We are back to our regularly scheduled programming, keeping you up-to-date on the nitty gritty in ad tech. As you soak up this info and the new year, don't forget to register for PubForum Fort Lauderdale on March 9-11.
Treasury Breach Highlights Digital Security Risks for Ad Tech
Just before the New Year, federal officials announced a "major" breach of the US Treasury Department's computer system had occurred. A Chinese intelligence agency managed to get access to employee workstations and unclassified documents.
According to the New York Times, China has a particular interest in the activities of the Treasury Department as it oversees sensitive data related to global financial systems, including insights into China's economic challenges. In previous incidents, Chinese hackers also targeted the email accounts of high-ranking officials, such as the Commerce Secretary, and breached nine telecommunications firms.
It's a worrying trend for US companies, especially digitally-focused businesses. This incident highlights the need for robust security measures for ad-tech companies handling sensitive consumer and client data. As geopolitical tensions rise, protecting proprietary algorithms, audience data, and campaign metrics becomes increasingly critical for maintaining client trust and regulatory compliance. – SS
Judge Strikes Down Net Neutrality
The 20-year debate over net neutrality continued last week when a federal appeals court struck down the FCC's net neutrality protections, ruling that the agency exceeded its regulatory authority.
Columbia law professor Tim Wu coined the term "network neutrality" in a paper discussing online discrimination back in 2003. The FTC listened and, in 2005, issued a policy statement prohibiting ISPs from blocking legal content or devices. In 2010, the FTC passed its first formal net neutrality rules, but Verizon challenged them. The court ruled that ISPs are classified as "information services" under Title I of the Communications Act, which means the FCC lacks authority to regulate them with net neutrality rules.
In 2015, President Obama enshrined net neutrality, arguing that "an entrepreneur's fledgling company should have the same chance to succeed as established corporations, and that they shouldn't unfairly slow down access to a high school student's blog shouldn't to make way for advertisers with more money."
But in 2017, the FTC voted to repeal equal access, Mozilla and others sued the FTC, and some states, such as California, enacted their versions (the new ruling won't affect those state laws). In 2021, President Biden issued an Executive Order to protect net neutrality and promote competition, which the FTC followed up with its rules in 2024. These are the rules the court struck down.
For smaller and emerging digital content providers, repealing net neutrality may be an existential threat, especially if they can't afford the potentially high costs of fast-lane delivery. Consumers have shown impatience with slow page loads (which led to innovations such as header bidding and the end of daisy chains). Slower content delivery may result in the same frustrations for users, prompting them to click away rather than wait for content. Publishers are already facing economic headwinds from signal loss and loss of referral traffic due to generative AI searches. This may be the final blow to many smaller content providers. – SS
Google CEO Warns Employees That “Stakes Are High” for the Company
After decades of leading pretty much all things digital, Google faces unprecedented competition, especially on the AI front. Could the mighty powerhouse go the way of AT&T or Blockbuster? While such comparisons may be premature, Google's leadership is clearly concerned.
According to CNBC, CEO Sudar Pichai told employees, "I think 2025 will be critical. I think it's really important that we internalize the urgency of this moment, and need to move faster as a company. The stakes are high. These are disruptive moments. In 2025, we need to be relentlessly focused on unlocking this technology's benefits and solving real user problems."
Pichai went on to say that some of he expects the pressure the company faces. Since we've entrenched digital services into the American economy and daily life, increased scrutiny from regulators is inevitable.
After years of dominating the search business and raking in huge profits, Google is facing serious competition from OpenAI, Perplexity, and others and is keen to develop the next big business. According to DeepMind co-founder Demis Hassabi, who attended the meeting, that may come from turbocharging the Gemini app. One area for such turbocharging is a universal assistant that "can seamlessly operate over any domain, any modality or any device" -- potentially differentiating Google from single-purpose AI tools.
While Google has significant challenges ahead, it maintains considerable advantages in data, infrastructure, and market presence. As Pichai noted, they don't need to be first; they need to be the best. – SS
Apple Agrees To Pay $95 Million in Suit Over Siri Privacy Violations
Fed up that advertisers served them ads based on conversations with friends, Apple users accused Siri of eavesdropping and won. Apple agreed to pay a hefty settlement to a class-action suit that accused Siri of listening to and recording user conversations without their consent. Anyone who has owned an Apple device between September 17, 2024, and December 31, 2024, is eligible for a payout (expected to be around $20 per device). For its part, Apple says it did nothing wrong and opted to settle to avoid costly litigation.
Apple isn't the only company that has faced blowback from its voice-activated assistant. Amazon's Alexa faced allegations of retaining children's voice data and violating COPPA, resulting in a $25 million settlement. Google Assistant had issues with data breaches (including home addresses of kids) as well as human review of voice recordings.
What all of these cases have in common is the challenge of balancing functionality with user privacy and compliance with COPPA, GDPR, and CCPA, among others. Users need to realize that their voice assistants collect sensitive data and wade into the privacy policies of their device manufacturers to protect themselves. Per Pew Research, just 56% of Americans say they always, almost always, or often click "agree" on privacy policies without reading them. Until we reach 100%, we can expect to see more settlements like Apple's. – SS
Privacy Falls Out Ad Tech News Cycle
Privacy debate seems to be dead in #adtech. It lived as long as google’s privacy sandbox was in the news. And now the Adtech news cycle has changed.
What’s the latest buzzword these days in Adtech ?
Breaking Away From Low-Quality Data
Scott McKinley’s journey from professional cyclist and captain of the 1988 US Olympic Road Cycling Team in Seoul, Korea, to CEO and founder of data validation provider Truthset was more linear than one might think.
He also discusses what happens when marketers use inaccurate data, McKinley’s unvarnished view on ID bridging (he’s, uh, not a fan), and why cycling wasn’t the best way to get girls in high school.
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