Fix/Friday —February 19

News & Politics

So the Australian squabble over paying to link to news blew up this week. All the headlines went to the global deal with News Corp but all the major news organisations in Australia have struck a deal with Google. Reuters, Nine, Seven etc will join the Google News Showcase — and get paid for links. News Corp have laddered up the deal to apply globally.

Facebook decided they don’t want to play, but in taking their bat and ball home have incensed the Australian government and just about everyone else.

It’s worth reading the coverage by Benedict Evans and (if you subscribe) Stratechery. And you can read the explanatory memo from the Australian Government — but it’s a 61 page PDF.

As the FT coverage notes they (the FT) have previously reached licensing agreements for news with Google and Facebook. But the same article says;

But people involved in negotiations in Australia told the Financial Times the sums now under discussion were “multiple times” the size of agreements signed in other parts of the world.

So as well as setting a precedent (one that the EU look set to follow) Australia has also inflated the price paid. As we said in our coverage of the Maryland digital ad tax on Wednesday, GAFA is seen as the Golden Goose and everyone with a deal is now on the phone looking to renegotiate.

How this will all play out all is a bit vague. Can Facebook get away with eliminating news for Australians? Doesn’t feel like a long term strategy, so will they end up paying like Google? And what about Apple News? Not on the same scale but they have over 100m users and publishers tend to be unhappy with monetisation to date.

Clearly Google and Facebook can afford to pay for news, and they should probably pay more tax. But Government action has resulted in a good payday for the major news suppliers. It reminds me of the story i heard about the UK news business — apparently the vast majority of its revenue at the moment is Covid related ads from the Government.

It can’t be good for democracy to have the news subsidised by the Government — directly or indirectly.

Adtech

As well as upsetting the Australians, Facebook is upping the ante with Apple — with Zuck telling his team “We need to inflict pain,” Unfortunately another of their arithmetic problems has come to light, with the FT headline saying Facebook reported revenue it ‘should have never made’ The problem of potential audience being overstated became public a while back, but a new lawsuit suggests the issue was suppressed by execs.

The EU seem to be talking themselves into a ban on targeted advertising. The European Data Protection Supervisor gave an opinion that;

…..measures should include a phase-out leading to a prohibition of targeted advertising on the basis of pervasive tracking, as well as restrictions in relation to the categories of data that can be processed for targeting purposes and the categories of data that may be disclosed to advertisers or third parties to enable or facilitate targeted advertising.

In this interview, Justin Schuh of Google — heading up their Privacy Sandbox project, manages to not answer most of the good questioning.

And I had missed that one of the key Privacy people at Facebook has moved over to Google. Rob Leathern is now VP Product at Google, working on privacy.

There is so much up in the air right now but it is vital brands keep testing and learning how things might work in this new privacy first world. The data is available — and evolving and you can get great insight. Here a smart US firm looks at ROAS using the (now default) 7 day window data from Facebook. And our friends at Fospha make a great case for independent measurement of ad effectiveness.

newTV

The latest Disney results are impressive — with streaming good news making up for the poor performance in theme parks etc. Disney+ users are now just short of 95m and when you roll in Hulu and ESPN the total number of subscribers is 146m. The one weakness is that quite a lot of new customers are in India and paying very little. But its a success — at launch Disney hoped for 90m users — by year 4.

So the question on many lips is how long before Disney catch Netflix?

A good Matthew Ball thread has some good data on churn and we see that buying Disney+ often does lead to another service being dropped — but it tends not to be Netflix.

Merchant

The Deep Dive this Wednesday was on Merchant and we covered Shopify Q4 results, the brand new TikTok Seller University, Logistics, Creative & more. Catch up here.

We have covered Little Moons here and on a recent GoodTikTokCreative. Now you can read the ‘official’ TikTok case study. Great learning for any CPG brand.

Non Fungible Tokens

The hype around NFTs keeps growing. It’s partly fueled by a rise in interest in non traditional assets like Sports Cards — with ex News Corp CEO Peter Chernin investing $40m.

Creating a new digital asset class — that has rarity built in through the crypto element — makes some sense and the NBA are well positioned to drive the growth

This thread is a good explanation of NFTs and why people are so excited

Plus +

Winners and losers of WPP’s big pivot toward tech and e-commerce — is this the strategy deck they hired McKinsey to help with?

Game makers change tune about ads

Bayer claims industry first with interactive smart-speaker ads

Kinnevik to distribute entire stake in retailer Zalando to shareholders — 800% return on investment

Baidu’s Back With an $80 Billion Rally and Electric Car Ambition — a pivot away from Ads

Red Tsunami — How China’s Mobile First Society challenges marketing

Reach for the stars: what Clubhouse can learn from TikTok

The European Consumer Organisation BEUC files complaint against TikTok for multiple EU consumer law breaches

Finally… as the opening graphic shows there is a lot going on in social. It’s still essential to make the most of GAFA, but you also need to understand the new behaviours emerging from these newer platforms. We’re here to help.

Pattern Recognition / Strategy / Consulting / Creative Thinking from Simon Andrews — Sharing knowledge through our email newsletter Mobile Fix every Friday