Publishers focus on subscriptions despite ads growth

Further insights from Digiday’s latest publisher research show where publishers see revenue growth in 2022.  Overall, 75% of publishers expect ad revenue growth in 2022; with 47% expecting subscriptions revenue growth and 47% expecting ecommerce growth.  Whilst it seems obvious that 73% of publishers with established subscriptions businesses are optimistic about subscriptions, not everyone is quite so optimistic.  For instance, only 17% of the respondents that do not have subscription businesses said that they expect subscription revenues to grow this year.

Subscriptions dominance in 2022 is further highlighted by Warc in reference to Reuters Institute for the Study of Journalism where 79% of publishers expect subscriptions to be an important source of digital revenue.

Whilst ad growth is slowing IPA Bellwether predicts ad spend rebound with media advertising’s net rise of 3.1% with video leading marketing investments.  With TheDrum canvassing expert opinion, there’s a number of concerns around possible lower consumer spending due to rising inflation & cost of living as well as changing habits as we come out of the pandemic.  Some other interesting points include increased sophistication of audio & TV advertising, flexibility of ad budgets, as well as big events such as the Queen’s Platinum Jubilee and the men’s football World Cup.

A BBC subscription?

Another publisher that may be looking to subscriptions is the BBC with the license fee under threat.  TheDrum discusses the various possibilities for the BBC and the impact they could have including the potential of ads – something already done for its world services.  For instance; if it did introduce ads in the UK it would own approx 30% of inventory of an enlarged TV market, which could drive ad prices down.

Media moves: Arena Group acquires Parade, and a new W3C group

In yet another big media M&A move, The Arena Group will acquire lifestyle magazin brand Parade and parent company Athlon Media Group – which owns multiple media brands – for $16million.  The move is part of Arena Group’s push into lifestyle content and will boost its sports vertical which includes Sports Illustrated.  Arena Group reportedly made $180m in revenue for 2021 – 41% up year-over-year with 60% from print & digital subscriptions and 35% from advertising but plans to diversify into areas including podcasting and commerce.

New W3C group to get practical about post-cookie tech

Part of the World Wide Web Consortium (W3C), the Private Advertising Technology Community Group (PAT-CG) has its first meeting due in February.  PAT-CG’s scope is specifically on advertising.  With a cross-section of browser makers, advertisers, ad buyers, publishers and ad networks, the aim is to have balanced discussions on privacy-preserving ad proposals to deliver practical guidance.

Expert viewpoints in media & tech

Furthermore; there’s some interesting interviews with various industry leaders including:

  • Magnite head of international, James Brown, speaks about the future of privacy, personalisation and programmatic. Specifically Brown discusses the ability for privacy and personalisation to co-exist, with transparency a critical component to achieving this
  • Leaf Group CEO, Sean Moriarty, goes into detail on Leaf’s commerce focused rebrand and acquisition by Graham Holdings.  Specifically Moriarty shares some insights into their strategy of investing in content quality that instills trust that commerce can be integrated into whilst avoiding “loads of affiliate links”.

The Regulators: Google Analytics illegal in the EU, more Google revelations, and a ban on targeting

In another hectic week for Google, Austria’s data protection authority declared that Google Analytics is illegal in the EU citing a lack of the “adequate level of protection” to user data when being transferred between EU-US.  With similar decisions likely expected in other EU countries, the use of GA in European markets could soon come under serious pressure and potentially outlawed completely.

However; President of Global Affairs & Chief Legal Officer for Alphabet, Kent Walker played down the decision whilst calling for a new EU-US data transfer framework.  There’s a comprehensive breakdown into Google’s data flows woes from Techcrunch.

More Google revelations

Meanwhile, there were further revelations in Google’s antitrust suit where they’ve been accused of manipulating ad auctions.  The latest unsealed documents detail how Google used information from publisher ad servers – to buoy its own ad buying tech – and advertisers’ historical bid data – to potentially increase prices.  The overall feeling from experts suggests that these latest revelations will change little, though the opportunity is summarised well by one in the AdExchanger piece:

Hopefully, though, this will cause a further push toward bolder media monetization strategies and tighter control by publishers of their own assets – without forgetting that, for many publishers, this process already started months if not years ago, and without the need of a lawsuit.

Alessandro De Zanche, audience and data strategy consultant

New US bill looks to ban ad targeting

A new privacy bill in the US aims to put major limits on targeted advertising, which would tilt the market towards more contextual methods.  The Banning Surveillance Advertising Act would prohibit ad networks and facilitators from targeting though sharing personal data including contact information, lists of individuals & connected devices, and unique identifiers.

The industry reaction covered in TheDrum as well as a robust response from the IAB (see below) share similar opposition to the bill.  There’s a clear lack of understanding of the damage that such a bill would cause to the economy including the loss of internet-related jobs and the ability for small businesses to reach customers with advertising becoming “less precise and more expensive”.  For instance; a comparison with Apple’s ATT is made in TheDrum piece that “while ATT hampers the ‘co-mingling of first- and third-party data’ it doesn’t put other restrictions or outright bans on ad targeting.

It’s very early days for the bill and whilst unlikely to be passed anytime soon, it does highlight the continued growing pressure on data-driven advertising as well as highlighting how reliant many companies are on such models.

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