The Next Thing - Issue #160

Hi <<First Name>>,

I had a cracking chat with celebrity-tech podcaster/TV host Tommy McCubbin a few weeks back about a great range of topics. He’s slicing and dicing that into a few short videos, the first of which you can have a look at here. (trigger warning: Metaverse)

Tommy also gave the newsletter a shoutout, so welcome to the new subscribers. And for everyone who has been asking me for a signup form, you can now point your friends (or enemies, I’m not fussy) to blonde3.com and they can jump on board.

Nic.

Google isn't surprising anyone

An antitrust lawsuit has been brought against Google by 24 US states, focusing on its outsized influence on digital advertising. While it was initially lodged in August, an updated filing removed redaction of all the good bits.

The TLDR; is that Google has been doing some evil by manipulating programmatic advertising for its own benefit. When you consider that Google is involved in the vast majority of programmatic advertising, that's a lot of benefit.

The non TLDR; is a bit nerdier and is a shopping list of "finger on the scale" moments that have accumulated over the past decade: slowing down ads that didn't use AMP, killing header bidding, colluding with Facebook in said attempt to kill header bidding, manipulating advertiser bids to ensure competitive DSPs didn't win auctions, fun stuff! Not evil! Promise!

An interesting tidbit from the filing was also analysis claiming that Google takes 42% of every dollar flowing through the digital ecosystem. Unsurprisingly, quite a few publishers, advertisers and agencies weren't chuffed about this.

Of course none of this is surprising. Digiday followed up with a nice hot-take - Ad execs dismayed, but not surprised, by tactics Google allegedly used to control digital ad dollars. Anyone who's had any exposure to digital media and advertising quickly works out that most of the plumbers are at least a little bit shady. And that makes Google and Facebook the shadiest. But don't expect anything to change until someone builds a better mousetrap.

Meta-meta

Well it happened. As per last issue:

If the new name really is Meta, I think it proves that nobody in the company has the ability to tell the Zuck that he's wrong.

There were obviously no end of hot takes on this, so I won’t recap them. The only interesting thing to add to the point above is one reason to say yes to a new name: The Facebook brand was hurting Instagram and WhatsApp, with employees referring to the Facebook "brand tax". I figured the brand didn’t help talent acquisition, but interesting to know that inside the building there may have been evidence that the brand as hurting products.

I've spoken with a bunch of agency and marketing folk since the new name, and it seems to have triggered new questions about the metaverse. My answer? Don't get sucked into the nonsense.

So much trade press and think piece posts and conference minutes will be spent talking about "your brand metaverse strategy" over the next few months or (god help us) years. But it's still early days. It's most likely all going nowhere, and if it does goes somewhere it won't look a think like anybody expects right now.

(If you're still keen I'll charge you good money to write up your brand Metaverse strategy, and then you can file it between your Second Life and Wearable strategies)

Apple ate $10B of cookies*

Facebook's Q3 results were pretty good (all things considered!) - up in terms of users, but slightly under estimates in terms of revenue ($29B vs. $29.5 estimates). But Q4 revenue forecasts are already back on what analysts were expecting, and Facebook is attributing most of the slowdown to Apple's iOS changes that severely limit user tracking.

Since Apple's update, Facebook, YouTube, Twitter and Snap have all reported earnings, allowing analysis of the impact to ad revenue. Most of the platforms expected users to happily hit the "please track me" buttons when the iOS update arrived, but it appears that instead, around 12 percent of ad revenue has disappeared. Across two quarters, that's US$9.6B. I don’t think many people hit that button.

What's a marketer to do? It was interesting to see a couple Australian CMOs talking to Mi3 about the challenge. Their solution seems to be attribution and econometric modelling. A nice reminder that everything old is new again - it's time for the media agencies to dust off those fancy spreadsheets from a decade ago.

* yes I realise ATT has nothing to do with cookies, but spending time on headlines isn’t my thing

Twitter keeps on shipping

Life continues in this strange alternate reality where Twitter actually ships new products. (And I'm all for it)

Twitter Blue has been in beta in a few small markets (including Australia) but has now rolled out to the US. Quick refresher: Blue is a user-subscription offering that provides ad-free reading of some publisher websites along with some other OK features (undo tweet, folders, themes, blah blah).

Note that Twitter isn't keen to remove its own ads here - it's all about the publisher side of things. Twitter's claim is that publishers will make 50% more from the Blue revshare deal than they would from the ads that get removed.

It will be interesting to see if Blue gets traction with users (doubtful) and a lot of publishers (more likely). But one outcome for advertisers may be that a small number of impressions to (probably high-value) eyeballs will disappear. Another small slide in a death by a thousand cuts.

In creator revenue news, Twitter is also rolling out the Super Follow feature globally.

Quick refresher: Super Follow allows big-name tweeters to charge fans a small monthly fee to be Super Followers. In return, these fans get exclusive tweets. Some analysis suggests the feature generated $6,000 in its first two weeks, so it's not minting any millionaires yet. Still, it's another interesting brick in the creator revenue wall, and an interesting angle for brands working with creators on Twitter.

Meanwhile, over at Patreon (which generates a slightly more impressive $3.8M for creators every 2 weeks), a new video player is in the works. It's fair to say most creators don't love YouTube, so this could be an interesting move. Whether or not PatreonTube also builds an ad model will be interesting to watch - there's no doubt there's some brilliant and engaged audiences subscribed to the platform's creators.

Happenings…

Move over Facebook, Iceland has nailed the metaverse (the casting on this is just spot on 👌🏻)

Netflix Games have launched. Android only for now, and with five titles (two based on Stranger Things). The hot-take narrative here is "Netflix takes more attention away from ad-supported media", but my bet is that this idea will quietly be shuttered within a year.

In a roundabout admission that Instagram is about as good for the world as pokie machines, a test has launched which allows users to "remind themselves to take a break from using the app after either 10, 20 or 30 minutes".

The Australian Government news media bargaining code is going about as well as expected. Including Facebook reaching an agreement with the ABC but not cutting a deal with Australia's other public broadcaster, SBS. 🤷🏻‍♂️

A (rare) good piece of analysis on the potential and risk of the crypto market. Also of note: 10,000 people hold over one-third of the Bitcoins 🤔