An Ad Industry Perspective on a Google “Monopoly”

via NMA [sub required]:

Letters: Google fails to answer monopoly concerns

“Google UK MD Dennis Woodside failed to address the concerns of Microsoft and much of the online industry that it’s creating a monopoly within the online ad industry (NMA 19.04.07).

First, it’s no use his referring to the fact that online has only 11% of the overall ad market. That’s irrelevant as we’re only concerned about a monopoly being created within the online ad market.

Second, he says advertisers can choose to place their campaigns elsewhere. But nearly all large newspaper and magazine publishers use DoubleClick ad serving products, so Google will have complete control, or at the very least will be able to see who’s spending what with who down to campaign level.

Also, DoubleClick has at least 50% of the agency third-party ad serving market. Now that Google has acquired this, it can dominate the online display market within the media agency area as well as search.

The key argument is that there aren’t “plenty of opportunities”, be it in online display media or technology, to avoid Google’s spreading tentacles.”

Phil Nott, sales director, Adrevenue
NMA magazine | Published: 07.06.07

Behavioral Targeting: Identifying "Individual" Consumers

Here’s something we’ve read aloud to policymakers and others this week. “However, what makes recent developments in behavioral targeting so exciting is that marketers are now better able to identify individual customers based on their expressed (and unexpressed) interests and desires just by watching them as they visit web sites and do what it is they do.”

from: Fishing From a Barrel: Using Behavioral Targeting to Reach the Right People With the Right Ads at the Right Time. Rob Graham. Learningcraft Press. 2006.

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Google and

excerpt: …RSS technology company FeedBurner is guaranteed loads of extra consumer and publisher data, along with new strategies for monetizing and optimizing its delivery systems… WITH THE ACQUISITION OF FEEDBURNER last week, Google secured a wealth of media syndication analytics, and access to a distribution channel with latent ad opportunities.

“From the advertising side, there’s a lot of room ahead in terms of monetization and optimization, which Google is going to expose us to,” Hill said during a conversation with OnlineMediaDaily on Thursday. “We’ll be learning how to incorporate their analytics and monetization strategies for advertisers.”

Much remains to be learned about RSS users and their consumption habits, according to Hill.

“The way to understand demographics has been to work with publishers, survey their audiences, and try to get representative sample sizes,” he said. “Google does some of the same things around AdSense content, so we’ll be able to combine our information and make progress faster.”…

FeedBurner has serviced nearly 432,000 publishers worldwide, according to Dick Costolo, FeedBurner CEO and co-founder. Additionally, the company is delivering 67 million subscriptions per day and counting.

Feedburner Ad Leader on what Google Deal Means.” Gavin O’Malley. Online Media Daily. June 8, 2007

Ad Age article on Googleclick: Capturing $ 8 out of Every $10

excerpt: “One interested party supplied some numbers to Ad Age, estimating that a merged Google-DoubleClick will serve ads representing nearly $8 out of every $10 on third-party websites. That estimate is based on the assumption that in the market of nonsearch ads to third-party publishers, Google is responsible for 29% and DoubleClick 49%.

Another competitor estimated DoubleClick has a 40% share of the publisher ad-serving market and a 60% share of the advertiser ad-serving market…While all the FTC considerations are private in an antitrust case, at stake is the ability of other parties to innovate and enter the online-advertising space, assuring a fair market in which a monopoly can’t drive up prices.”

“String of Digital Deals Leaves Ad World Baffled.” Abbey Klaassen. Advertising Age. June 4, 2007 [sub required]

Google Buys DC Access: Adds Lobbyists with Connections

excerpt: “Google expanded its Washington staff to 13, including five lobbyists, and then scored a victory this week with the hiring of its sixth: Johanna Shelton, senior counsel for telecommunications and the Internet to Representative John Dingell. Dingell, a Michigan Democrat, is chairman of the House Energy and Commerce Committee, which oversees media, telephone and Internet issues….The company last week retained outside lobbyist Makan Delrahim, former deputy assistant attorney general in the Justice Department’s antitrust division, to help win approval. Former Republican Senators Dan Coats and Connie Mack, both partners in the Washington law firm King & Spaulding, began lobbying for Google last year, as did the mostly Democratic Podesta Group. Google staffers include Republican lobbyist Jamie Brown, a former Bush aide whose job included lobbying senators on the confirmations of Supreme Court Justices John G. Roberts and Samuel Alito; and Democrat Robert Boorstin, a former speechwriter for Clinton on national security issues.”

via Bloomberg news

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Google Should Own Up to Privacy Concerns

We believe that Google’s response to our amended complaint to the FTC illustrates a problem with the interactive online advertising market leader: it can’t own up to concerns about protecting individual privacy. In a statement released to reporters yesterday, as noted by the San Francisco Chronicle, Google said that:

(Electronic Privacy Information Center) and other critics have so far failed to identify any practice that does not comply with accepted privacy standards, and their complaints are unsupported by the facts and the law. Google aggressively protects user privacy, and user trust is central to Google’s values and essential to the success of our products.”

Google went on to say that it has discussed privacy issues with several groups, but that the center has so far refused its invitations. The only conclusion, Google said, is that the organization “would prefer not to be informed about the erroneous claims it is making.”

We urge people to read our complaint (PDF) and then ask: why isn’t Google owning up to these issues? Why isn’t Google admitting that current U.S. online privacy safeguards are weak, vague and arcane? Why can’t Google say that the current privacy regime for consumer protection is really `window dressing.’ More to the point, why is Google failing to engage in candor. Isn’t the take-over of the country’s leading online ad firm utilizing profiling technologies–Doubleclick–cause for legitimate concern, debate, and the enactment of meaningful safeguards? Is the failure to admit to the problem due to Google’s earnings being 99% driven from online advertising and data collection?

We think Google’s silence on this question underscores why our work to have Google’s proposed take-over of Doubleclick properly vetted by policymakers and the public is so important.

Google’s Feedburner: Data-Driven (and Big Brand Friendly)

From Mediaweek (excerpt): “Google said that it has reached an agreement to acquire FeedBurner, a Chicago, Ill.-based company that provides a host of RSS feed services for publishers, including the delivery of contextually targeting advertising to RSS readers…Feedburner, launched in 2004, manages thousands of RSS feeds for publishers like Dow Jones as well as dozens of bloggers…Recently, the company launched AdClimate, a product that is designed to make RSS advertising more palatable to mainstream brands by letting them prevent their ads from appearing alongside any objectionable language that appears within an RSS feed…While RSS advertising is still a verdant market, this acquisition also provides Google access to a wealth of information on the habits of RSS users, something that likely made the startup firm that much more attractive to the search giant. In a statement on an official company blog on June 1, officials insisted that Google will protect the privacy of Feedburner users, and instead emphasized the advertising potential of RSS. “…We think we can create opportunities for advertisers to reach their target audiences while maintaining a high quality user experience.”

Source:”Google Nets RSS Provider FeedBurner.” Mike Shields. Mediaweek. June 1, 2007.

PS: Here’s what Feedburner wrote about AdClimate on April 26, 2007 (excerpt):

“Warm Up To a Protected Advertising Climate

Today we announce AdClimate, a new feature of the formidable FeedBurner ad server for blogs and RSS feeds. AdClimate gives marketers and advertisers the power to suppress their ads from being served into content they might deem questionable… In addition to screening a multi-language default list of inappropriate language, advertisers can submit their own list of keywords next to which they don’t want their ad to appear…

In the world of distributed media, brands need to be protected which is why the AdClimate concept has been met with very positive feedback from agency execs across the land.”

And via ClickZ: “The acquisition will give Google access to FeedBurner’s network of 431,171 current publishers to add to its AdSense network…”

Also from Online Media Daily: “FeedBurner has created an effective set of tools,” said Susan Wojcicki, Google’s vice president of product management. In addition to the basic distribution, it offers strong analytics, promotion and monetization capabilities…The deal will give Google AdSense advertisers access to this new inventory… The idea is to integrate FeedBurner publishers deeply into AdSense and to create a highly integrated analytics package tying FeedBurner stats into Google Analytics, Wojcicki said.”

Google Hires former Bush and Hill Official to Lobby for its Merger

As part of its lobbying effort to secure FTC approval of its dramatic expansion, Google has hired a former Deputy Assistant Attorney-General for the Antitrust Division. Makan Delrahim, who served at the DoJ from 2003-2005, helped oversee the DoJ’s work work with international antitrust agencies. Among his duties was to chair “the Merger Working Group of the International Competition Network, the recently created virtual network of antitrust enforcers to develop better global coordination and cooperation of competition law enforcement.” Mr. Delrahim’s also worked as Chief Counsel for the Senate Judiciary Committee under Sen. Orin Hatch. One assumes Google wants to use Mr. Delrahim’s contacts at the FTC and at the European Commission to head-off what should be serious opposition to its take-over of Doubleclick. According to press reports, the new lobbyist has, of course, no qualms about the deal. Bloomberg reports Mr. Delrahim said that “[U]ltimately this is a very robust, dynamic industry. The combination of the two companies will only help create a more efficient system for the online advertising world.” Mr. Delrahim is now in private practice at Brownstein Hyatt Farber Schreck.

We have reached a crucial transition period for digital communications and commerce in what should be a global democratic era. It’s too convenient a rationalization to claim that because your mission is to “organize the world’s information and make it universally accessible and useful” you can ignore concerns about user data protection, consumer autonomy, competition, and related civil society issues.

Google Makes itself Big Brand Friendly, including Video Ads (or,`Waiting for

Excerpts from two recent Ad Age articles [sub required]. First, from “Why Google’s Universal Search Is Brand-Friendly” (Danny Sullivan. May 28, 2007): “With [Google’s] universal search, it’s no longer just 10 matching web pages that show up in response to searches. Instead, the results might include news articles and photos, local listings with a map, book results, images and video… Google’s search results are the bedrock of its success, and any type of nontextual material has been largely restricted out of fear of upsetting Google’s core users… The problem with those pesky pay-per-click ads is they don’t pull in enough money from the big brand advertisers, who prefer flash and gloss over three lines of haiku-style text. Google’s already been experimenting with video ads, both the stand-alone, click-to-play variety as well as in-stream ads in editorial video content. If Google searchers show no adverse reaction to the addition of video to search results, you can expect video ads of both types to follow.”

And from “Google AdSense Launches In-Stream Video Ad Test” (Abbey Klaassen. May 23, 2007): Google has launched its latest video offering to AdSense — advertising in the videos that the network’s publishers air on their sites. Google is testing in-stream ads in video through its AdSense program…Google said it hopes to take what it learns in this trial and use it to figure out what kinds of ads work in videos. It won’t take ads longer than 30 seconds, and viewers can skip ads if they chose. “Just as AdSense adds value to the text content on your website and is useful for your users, we think these in-stream ads in video will add value to publishers’ video content and help to deepen engagement with users watching the videos,” said Google in a posting on its AdSense blog.


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