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The WIR: Vast Majority of US Publishers See Campaigns Paused and Cancelled, France Orders Google to Pay Publishers for News, and Publicis’ CEO Predicts Coronavirus Fallout will be Worse Than 2008 Recession

  17 April, 2020

In this week’s Week in Review: The IAB finds publishers are seeing widespread pausing and cancellation of ad campaigns, France’s competition authority calls on Google to negotiate with publishers over payments, and Publicis’ Arthur Sadoun expects coronavirus’ impact on ad land to be worse than the 2008 recession. To receive an update on the industry’s top stories every Friday, sign up to the weekly Video Round-Up.

Top Stories

Eighty Eight Percent of US News Publishers Have Been Asked to Cancel Campaigns
Eighty-eight percent on news publishers in the US, and 70 percent of non-news publishers, have been asked by buyers to cancel ad campaigns, according to research released by the IAB’s US branch this week. Meanwhile 86 percent of news publishers and 79 percent of non-news publishers say they’ve been asked to pause ad campaigns, as advertisers tighten their belts due to the pandemic.

IAB SellSide

The IAB’s research into COVID-19’s impact on the sell-side found that 98 percent of US sell-side companies expect 2020 ad revenues to fall short of original forecasts. And legacy media channels are expected to be worst hit. On average, legacy media companies which are reforecasting their 2020 revenues have adjusted downwards by 30 percent, while digital media companies on average have adjusted down by 21 percent.

French Regulator Orders Google to Pay Publishers for Google News
France’s competition authority has ruled that Google must negotiate with publishers around payment for publishing snippets of their work via its Google News service. Google had previously reworked Google News in France, only displaying headlines rather than text snippets, in response to demands to pay publishers for their work. But now France’s ‘Autorite de la Concurrence’ says Google must discuss payments with publishers, both for its previous publishing of their work, and for future publishing of their work.

“Google’s practices caused a serious and immediate harm to the press sector, while the economic situation of publishers and news agencies is otherwise fragile, and while the law aimed on the contrary at improving the conditions of remuneration they derive from content produced by journalists,” the competition authority said in a statement.

Google however has precedent of playing hardball with publishers over payments – in Spain, it has scrapped its Google News in response to laws which would have required it to pay for news content.

Publicis CEO Sadoun Expects COVID-19 Recession to be Far Worse Than 2008
Publicis Groupe CEO Arthur Sadoun said he expects the economic fallout from the coronavirus pandemic to hit adland far harder than the Great Recession of the late 2000s. “This crisis is going to be unprecedented by its magnitude, complexity and length,” he told the Wall Street Journal, saying that he expects the pullback in ad spend to be far steeper than the ten percent drop seen in 2009.

Sadoun said that the drop in spend his own company saw in March was “more dramatic than anything we have seen in the past”. While Publicis’ revenues for Q1 were actually up year-on-year thanks to its purchase of data company Epsilon, total sales were down by 2.9 percent on an organic basis. And in many important markets, including the US, Sadoun said the effects of the pandemic had only just started filtering through by the end of Q1 – the total impact will be much more pronounced by the end of Q2.

Coronavirus Updates

Coronavirus continues to dominate the news cycle, and most stories and events have been impacted by the pandemic in one way or another, but here are some of the biggest stories of the week directly related to COVID-19:

US Retail Sales Fall 8.7 Percent in March
Total retail sales in the US fell by 8.7 percent in March compared to February as consumers tightened their belts in response to the pandemic and certain sectors were forced to stop running the majority of their businesses due to social distancing measures. This marks the biggest month-on-month drop since 1992 according to the US Commerce Department.

Omnicom CEO Wren Says Layoffs and Furloughs Will be Necessary
Omnicom Group chairman and CEO John Wren said in an internal memo this week that furloughs and staff layoffs will be necessary across many of its agencies in response to the pandemic. Wren noted that the holding group will aim for furloughs where possible, so that staff can be brought back in when client demand recovers, according to AdAge.

Verizon Media Donates $10 Million in Ad Space for COVID-19 Relief
Verizon Media is donating $10 million worth of ad inventory to support mental health and public health campaigns designed to support those hurt by the pandemic. Verizon will also provide campaign support including creative services and management.

Condé Nast Announces Pay Cuts, Furloughs and Possible Layoffs
Magazine publisher Condé Nast sent a memo to 6,000 employees this week saying it is instituting an austerity plan which will involve pay cuts, furloughs, and possible layoffs. Those earning $100,000 will see their salaries cut by between ten and twenty percent for five months, according to the New York Times.

OpenX Insures Against DSP Defaults
Sell-side ad tech company OpenX has added an insurance line against demand-side platforms defaulting on payments, according to AdExchanger. OpenX is also advising clients to avoid working with intermediaries which won’t insure campaign spend.

Facebook’s Ad Rates Fall
Facebook’s ad rates fell by between 15-25 percent in March compared to February, according to the Wall Street Journal. Instagram and YouTube have also seen similar drops, according to the report.

The Guardian Furloughs 100 Staff
The Guardian said this week it is furloughing roughly 100 non-editorial staff in an effort to reduce costs amid industry-wide revenue falls. The publisher said the number of unique browsers on its site doubled to reach a record 366 million in March, but it nonetheless expects revenues for the first half of the year to be down by at least £20 million.

IPG’s Roth Warns Layoffs and Furloughs May be Necessary
Interpublic Group’s CEO Michael Roth sent a memo to all IPG agencies last week saying that while efforts to cut costs have so far been effective, some agencies will need to cut staff. IPG agency MullenLowe has already announced a round of layoffs, according to AdWeek.

WWE Returns to Live Broadcasts After Being Deemed ‘Essential’
Professional wresting brand WWE has resumed live broadcasts after the Florida Governor’s Office deemed live sports “essential services”. “We are producing content on a closed set with only essential personnel in attendance following appropriate guidelines while taking additional precautions to ensure the health and wellness of our performers and staff,” the company told CNN.

Consumers Don’t Think Brands Should Stop Advertising During Pandemic finds GlobalWebIndex
Consumers don’t think brands should stop advertising during the pandemic, according to research from GlobalWebIndex. Overall 73 percent of respondents either strongly agreed, somewhat agreed, or neither agreed nor disagreed that brands should advertise as normal during the coronavirus outbreak.

The Week in Tech

White Ops Uncovers Massive CTV Fraud Operation which Created 1.9 Billion Ad Requests Per Day
Fraud detection and prevention company White Ops says it has uncovered a massive connected-TV ad fraud operation which during January this year sent 1.9 billion ad requests per day, spoofing two million consumers in 30 different countries. White Ops says the operation, dubbed ‘ICEBUCKET’, is the largest server-side ad insertion (SSAI) spoofing scheme ever to be uncovered. Read the full story on VAN.

Amobee and Beachfront Collaborate on Set-Top Box VOD
Amobee this week announced a partnership with Beachfront which will see multichannel video programming distributor (MVPD) and broadcast network’s set-top box video on demand inventory made available programmatically through Amobee’s platform. “Our collaboration enables a new revenue stream for both publishers and MVPDs, allowing them to unlock and execute dynamic ad insertion for video on demand,” said Bryan Everett, SVP of business development at Amobee.

FreeWheel Launches “Unified Decisioning” Capability
FreeWheel on Monday brought its “unified decisioning” platform, which considers both programmatic demand and direct sales deals when auctioning inventory, out of beta. The product is being used by both FreeWheel sister company NBCUniversal and The Trade Desk, as well as a number of other non-public DSP partners according to AdExchanger.

Beeswax Acquires MediaGamma
Beeswax announced this week it has acquired London-based tech company MediaGamma, while, a machine learning platform incubated by MediaGamma, will remain an independent company. The acquisition closed last week and resulted in three of MediaGamma’s data science team members joining Beeswax’s London office.

IAB Europe Launches Digital Advertising Effectiveness Measurement Framework
IAB Europe this week announced the launch of its new Digital Advertising Effectiveness Measurement Framework – a set of harmonised definitions, measures and metrics which aim to resolve the on-going confusion for investors when buying digital media research. “We believe a common ‘lingua franca’ and set of standards, as proposed within our Digital Advertising Effectiveness Measurement Framework, will remove this fragmentation and help accelerate more investment and understanding of digital advertising research,” said IAB Europe CEO Townsend Feehan.

Roku Claims 39.8 Million Active Accounts by End of Q1
Roku published estimates of its Q1 financial results earlier than planned this week in light of the COVID-19 pandemic, in which it says it estimates it had reached 39.8 million active accounts by the end of Q1, up three million from the previous quarter. Roku expects total revenue for the quarter to be between $307 million – $317 million.

PubNative Launches Programmatic VR Offering
Mobile publisher platform and programmatic ad exchange PubNative announced this week it is expanding its offering with ads in gaming and VR environments, partnering with in-game monetisation platform Admix. “We’re excited to partner with PubNative, to tap into premium programmatic demand and deliver more revenue for our publishers across the world, specifically in geos that are traditionally harder to serve,” said Samuel Huber, CEO at Admix.

Consumers Are Seeking Out Uplifting Content on YouTube says Channel Factory
During the coronavirus pandemic, consumers are heading to YouTube to seek out uplifting content, according to research released by Channel Factory. Eighty percent of respondents to Channel Factory’s survey said they go to YouTube to lift their mood, while 69 percent said they find YouTube’s content more uplifting than other channels’.

The Week in TV

‘Peacock’, Comcast’s AVOD App, Goes Live
‘Peacock’, a new streaming service from Comcast’s NBCUniversal, went live on Wednesday in the USA for subscribers to Comcast’s Xfinity TV and internet bundles. Peacock is completely free for Xfinity customers, relying entirely on ad revenues for monetisation – though the service will release a paid subscription tier for people not subscribed to Comcast later in the year. Read the full story on VAN.

ITV Hub Sees Massive Spike in Viewing
ITV’s streaming platform ITV Hub has seen a huge spike in viewing across the first three months of 2020, with total hours of consumption up 82 percent year-on-year. “The recent uplift in the first quarter for the ITV Hub and Hub plus in both reach and consumption is hugely encouraging, as we continue to evolve the platforms and look at new ways to enhance our content,” said Steve Forde, ITV’s director of digital products.

Quibi Accelerates TV Plans After Picking Up 1.7 Million Downloads in Launch Week
Quibi, the new short-form mobile-first streaming service launched last week, has attracted 1.7 million users within its first week according to CEO Meg Whitman. Whitman also revealed the company is accelerating plans to let users watch Quibi shows via their TV sets to drive further adoption during the coronavirus lockdown. Read the full story on VAN.

The Week in Publishing

YouTube Releases New Video Ad Creation Tools
YouTube this week said it is accelerating the rollout of a new set of tools designed to help small businesses create simple video ads to run on its platform. The free beta tool animates static assets – images, text and logos – and adds music from its library. Advertisers can choose from a variety of layouts based and customise colours and fonts to generate either six or fifteen second ads.

YouTube video builderInstagram Updates IGTV to Focus on Creators
Instagram this week released an update for its IGTV app, its standalone hub for mid-to-long form video content, now featuring a creator at the top of its home page, specifically chosen to appeal to the user according to The Verge. The update also introduces a new ‘Discover’ tab to the app, to help users find new content creators.

Reddit Tracks Political Ad Spending on its Properties
Reddit this week announced updates to its political advertising policies, announcing that it will track all political campaigns run on its properties. Users will be able to see which campaigns were run, who bought them, how much was spent and who was targeted via a specific subreddit. Reddit also announced that political ads, which appear as posts on the site, must have public comments enabled for at least their first 24 hours.

Amazon Cuts Affiliate Rates for Publishers
Amazon is cutting the rates it awards to publishers signed up to its affiliates programme, with the cuts coming into effect from April 21st, CNBC reported this week. The cuts vary depending on category, with rates for furniture and home improvement products having fallen from eight percent to three percent according to the report, and rates for grocery products having fallen from five percent to one percent.

ByteDance to Hire 10,000 New Employees After TikTok Success
Chinese tech giant ByteDance is looking to make 10,000 new hires, driven in part by the success of its video sharing platform TikTok, the FT reported this week.

BuzzFeed Puts German Business Up for Sale
BuzzFeed is looking to sell its German business after six years, Digiday reported this week. The exit follows BuzzFeed pulling out of Spain and France over the past two years, signalling something of a scaling back of its international ambitions according to Digiday.

The Week for Agencies

Dentsu Takes 100 Percent Ownership of Merkle
Dentsu Aegis Network has taken 100 percent ownership of data and analytics business Merkle ahead of its previously planned date, though payments for the unit will still continue into next year. Dentsu says Merkle significantly strengthens its CRM business, which it says is its area of highest growth.

Adam&eveDDB Beats Out AMV BBDO as UK’s Largest Creative Agency
Adam&eveDDB has beaten out AMV BBDO to become the UK’s largest creative agency as measured by total billings, according to Campaign’s ‘School Reports 2020‘. Adam&eveDDB’s total billings for 2019 reached £488 million according to the report, while AMV BBDO’s billings reached £453 million.

Sorrell Calls for Radical Rethink of Cannes
Sir Martin Sorrell, executive chairman of S4 Capital, this week called on the Cannes Lions Festival of Creativity to rethink how the event is run, following the cancellation of its 2020 event. “Is it necessary to bring together so many people at vast expense in the south of France at that time of year or are there better times to do it?” he said at The Drum’s Digital Transformation Festival. “It might well be, given examination, that they decide to carry on doing it, which would be a mistake.”

Hires of the Week

Peter Naylor Joins Snap from Hulu
Peter Naylor, ad sales chief at Hulu, is joining Snapchat parent company Snap as VP of Americas. The role will see Naylor handle Snap’s advertising business in the US, Canada and Mexico according to AdWeek.

Jason White Joins LiveRamp as SVP and Head of Publishers
LiveRamp has hire Jason White as SCP and head of publishers, a role which will see him tasked with driving adoption of LiveRamp Authenticated Traffic Solutions among publishers.

Reuters Appoints Eric Danetz as Head of Revenue
Reuters announced this week it has chosen Eric Danetz as its first head of revenue. Danetz will have oversight of all revenue lines across Reuters, except events, and be charged with accelerating growth in its News Agency and direct-to-consumer businesses.

This Week on VAN

Quibi Accelerates TV Plans After Picking Up 1.7 Million Downloads in Launch Week, read more on VAN

‘Peacock’, Comcast’s AVOD App, Goes Live, read more on VAN

White Ops Uncovers Massive CTV Fraud Operation which Created 1.9 Billion Ad Requests Per Day, read more on VAN

Ad of the Week

BBC, Bringing Us Closer, BBC Creative

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