FTC – Page 36 – Digital Destiny

Report on online ad market: "DoubleClick owns the head and Google owns the tail"

A new study conducted in January 2008 by Attributor and Compete shows that [excerpt]:

DoubleClick and Google dominate overall market share capturing 35% and 34% of unique users, respectively.
DoubleClick owns the head and Google owns the tail. For sites with over 1MM monthly unique users, Doubleclick has a 48% share, a 3x advantage over 2nd place Yahoo. For sites with less than 100k monthly unique users, Google has an 8x share advantage over 2nd place MSN…

The GoogleClick combination is an ad-serving juggernaut.

See this discussion as well from eMarketer on the study. Search Engine Journal also covers it.

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CDD Publishes new report on widgets, third-party apps: &quot;The Facebook Economy&quot;

My CDD commissioned a report from investigative journalist Adam Mayle that examines Facebook and the growing universe of third-party applications. The report, available via here, examines some of the data collection and privacy issues from these Facebook-related services.

Here’s a short excerpt: “But while this platform has benefited many, it raises concerns about user privacy. Because of their deep integration into Facebook, developers have extensive access to user information, but it is often unclear if, when and how they exploit this data. This situation is perpetuated by Facebookâ€™s unwillingness to regulate the widgets that operate on the site. As a result, users often have no idea who is collecting their data, how information is obtained as one interacts with these applications and how such data â€“ even so- called not non-personally identifiable information â€“ is subsequently used. By eschewing liability and placing the burden of responsibility on developers to police their own applications, Facebook unnecessarily exposes its users to cyber-threats like adware, malware and hackers. In many ways, Facebook has created a
dynamic social network, but because of the practices that it has adopted, it needlessly places the privacy and security of its users in harmâ€™s way.”

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TV advertising, as we discussed in our book, is going interactive. The same privacy problems we now have with online–and will also have with mobile–are being migrated to television. Here’s an excerpt from a trade story on a meeting just held by the advertising industry to discuss interactive and highly targeted TV commercials [our emphasis]:

…Google executive Dan Gertsacov demonstrated the latest iteration of the search giant’s so-called “Goolge TV Ads” program, which is [sic] marries an online, auction-based system for buying TV advertising with Google’s methods for analyzing the clickstream data produced by TV digital set-top devices to give advertisers and agencies the ability to buy and evaluate TV the way they would online search.

The first iteration of the system enabled advertisers to buy TV time based on networks and dayparts. The iteration shown at Carat Wednesday revealed that advertisers and media buyers can now procure TV advertising time based on key words or terms, much the way they would buy online search.

A computer laptop marketer, for example, can now type in the word “laptop” and find a schedule of TV shows referencing computer laptops that they might place ads into.”

source: Carat Meeting Reveals Addressable TV Roll Out, Google ‘Key Word’ TV Buying System. Joe Mandese. Media Daily News. March 27, 2008. reg required.

PS:Â Here’s another addition.Â Google will track and analyze targeting done via TV and its impact online [excerpt]:

“Both [Michael] Steib and [Dan]Gertsacov spoke about Google TV Ads’ ability to offer insight into how a campaign functions simultaneously on TV and online. Steib mentioned the potential for gauging what transpires online–with site visits and transactions–soon after a TV spot runs.”

source: Google Crawls Stations, Tells Broadcasters ‘TV Ads’ Makes Good AdSense.Â David Goetzl.Â Media Daily News.Â March 28, 2008

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Simpson, Thatcher &

Here’s an excerpt from an article in GCP, the “Online Magazine for Global Competition Policy” by Peter C. Thomas, entitled “Lifting the Fog: Google/DoubleClick Demystified.”
“In the end, both the FTC and the Commission cut through the fog of the complaints surrounding the proposed merger to get to the right answer, namely that Google and DoubleClick operate in different, already competitive markets, and that their complementary services, when combined, will not harm competition in any relevant market.”

But readers should follow the asterisk next to Mr. Thomas’s byline, which reads [our emphasis]: “âˆ— The author is the Managing Partner of Simpson Thacher & Bartlett LLPâ€™s Washington, D.C. office…Simpson Thacher represented Hellman & Friedman and DoubleClick in the acquisition by Google.”

We love objectivity!

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CEO from NebuAd demonsrates why New York, other states and Feds must protect consumer privacy on digital networks

We raised concerns about NebuAd last November. The growing use of behavioral targeting collection of data via ISPs requires immediate intervention by policymakers. Thanks to an article written today by NebuAd’s CEO, there’s more evidence supporting a compelling need for policymakers to act and protect consumers.
Here’s an excerpt [our emphasis]: “Web-wide behavioral advertising
This is the type of solution being offered by my company, NebuAd, as well as others, such as Adzilla. The web-wide behavioral advertising companies are able to leverage a large proportion of user surfing habits and their searches. So while portals such as Yahoo may collect information on a fraction of user surfing behavior, web-wide behavioral advertising companies are able to observe most of a user’s surfing behavior. Having such rich information allows companies in this space to build much larger, and define more meaningful audience segments, which in turn will enable advertisers to tailor their offerings to their specific desired audiences.

Moreover, having instant access to user surfing behaviors means that profiles can be developed quickly — really quickly. Web-wide behavioral targeting can develop detailed profiles in a single surfing session, something it would take “traditional” BT players weeks or even months to do. And as profiles are developed almost instantaneously you get a clear picture of what the user wants now — not what he was interested in a while back. Ultimately advertisers want results, and this means they need to reach web users with a relevant ad at the exact moment they are in the market for their goods and services.”

source: “3 Factors Improving BT’s Aim.” Bob Dykes. imediaconnection.com. March 20, 2008

Big Ad Agency Expectations: Google will “leverage” and “combine” with DoubleClick’s data

From an interview published March 17, 2008, via paidcontent.org, with Ogilvy’s chief digital officer (excerpt): “Google and DoubleClick have been partners with Ogilvy for a long time. Half of our clients are on DoubleClick ad serving platform and obviously, weâ€™re buying a lot of media from Google, in the form of keywords. So both continue to be key partners to Ogilvy – as are Yahoo and MSN. From an industry dynamic, itâ€™s going to be interesting to see how Google can leverage the data that DoubleClick has and combine that with the search data to further optimize the display media.”

What AOL’s Proposed `Privacy Penguin’s’ Won’t tell You (or, this campaign needs to go into turnaround)

Time Warner’s AOL division needs to reconsider its forthcoming campaign that will use cartoon penguins to inform users about data collection. I have been told, by the Penguin Committee for Honest Disclosure, that they would like Time Warner and AOL execs to address concerns about consumer privacy seriously. Humor is fine–so is candor. So to help Time Warner rework its upcoming campaign, here’s some of the language its Advertising.com is using to pitch EU marketers about its behavioral targeting “solutions.”

“Behavioural Targeting is the most dynamic way of reaching the right audience online. Using our Behavioural Network and LeadBack technology, we can target a pre-defined audience segment based on user behaviour on the internet.

There are a number of different ways we can create these audience segments:

* Advertiser LeadBack
We are able to target users across our network based on their behaviour on advertiser websites (e.g. partial conversion, abandoned shopping cart).
* Audience LeadBack
We are able to target users across our network based on their behaviour on publisher websites (e.g. viewing product review sites).
* Search LeadBack
We are able to target users across our network based on their search engine activity.
* Creative LeadBack
We are able to target users across our network based on their interaction with ads served outside the Advertising.com network.

By establishing certain user traits or demographics within an audience we are able to target those individuals with the most relevant advertising or simply reach those same users in a different environment…”

Google’s target as it absords DoubleClick: “big world of brand and display dollars”

One phase of the regulatory review is over, but the effort to protect privacy online continues. The work of EU and U.S. privacy and consumer groups during the merger encouraged officials on both sides of the Atlantic to more closely examine online data collection practices of Google and others. We believe that EC privacy commissioners will continue to press for more effective safeguards. We were told that the EC competition authorities met resistance to their merger analysis from other officials concerned about privacy and media diversity. In today’s digital media era, the diversity of content creation, protecting privacy, and the competitiveness of the online ad business are intertwined.

We intend to keep our Google watch (along with our focus on the online ad industry). Today’s Advertising Age article on the Google/DoubleClick merger gives a sense of where the search leader is headed [excerpt. our emphasis. subscription required]: Google executives were meeting with reporters in their New York office this morning when the official news came through. “There’s a big world of brand and display dollars we haven’t been as aggressive in or played in,” Penry Price, VP-North America sales for Google, said at the meeting… “We want to build on top of that platform [DoubleClick’s] and create next-generation tools to work with marketers and agencies to have an end-to-end solution from planning to reconciliation”….”I think would we be disappointed in 2008 and 2009 if we don’t have a very significant presence in the display marketplace,” Google President-Advertising Tim Armstrong said yesterday at the Bear Stearns Media Conference.

PS: Here’s what JP Morgan said, in part, about the consequences of the Google/DoubleClick merger in a report released yesterday: “Better targeting opportunities. Google will now have behavioral data from search, email, video, and web usage on network sites. We believe this will allow the company to provide much better ad-targeting, leading to increased CPMs on DoubleClick sites.”

The EC approval of Google’s DoubleClick takeover

Statement on the EC Decision on Google/DoubleClick
Jeff Chester, Center for Digital Democracy

By failing to impose safeguards, EC regulators have helped strengthen a growing digital colossus that will now be in a dominant position to shape much of the global future of the Internet and other online media. The EC [DG Comp] appears to have embraced the FTC’s flawed analysis of the online ad market. It represents the failure of antitrust regulators to understand and respond to the growing consolidation of control over online ad delivery, data collection, and the funding of content. This decision will have profound and unfortunate consequences for the Internetâ€™s evolving role as a democratic communications medium.

EU and US antitrust regulators have also perversely set the stage for Microsoft’s goal of acquiring Yahoo!, furthering more concentration of control in the new media sector. Instead of ensuring competition, DG Comp and the FTC have literally paved the way for the emergence of a global digital duopoly over online advertising (which is the principal way online content is funded). By permitting Google to dramatically grow in clout, regulators will have to likely enable the further growth of a # 2 competitor to Googleâ€”which will be Microsoft.

US and European policymakers must reform the antitrust process to reflect the realities of the digital market era, where competition, data collection, and content creation are seamlessly intertwined. In todayâ€™s digital marketplace, the company that controls the most data about consumers and has the global reach to connect to them raises both anticompetitive and privacy concerns. An antiquated and piecemeal antitrust approach fails to protect citizens, consumers, and competition.

The Center for Digital Democracy, which opposed the Google/DoubleClick merger in both the U.S. and in the EC, will continue to press policymakers to play a more responsible forward-thinking approach to competition and consumer protection for online and interactive media.

Google+DoubleClick will = “the dominant player in behavourial targeting”

No, thatâ€™s not just CDD and other privacy advocates warning the public about this. Itâ€™s a quote from a panel held this week in Brussels by the â€œconservative think-tank, the Centre for the New Europe.â€ Hereâ€™s an excerpt of a story that quotes panelist Wayne Arnold from the Institute of Practitioners in Advertising (IPA) and digital ad agency Profero: â€œGoogle is increasingly becoming the dominant player in the digital advertising space in Europe. If the Double Click acquisition goes through, this will provide Google with unrivalled access to consumer data and a foothold in the display media space – an area in which until now they have been relatively weak.â€

The next big thing in online advertising is behavioural targeting, said Mr Arnold. This is a technique whereby advertisers increase the effectiveness of their campaigns by using data collected from someoneâ€™s web-browsing behaviour â€“ that is to say, what sites they have been to and what things they have searched for.

The advertiser then uses this information to deliver adverts tailored to the perceived interests of the websurfer. The The Double Click deal will make Google â€œsuddenly the dominant player in behavourial targeting,â€ said Mr Arnold.â€

source: “Google-Double Click merger raises privacy concerns.” Leigh Phillips. Euobserver.com. 3/7/08.