington DC, the US Army and US Navy banned the use of TikTok on Government-issued cell phones, and there are rumors that TikTok’s parent (Bytedance) is considering a sale (or partial sale) or shifting TikTok’s global headquarters outside of China in an attempt to address concerns about the company. TikTok also published a transparency report, showing that China has not requested TikTok to remove or takedown content in the first half of 2019.
- in TikTok product news, TikTok’s parent (Bytedance) is said to be working on an AI-drive face swap feature similar to the technology used in deep fakes. It’s also reported that TikTok’s in-app revenue is on track to hit US$50MM++ in the last quarter.
- Adtech companies Rubicon and Telaria have agreed to merge in a stock for stock merger. The combined entity will continue to focus on video, particularly opportunities in the connected TV space with the merger expected to complete in early 2020.
VIDEO and OTT
- There’s a rumor doing the rounds that Comcast is in talks to acquire free video service Xumo. Xumo has multiple US distribution partnerships that already include Comcast but also T-Mobile and LG and has a reported ~5.5MM US users but reach to ~20MM users according to their fact sheet (PDF link). Worth keeping in mind that Comcast’s NBC Peacock service is due to launch in April 2020.
- for the first time, Netflix released a breakdown of subscriber numbers by regional market. Detailed in an SEC filing, subscriber numbers by region as of Sept 2019 are as follows North America 67.1MM, EMEA 47.4MM, LatAm 29.4MM, and APAC 14.5MM. The full Netflix SEC filing is worth a read as it also has net subscriber adds, ARPU, and revenue by quarter (and historically back to 2017).
- if you’re wondering how Disney+ is doing, Apptopia reports that the Disney+ App has been download 22MM times globally (85% US). This number is mobile-only and excludes smart and connected TVs. You can view the Apptopia Disney+ report here (PDF link and registration may be required). Apptopia also notes that Disney+ is having a halo effect on Hulu and ESPN.
- video advertising platform Eyeview is shutting down after running out of cash. The company ceased operations at the end of 2019.
eSPORTS and GAMING
- Facebook acquired PlayGiga, a Madrid-based cloud gaming startup for ~US$78MM. The deal has been confirmed on the PlayGiga website. PlayGiga offers a Netflix-style cloud subscription service for games without the need for the end-user to have traditional gaming hardware.
- it is reported that the FTC is considering an injunction to stop Facebook from integrating Facebook, Instagram, and WhatsApp messenger services.
- YouTube has sought clarification from the FTC on what COPPA compliance rules mean for content creators, specifically on how to define “the difference between what’s child-directed content and what’s not”. The FTC has published some guidelines, but reading through the comments on the FTC website, creators want a simple set of rules to follow.
PRIVACY, TRUST, and SAFETY
- Spotify has joined others in pausing political advertising on the platform. The policy comes into effect in early 2020.
- there have been no changes in Facebook’s position on political advertising, but it has published a position on the 2020 US Census. Facebook will ban posts from misrepresenting when and how the census occurs, who can participate and more. The Facebook census policy also applies to politicians.
- the New York Times has an excellent piece on mobile location data tracking and the inherent privacy and security challenges. Expect more articles like this over the coming year from the New York Times Privacy Project unit.
- in other great reporting, there’s a story on the Verge about YouTube content moderators and the personal toll it takes (including PTSD). Warning, the story is disturbing and confronting but an important read because it demonstrates that for all of the promises of AI and Machine Learning people are an important part of the solution and deserve more care, support, and respect for what is an incredibly difficult job.
- Facebook’s promised Oversight Board fell short of the goal of announcing board members at the end of 2019. Facebook provided some context for the oversight board delays in a blog post including that it has committed US$130MM to fund the board (and associated operational costs) for the first 6 years.
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Have a great week and start to the year.
PS. something to make the start of the year a little easier, a popular old school comic “The Far Side” now has an official website that is worth checking out (you’ve probably seen the comics before in countless presentations).