Jeff Chester Reports on Digital Media and the Public Interest
excerpt: “The idea of location-based advertising, in which advertisers use the location of mobile phone user to send targeted advertising, also won support from Google chairman Eric Schmidt.
He used the example of how an advertiser of fast-food could target a user with advertising when he or she was near a restaurant.”
from: China’s mobile network: a big brother surveillance tool? AFP. January 27, 2008
When you can get the online ad industry to write your copy, it makes the work at the FTC and the European Commission so much easier! Here’s an excerpt from a revealing imediaconnection article entitled “Targeting Tips for a Converged Media World.” [Jan. 30, 2008]
“In days past, audience segmentation was based solely on demographic and contextual targeting information, which allowed advertisers to promote their products or services to a group of potential consumers based on their gender, age and other fairly unsophisticated, generic characteristics. In the online world, consumers now essentially determine their own segmentation based on individualized habits, determined through behavioral targeting…. Behavioral targeting…is also an additional way for marketers to target users further down the purchasing funnel and helps marketers better predict how users will act… Marketers will be able to track individuals or user clusters across their favorite TV shows, travel habits through their car’s GPS or obtain their video game proficiency through in-game advertising… As users age and change their personal preferences, behavioral targeting can change with users’ habits and compensate accordingly…With marketers able to include interactive components into traditional media outlets while infusing behavioral knowledge and targeting, advertisers must create messages that can be delivered across all platforms. For example, we could see mobile ads that use interactive elements if marketers know the behavioral cluster exhibits a preference for interactive media.”
Yesterday a reporter sent me the following email sent from the Google PR shop. Instead of calling for responsible policy safeguards to protect consumers, Google is distributing booklets, videos and other self-help materials (in other words, let the user beware). It’s not surprising that Google is on a PR effort to quell the growing calls for real privacy protection. But they are not living up to their own ideals if they fail to really be more candid about the conflicts they have with a business model entirely based on data collection and targeted marketing.
Here’s the email:
“From: “Adam Kovacevich”
To: undisclosed-recipients:;
Sent: Monday, January 28, 2008 12:23:11 PM (GMT-0500) Auto-Detected
Subject: Happy Data Privacy Day
Okay, okay, so you can be forgiven if you didn’t realize today was Data Privacy Day here in dear old North America. At Google we’ve been doing a lot lately to educate our users about our privacy policies (particularly the launch of our Google Privacy YouTube channel ), but we figured today was a good day to unleash a few more education efforts. To wit:
• A brand spankin’ new video on the YouTube channel explaining how cookies work: http://youtube.com/user/googleprivacy
• A new booklet ( http://64.233.179.110/blog_resources/google_privacy_booklet.pdf ) that gives our users an in-depth look at our privacy practices and approach. This should be a particular good resource for you journos too.
• We’ve co-sponsored the creation of educational materials ( https://www.privacyassociation.org/images/stories/pdfs/DPD08_TeenPrivacyOnline_slides.pdf ) on teen online privacy for parents and educators.
• Our senior privacy counsel Jane Horvath is today joining legal scholars, privacy professionals, and government officials from Europe and the U.S. at an international data privacy conference being held at Duke University in Durham, North Carolina.
For more on all of this, check out our blog post:
http://googleblog.blogspot.com/2008/01/celebrating-data-privacy.html
or background from the Search Engine Land blog:
http://searchengineland.com/080128-095148.php
Adam
—
Adam Kovacevich | Sr. Manager, Global Communications and Public Affairs | Google
1101 New York Ave NW | Second Floor | Washington, DC 20005 “
The Internet Education Foundation (IEF) plays an unfortunate gatekeeper role for the Congressional Internet Caucus. Jerry Berman serves as the chair of both the Center for Democracy & Technology (CDT) and the IEF (the two groups also have board members in common). IEF’s most high-profile project is the Advisory Committee to the Congressional Internet Caucus, which organizes events for Congress on new media issues. This Wed. (Jan. 30), the group is holding its annual “State of the Net” event. Such congressional meetings really require a group independent of the special interests–especially on a topic so important as the role digital communication plays in a democracy. The event has been structured to be a tame affair–there will be little reality discussed about the real state of digital communications (since groups funding the congressional meeting–including Verizon, Google, Microsoft, AT&T–wouldn’t feel generous in their future giving if they faced a serious critique).
Take the panel on social networks, entitled: “Social Networking Privacy: An Oxymoron?” Such a title fits into the current interactive ad industry/MySpace/Facebook lobbying frame that claims young people don’t care about protecting their personal data. Social network users, especially teens, are being encouraged to place all their personal details on such sites without real safeguards. That’s why it’s time for new privacy policies that provide serious privacy protections on social networks. We urge everyone to read the recent EU paper on the subject, which should help galvanize the public into action. A responsible society should act swiftly to protect privacy online, especially for its youth. As the debate builds on social networks and privacy, it will be vital to inform policymakers about the real story.
We don’t want to pick on Google–almost everyone else in the interactive advertising business has similar goals regarding unleashing new media to promote marketing. But Google’s evolution as a powerful force shaping the future of media requires attention and public debate. Here’s an excerpt from Online Media Daily covering what a “Google TV Ad” exec said to industry honchos last week [our emphasis]: “THE FUTURE OF TV ADVERTISING will probably be a lot like current state of the online advertising: aggregated advertising networks, behavioral targeting, and automated buying systems enabling small, “long-tail” advertisers to compete alongside the TV industry’s biggest marketers and agencies… “We have built technology and have an infrastructure that the industry can use to connect all those hundreds of thousands of advertisers with all the permutations that come,” Mike Steib, director of Google TV Ads, said in the search giant’s latest pitch to the TV industry that it can help it unlock underutilized, under-measured and undervalued advertising inventory, especially millions of local cable advertising avails that have become the ghetto of the TV advertising marketplace.
By aggregating the disparate local cable advertising in ways that deliver meaningful sub-segments of viewers, Steib said Google TV ads program is able to create audience mixes that likely would have higher advertising value than their remnant avails currently have on their own, and which theoretically could compete in value with some of the TV industry’s most premium network TV inventory.
“There’s all these opportunities to drive sell out,” he said, “much, much closer to 100% and to take the CPMs up significantly when you start matching the right advertising with the right audiences.”
And, as the late Kurt Vonnegut Jr. might say, so it goes.
Why let a European Union Parliamentary inquiry (okay, seminar!) into Google’s data collection system and its proposed acquisition of uber digital marketer DoubleClick spoil interactive marketing dealmaking? That’s what Google obviously believes. According to today’s Guardian, Google CEO Eric Schmidt announced yesterday a new alliance with Publicis, the Paris-based advertising conglomerate. Publicis is the fourth largest advertising company in the world. One of its digital marketing subsidiaries–Digitas–represents such clients as American Express, Bank of China, General Motors, IBM, Miller Brewing, Nestle, and P&G. In the U.S., Publicis works with Coca Cola, Consumer Electronics Association, Denny’s, General Mills, Glaxo Smith Kline, etc.
Mr. Schmidt articulated Google’s vision for its work with Publicis and other marketers (before heading off to Davos). It is, wrote the Guardian, “about building a platform for targeting hundreds of millions of consumers with hundreds of millions of tailored ads in the digital marketplace.” Mr. Schmidt’s new partner–Maurice Levy of Publicis–added his own view about how the two companies would benefit from the alliance. It would foster “building a relationship between a brand and its consumers through an emotional link.”
PS: Via Online Media Daily’s coverage: “… Levy and Schmidt said the alliance involved the sharing of proprietary technical knowledge, as well as insights about advertising and media planning and buying, and involves the exchange of personnel between the two companies…Google has independently been recruiting Madison Avenue expertise at a rapid clip, hiring hundreds of former agency media planners, buyers and account planning executives to help build out a burgeoning advertising and media services organization.”
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We have long admired the Writers Guild of America–it’s been an important voice of conscience for an industry long interested more in bottom-line and politically expedient results than fulfilling its democratic and creative potential. The WGA played a key role alongside public interest media groups during the 2001-2003 battle fighting the Federal Communications Commission’s plans to further consolidate the broadcast, cable, and newspaper industries. Now the WGA has assumed an important leadership position for the “creative community,” especially in regards to the rights and royalties that should be shared from digital distribution. Everyone understands that the entertainment and news business has already fundamentally changed. The time to ensure fair participation and opportunity is near the beginning of this transformation–not what the Directors Guild of America did by postponing a serious approach to the issue for three years.
We hope the members of the WGA will fight on, even though we know there are serious hardships. As always, the media owners are pulling a fast-one, hoping the writers will get scared (as many did during the Blacklist era).
The largest media companies working in television and films have been on a buying spree, acquiring digital marketing and advertising companies. They have aggressively moved into broadband, mobile communications, and video games. They have also fully embraced cross-platform strategies (digital upfront’s, for example) that are another sign of fundamental changes in the industry. The joint News Corp./Fox and GE/NBC U broadband video service Hulu.com is a good example of how the industry is responding to the changing audience and distribution models (that includes deals with Comcast, Time Warner, Microsoft and Yahoo!). Don’t forget the buying and deals involving emerging markets in Asia. Here’s just a very cursory, thumbnail of some of the deals. We hope WGA won’t place its strike in “turnaround.” Someone has to stand up (and while we are on the subject, the mainstream news media have done a horrible job explaining the issues involved in the strike. Nor have the networks identified their own conflicts when their news divisions have covered the story).
Time Warner’s digital acquisitions (2007): Tacoda, AdTechAG, Third Screen Media, Quigo.
News Corp, Strategic Data Corp (permitting the expansion of its MySpace, IGN and other Fox Interactive Media properties to engage in advanced data collection and hypertargeting users); Photobucket; Flektor; 2 IGN Entertainment, MySpace, Scout Media (and don’t forget recent creations such as FIM Labs, FIM Mobile and FIM Stations Group). Jamster/Jamba (a joint venture).
Viacom: Neopets, Sportsline.com, Atom Entertainment, IFilm, RateMyProfessors.com, Harmonix Music Systems, XFire, Y2M (and don’t forget Viacom’s cross-platform ad and content sales operation).
NBCU: Oxygen Media, iVillage, Sparrowhawk Holdings (also remember Hulu).
Disney: Pixar, Club Penguin, Minds Eye Productions, Living Mobile, iParenting Media.
Sony Pictures: Grouper, You Tube Channels, and see: Sony Pictures Mobile, Station.com
PS: We like this description via Fox Interactive Media of its businesses (our emphasis): “FOX Interactive Media (FIM) provides an integrated network of sites that collectively offers more than 200 million worldwide users socially rich media experiences centered on entertainment, news, information and self-expression. FIM’s online sites include MySpace (the largest networking destination in the world), IGN (industry leading video game website), FoxSports.com, AmericanIdol.com, Rotten Tomatoes, Askmen.com and Photobucket along with numerous other online destinations. FIM is a cutting edge internet company with a track record of explosive growth both through internal development and strategic acquisitions. FIM is located in Beverly Hills, CA.
Fox Interactive Mobile is charged with overseeing the mobile extensions of FIM’s online assets, including FOXSports.com, IGN.com, MySpace.com, MyFOX.com, AskMen.com and others. The mobile operations team is responsible for managing diverse branded mobile product offerings on a global basis, spanning the wireless product spectrum from WAP to video.”
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Following press reports of a new questionnaire sent by the European Commission Competition Directorate, we thought we should place here what we believe was the initial survey sent. Eventually, Congress and others will need to investigate how well the FTC conducted its own review of the deal. Frankly, several parties–including commissioners–spoke of their concern that the agency’s loss in Whole Foods and other cases made it more difficult to confront the Google takeover of DoubleClick case. This is an ongoing story. But for now, here’s the questionnaire:
Case COMP/M.4731 – Google/DoubleClick
Questionnaire to Customers 1
Deadline for Reply: 18/10/2007
Google Inc. (“Google”) notified to the European Commission its intention to acquire control of DoubleClick Inc. (“DoubleClickâ€) by way of purchase of shares. The two parties to the merger Google and DoubleClick are hereinafter collectively referred to as “the partiesâ€. Both are active in the online advertising industry.
Pursuant to the Merger Regulation , the Commission is required to assess the operation’s possible effects on competition within the common market. To this end, the Commission needs to gather relevant information from the parties to the operation as well as from other market operators, such as competitors and customers.
Therefore, your replies to the following questions as well as any other opinion on the effects of the operation you might consider relevant, are of key importance to the investigation. We should also be grateful for any additional remarks you may wish to make relating to the proposed concentration. If you consider that a particular question is not relevant, please indicate this and explain why. Please reply to this questionnaire on behalf of all companies belonging to your group.
When you reply to this questionnaire, please provide TWO versions of your reply: (i) a CONFIDENTIAL version; and (ii) a NON CONFIDENTIAL version which excludes business secrets or other confidential information.
In accordance with the Merger Regulation and in the light of the deadlines which the Commission must respect following the notification of the case, the Commission wishes to have your reply by 18/10/2007.
If you have questions of administrative nature or wish to receive this questionnaire in electronic format, please contact Ms Györgyi Nyiregyhazi (Tel.: +32 2 29 85327, e-mail: gyorgyi.nyiregyhazi@ec.europa.eu) clearly indicating the reference: M.4731 Googkle/DoubleClick – Questionnaire to Publishers.
If you have any further questions on the substance of this request, please contact Mr Bertrand Jéhanno (Tel.: +32 2 29 91048, e-mail: bertrand.jehanno@ec.europa.eu), Mr Carl-Christian Buhr (Tel: +32 2 29 86 033, e-mail: carl-christian.buhr@ec.europa.eu), Mr Flavien Christ (Tel: +32 2 29 90931, e-mail: flavien.christ@ec.europa.eu,), Mr. Peter Eberl (Tel: +32 2 29 60783, e-mail peter.eberl@ec.europa.eu), Ms Vera Pozzato (Tel: +32 2 29 93012, e-mail: vera.pozzato@ec.europa.eu).
Thank you for your help and co-operation.
A. General questions
Please give the contact details of the person responsible for replying to this questionnaire
Company:
Contact person: Phone:
Position: Fax:
E-mail:
Address:
Country:
Company web-site:
Please give a brief description of your organisation, of its size and of your activities. If your company is a subsidiary please indicate the group to which it belongs to.
Description of your organisation:
Please indicate the countries within the EEA in which you are active as online publisher (website owner):
B. The provision of display ad serving, management and reporting infrastructure technology
The provision of display ad serving, management and reporting infrastructure technology could be distinguished according to whether services are provided to advertisers (and agencies) or to publishers (including self-provisioning).
The Commission understands that advertisers create advertisements and upload them onto the advertiser-side ad server. Once a website publisher has agreed with the advertiser (directly or through an ad network or ad exchange) to run the ads on its website, the publisher enters the campaign terms of the ad (location, price, targeting criteria) into the publisher-side ad server. There is then a relationship between the publisher-side ad server – which records the “impression” generated by the user’s visit of the web site and determines the advertiser to call – and the advertiser-side ad server – which chooses the appropriate ad to deliver on the web page. The relationship between the two servers also enables the advertiser to obtain information relating to the user’s online behaviour in the context of the placed ad via browser cookie technology.
1. What is the value of the online advertising revenues generated by your website(s) in Europe?
2. Through which channels do you sell advertising space on your website/s?
Direct sales: YES/NO
And/or
Brokers, intermediaries, ad networks, ad exchanges: YES/NO
3. If you use both the direct channel and the indirect channel (ad network/ad exchange), please indicate (broadly) what % of your online revenues originate from the direct channel.
4. Do you foresee that direct sales of online advertising will decrease in the future in favour of intermediation through ad networks and ad exchanges?
5. Do you foresee that numerous ad networks and ad exchanges will be able to survive in the near future (2-3 years)? Please briefly elaborate.
6. If you use a 3rd party ad serving supplier (e.g. DoubleClick, OpenAdstream, AdManager…): if the price of 3rd ad serving services was to raise by 5-10% (all else equal) would you switch part of your inventory to an integrated network like Google AdSense?
7. Do you consider the cost of switching ad serving technology supplier to be high / moderate / low?
8. If you use more than one supplier of such technology/services, please describe briefly the advantages and disadvantages of such a solution compared to a situation in which only one supplier is used. Please also indicate why your company chose to use more than one supplier for this technology/services.
9. If you only have one supplier for this particular product/service, do you consider it possible/usefull using another supplier for a comparable product/service at the same time? If yes, please name these other possible suppliers. If not, please explain the reason why you choose single homing (e.g. exclusivity clauses, cost saving, quality of service …).
10. Please name other providers of display ad serving, management and reporting infrastructure technology that you consider as competitors of your provider/s at EEA level.
If you sell advertising space through direct sales
11. Which provider/s of display ad serving, management and reporting infrastructure technology is directly supplying your company?
12. Have you ever experienced a switch of supplier for this particular product/service? YES/NO
If yes, please:
explain the reason why you made such experience:
provide the name of your former supplier:
the name of the replacing supplier:
the cost caused by the switch:
the time it took to complete the switch
13. What is the % represented by the cost of ad serving in the total revenue generated by your advertising space? Please provide broad estimates.
If you sell advertising space through brokers/intermediaries/ad networks/ad exchanges
14. Which provider/s of display ad serving, management and reporting infrastructure technology is/are indirectly supplying your company?
15. Have you ever experienced a switch of supplier for this particular product/service? YES/NO
If yes, please:
Explain the reason why you had to switch:
provide the name of your former supplier:
the name of the replacing supplier:
the cost caused by the switch:
the time it took to complete the switch:
16. If you use the indirect channel, what is (a) the % represented by the cost of ad serving in the total revenue generated by your advertising space; (b) the % represented by intermediation fees in the total revenue generated by your advertising space? Please provide broad estimates.
17. If you multi-home, why have you become member of several ad networks?
C. Effects of the merger
18. According to you, is DoubleClick’s large publisher customer base an advantage for the quality of services offered by DoubleClick to publishers? In other words, is there a direct benefit to a publisher to use an ad serving supplier with a larger publisher base? If so, please briefly describe the benefit(s) (e.g. does the ad serving service improves the monetization of inventory if the ad server processes the data on user behaviour accross numerous publishers?).
19. If Google and DoubleClick were to merge, do you consider that integrated networks like Yahoo! (with RightMedia) and Microsoft (with aQuantive) would be able to provide strong competition to Google/DoubleClick? Please briefly elaborate.
20. Would you consider open source ad serving software as a viable alternative to commercial ad serving software? If so would you consider it suitable, in conjunction with a standalone ad network, as an alternative to Google’s AdSense? Please explain.
21. What are, in your view, the main effects of the proposed operation on:
a) your company?
b) the markets for (display and text) ad serving, management and reporting services for publishers?
c) the prices of (display and text) ad serving, management and reporting services for publishers?
Please give reasons for your answers.
22. Do you have any other comments that you wish to bring to the Commission’s attention?
Thank you for your assistance!
Please do not forget to add a non-confidential version to your response.
As a brief companion piece to Ken Auletta’s article on Google in the current issue of The New Yorker magazine (The Search Party), this may be of interest. Google’s goal is ultimately to be of service to advertisers and marketers; that’s how it makes 99% of its revenue. There’s a disturbing lack of candor from Google about the conflicts they have. One the one hand, they are (getting PR for) promoting responsible practices such as energy sustainability. But on the other hand, they are using all the company’s incredible resources to push the interactive marketing and selling envelope, including the sales of automobiles. Here’s excerpts from Google advertising sales job openings related to the car and truck industry:
1. The role: Industry Head, Automotive – London
As a Google Automotive Industry Head, you’ll be working with those who produce, market or sell products or services related to cars, trucks, boats or other transportation vehicles. This includes original equipment manufactures, third-party websites, dealers and after-market parts and accessories companies. This is a highly consultative position that reports directly to the Automotive Industry Leader. You’ll be responsible for presenting the team’s strategy and managing a team of experts to increase sales on a national level. Focusing on building strong relationships at the highest possible level, your goal is to help your automotive clients get as many of their marketable assets online in an affordable and measurable way. You’ll combine exceptional Automotive knowledge, deep industry and marketing agency relationships, compelling communication/presentation skills and inspired prospecting/analytical abilities to develop and close new business as well as grow existing business.
Responsibilities:
Requirements:
2. The role: Account Strategist, Automotive Vertical (Detroit)
As a Google Automotive Account Strategist, you’ll work primarily with large automotive clients and agencies. Most of these companies operate multiple sales channels, work with several manufacturing partners and always look to increase sales volume and efficiency. This is a creative position that calls for a strong affinity for the craft of language and a fondness for consulting closely with the auto clients. You’ll distill the essence of our clients’ products and services into targeted keyword lists and text advertisements that connect our advertisers with customers. You will also collaborate with our Sales and Operations team to work closely with clients to maximize the performance of these highly targeted ads.
3. [based in Santa Monica, CA] The role: Account Strategist, Automotive Vertical.  As a Google Automotive Account Strategist, you’ll work primarily with large automotive clients and agencies. Most of these companies operate multiple sales channels, work with several manufacturing partners and always look to increase sales volume and efficiency. This is a creative position that calls for a strong affinity for the craft of language and a fondness for consulting closely with the auto clients. You’ll distill the essence of our clients’ products and services into targeted keyword lists and text advertisements that connect our advertisers with customers. You will also collaborate with our Sales and Operations team to work closely with clients to maximize the performance of these highly targeted ads…
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We urge readers to view this very excellent 50-minute 2006 VPRO documentary on Google. “Google Behind the Screen” addresses many important issues, including open access to information and privacy. Brewster Kahle of the Internet Archive is especially thoughtful. Via YouTube.
It’s also interesting to see how so many Google executives and staff don’t want to acknowledge the conflicts the company has as its online data collection and interactive ad business evolves.
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