Federal Privacy Bureau in the Making; Disney Wants all the Hulu; Roku Throws SMBs a First-party Lifeline

AdMonsters Wrapper: The weekly ad tech news wrap up
This Week
September 12, 2022
Federal Privacy Bureau on the Way?
Disney Prepares to Aquire Hulu From Comcast
Roku Links First-party Data to SMBs
Around the Water Cooler
Bureau of Privacy Could Set New Precedent for Privacy Regulations
Privacy regulations have been setting the law of the land in the ad tech industry for a while now. Thanks to a potential bill being proposed by the U.S. government that could establish a Bureau of Privacy, it might have just found its delegates.

The American Data Privacy Protection Act (ADPPA) was introduced in June with significant bipartisan support, but some agreed that there were some complications to work out.

There is one part of the bill that is now eligible for a vote in the House that could systematically change how privacy regulations are protected and enforced. The Bureau of Privacy would be established as a part of the Federal Trade Commission and would set a new federal standard on privacy.

The Bureau will be tasked with enforcing regulations already outlined in the bill and creating new ones. For now, their responsibilities are:
  • Ensuring that targeted advertising doesn’t discriminate against individuals, citing civil rights.
  • Establishing rules for and reviewing algorithmic impact assessments that “large data holders” would be required to file.
  • Keeping an eye on data minimization, or making sure companies are only collecting the data that is “reasonably necessary and proportionate” for a business to operate, and nothing more.
Why This Matters
The ad tech industry has been working to improve its data ethic standards and the Bureau of Privacy just might be the checks and balances they need to settle on new ground.

The industry's former lack of regard for protecting consumer data for increased revenue has been a bit of a stain on past industry standards. Although, protecting consumer data has become a priority in recent years.

According to Daniel Kaufman, who previously worked at the FTC’s Bureau of Consumer Protection, the Bureau of Privacy would “dramatically elevate the profile of privacy in this country and the agency internationally.”

Yet, there is still some pushback on the bill that could stop the bureau from being formed. House Speaker Nancy Pelosi asserted that she will not support the ADPPA. Her reasoning is that the bill might override California’s existing privacy laws.

“With so much innovation happening in our state, it is imperative that California continues offering and enforcing the nation’s strongest privacy rights,” said Pelosi. “California’s landmark privacy laws ... must continue to protect Californians — and states must be allowed to address rapid changes in technology.”

Despite this, there is still a high possibility that the Bureau will make it past the vote. If so, there will be federal regulation of privacy in the U.S. We may be closer to a federal privacy bill than ever, but that it will happen this year is highly unlikely.

It will take some time for the ad tech industry to maneuver the new regulations, but protecting consumer data should be held at the utmost importance.
Will Disney Move Forward With Acquiring All of Hulu?
The clock is ticking, and we're wondering, what Hulu's fate will be.

Disney and Comcast have an agreement in which Disney is set to acquire Comcast's 33% stake in Hulu by 2024, and with Disney already owning two-thirds of Hulu, it looks like this is bound to happen whether Comcast likes it or not. While Comcast sees value in Hulu and believes it is a better fit for NBCUniversal than Disney, they are preparing for Disney to buy them out.

According to industry insiders, there was a time when Comcast entertained the idea of buying all of Hulu from Disney after Disney agreed to acquire majority of Fox's assets in a $71 billion deal that closed in early 2019. Disney gained 66% ownership after acquiring Fox's minority stake in Hulu and ended up dismissing the idea.

Disney guaranteed a sale price that values Hulu at least $27.5 billion.
Why This Matters
After Disney lowered Disney+'s 2024 guidance and raised its prices, it signaled to Comcast that Disney's bid for acquiring all of Hulu was back on the table. Hulu's average revenue per user is $12.92 per month, triple Disney+'s global ARPU of $4.35 and more than double Disney+'s ARPU in the U.S. and Canada ($6.27).

Let's not forget Disney's streaming strategy includes bundling Disney+, Hulu, and ESPN+. Disney raised Disney+ prices by 38% and ESPN+ by 43%, but the bundle trio only increased by one dollar. So it's clear that Disney is trying to encourage consumers to lean in on that bundle.

Lately, we have watched industrywide streaming subscriber growth stagnate, forcing ad-free platforms like Netflix to bolt on an ad-supported tier. In the race to meet advertiser KPIs and solve for measurement, media and entertainment companies have their minds set on building a good subscriber base instead of just getting subscribers. So if Disney isn't seeing results from its Disney+ growth, then scooping up all of Hulu becomes the next best thing in terms of its long-term strategy.
Roku’s New Program Leverages First-party Data to Small and Medium-sized Businesses
As we all know, privacy regulations and big tech privacy changes have upended the advertising ecosystem's consumer data collection strategies. While everyone is learning as they go, larger companies have had an easier time leveraging first-party data and diversifying ad spend. On the other hand, small to medium-sized businesses have struggled to do the same. Roku seeks to change that with its new program.

Roku recently announced a new program to assist small businesses struggling with targeted advertising. It will offer streaming audience data and ad buying tools directly to small to medium-sized business clients. The CTV company announced Camelot Strategic Marketing & Media as their first partner in the new program. It asserted that the platform would run through their ad buying platform, OneView, which Roku launched in 2020.

Tommy Burk, senior director of Roku’s OneView platform, maintains that small and medium-sized businesses want to diversify ad spend away from search and social. The company hopes this program will be the way to do it. Through OneView’s channels, these businesses will access 63 million active global accounts.
Why This Matters
Many industry experts believe that leveraging first-party data will be essential to thrive in a cookieless world filled with consumer privacy regulations. Many SMBs do not have access to this data like some larger companies. Roku’s new program could be a game changer for them.

Roku’s research showed that “consumers have become more aware of how advertisers use data, and 86% of U.S. adults indicate that data privacy is a growing concern for them.” They began understanding how the privacy-centric world affected small businesses, specifically in CTV and streaming.

Roku’s ad buying platform enables first-party data to build effective ad campaigns on streaming platforms, mobile devices, and desktop. Smaller businesses will now have the ability to:
  • Leverage their first-party data to broaden their audience scope.
  • Strategically segment audiences to stimulate engagement among lapsed or current customers.
  • Use first-party data to reach website visitors with TV streaming ads and acquire more first-party data based on who sees the ads.

Roku’s OneView platform will open up a new list of opportunities for SMBs that might help them survive and thrive under the new world order in ad tech.
But Wait, There's More...
Instagram Fined Over $400m for Violations Involving Children's Data Meta was fined $402 million by the Irish Data Protection Commission for its handling of children’s privacy settings on IG, violating GDPR. It’s the second-largest fine under GDPR, and the third (and largest) fine levied against Meta by the regulator. Could this be the sign of more crackdowns to come concerning privacy data issues? (Engadget)

IAB Europe's Appeal Against TCF GDPR Violations Shut Down Multiple grounds for appeal lodged by the IAB Europe, against a breach finding earlier this year against its Transparency and Consent Framework have been dismissed by the Brussels Market Court of Appeal. It's been slow going, but enforcement could be next if IAB Europe doesn't make significant changes. (TechCrunch)
 
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A Solution for Bad Ad Placements?
wouldn't it be a lot easier for ad agencies to (1) maintain a list of legit sites and which clients they're good for and (2) validate SupplyChains than to keep dealing with Terrible Ad Placement Friday?

It's an interesting thread, started by Don Marti, VP of Ecosystem Innovation at CafeMedia, that gets at the heart of unfunding crappy sites so that legit pubs can get the ad spend they deserve.
Worth a Listen
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The Future Playbook for Sustainable Publishing
Future is a collection of over 200 specialist titles that range from gaming and tech (Tech Radar) to homes (Homes & Garden) to beauty and fashion (Who What Wear) to B2B (SmartBrief). Future has established itself as one of the UK’s most successful publishers. (Its current market capitalization puts it at 8x the value of BuzzFeed.)

But for its future growth, Future is betting heavily on the U.S. market, which CEO Zillah Byng-Thorne noted is five times the size of the UK. The U.S. already represents 35% of Future’s audience as well as 38% of its revenue.
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