Cambridge Analytica Hauled Onto the Rug
For starters, an item you’ve already heard about: Remember the user data Cambridge Analytica eventually used to build models that were in turn used to target ads on behalf of the Trump campaign? It was collected without user consent, according to a whistleblower from inside the company. Cambridge Analytica’s use of “psychographic data” has always been controversial—for complicated reasons, but in short, this data goes beyond standard demo/geo/behavior-type data points, and tries to create models around psychological traits, through game-like personality tests spread by advertising on Facebook. But new revelations of its data harvesting methods go beyond all that. Reports say Cambridge Analytica pulled in data points from not only users who took the tests, but from their Facebook friends—allegedly up to 50 million Facebook users in total. Cambridge Analytica has since been suspended from Facebook. But according to reports in various outlets, as far back as 2015, Facebook was aware Cambridge Analytica was harvesting data it shouldn’t, and the platform simply told CA to knock it off.
Here’s Team AdMonsters’ take: Mark Zuckerberg’s newfound discovery of Facebook’s conscience, and his commitment to the platform being a force for good, is a little disingenuous, and it’s contradicted by basically Facebook’s entire history of raking in dollars first and atoning for its sins of omission (like bad partner-vetting) later. I’ve always thought Zuck speaking about social accountability sounded like a man out of his league, and that’s probably because he is one in this case.
Facebook/Google Set to Lose (A Little) Market Share?
So with Facebook getting beaten up in the public square first for allowing fake news outlets to run wild on its platform, then for keeping the door open to the likes of Cambridge Analytica—will its revenue take a hit as well? Seems unlikely, as the sheer numbers of Facebook’s audience are undeniable. But a new eMarketer report suggests Facebook’s ad business might have already peaked, regardless. According to eMarketer analysis, the price of News Feeds ads seems to have maxed out, and the bulk of the company’s revenue growth is coming from Instagram. Overall, Facebook and Google’s combined digital ad market share is projected to drop by 1.7% from last year. Snapchat’s revenue is growing rapidly, but you have to wonder how sustainable that growth is—at the PubForum two weeks ago, we just heard Frank Simonetti, CEO of the Gen Z-focused media outlet Sweety High, tell us Snapchat ad performance is hard to quantify. Amazon is also on the rise, and it to be in a great position to take the number three spot in ad market share: eMarketer suggests it’ll be in that position by 2020. That seems like a safe prediction.
Inside One of Newsweek’s Questionable Ad Partners
As you’ve also heard, Newsweek is in hot water for buying bot traffic. Now AdExchanger gives us the skinny on one dodgy company that gave Newsweek an assist in that effort: PopAds, which specializes in pop-unders, pushes bots from sites with nonsense URLs to legit sites in need of traffic, and has a founder who had previously overseen an ad network that was called out for spreading malware. The AdExchanger story is a fun, if harrowing, read—Allison Schiff summarizes a whole buffet of bad behavior on PopAds’ part. In addition to serving pop-unders, which obviously serve no good purpose to either advertisers nor users and have been banned by AdSense, PopAds is accused of reselling traffic and cryptomining. The crypromining bit is interesting: When bots are identified as bots, their computer processing power is drained and used to generate cryptocurrency. But PopAds has been accused of doing the same with legit human users, too, and not just bots. The AdExchanger article ends with a quote that sounds kind of defeatist—stuff like this happens because there’s no clear way to prosecute ad fraud—but you have to wonder: It’s 2018, so why the heck isn’t there a way? (Oh, that’s not a rhetorical question: We totally know why there isn’t.)
iHeartMedia Filing for Bankruptcy
The company behind the biggest radio broadcaster in the U.S., iHeartMedia, announced it was filing for bankruptcy. The company is about $20 billion in debt. Some of us in media have mixed feelings about this. On the one hand, there’s something tragic about seeing a legacy media company fall from grace like this—especially when part of its woes come from circumstances seemingly out of control, like being bought out by a private equity firm funded by banks on the eve of the Great Recession a decade ago (which is exactly what happened to iHeartMedia). It’s also sad to consider the number two radio broadcast company in the country, Cumulus, just went bankrupt itself. On the other hand, iHeartMedia is the company once known as Clear Channel, which for years had bought up local radio stations, imposed restrictions on programming, replaced local hosts with syndicated shows, and generally contributed to the homogenization of broadcast radio. Maybe banking on a captive audience was a good strategy in the ’90s, but not for the broadband era.
Google: No Crypto-Soliciting Allowed
One more parting shot: Everyone in digital advertising has thoughts about blockchain right now, many of them positive. But we keep shouting that blockchain is not bitcoin, and it’s an important distinction: Not quite so many folks are gung ho about cryptocurrency right now. Google is making moves to ban ads related to cryptocurrency, an effort to curb “unregulated or speculative financial products.”