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The WIR: Discovery Shares Drop, WPP Refuses to Pay Share Awards to Sorrell, and Google and Facebook Results

  30 April, 2021

In this week’s Week in Review: Discovery shares drop after Discovery+ disappoints with streaming numbers, WPP refuses to pay Sir Martin Sorrell share awards, and video proves key to helping Google and Facebook post another strong quarter.

Top Stories

Discovery Shares Drop After Reporting Disappointing Streaming Numbers and Ad Sales

Discovery Inc. which owns cable channels as well as newly-launched streaming service Discovery+ has seen its shares drop after it reported disappointing subscriber growth and ad sales. 

Discovery+, which was launched in January has seen growth, with subscribers across all Discovery’s streaming platforms reaching 15 million, up from 5.2 million in December prior to the launch of Discover +. While this is significant growth, rival streaming service Disney+ is seeing extremely steep rates of subscriber growth, leaving Discovery investors disappointed in comparison. On the advertising side of the business, ad sales in the US fell four percent in Q1 2021. 

Shares in Discovery fell by as much as 8.8 percent on the New York stock exchange on Wednesday. 

WPP Refuses to Pay Share Awards to Sorrell

WPP has sparked open conflict with its former CEO Sir Martin Sorrell as it refused to pay him share awards, accusing him of leaking client information to the media. Sorrell denies the claims, telling Reuters “they’ve had to go back several years to try and find an excuse to deny me what’s mine”.

Sorrell has called in the lawyers, saying that he is owed hundreds and thousands of pounds from WPP. Sorrell resigned from WPP, a company which he founded, three years ago after a fall-out following an investigation into allegations of personal misconduct, accusations he has always denied. At the time WPP said that they could withhold payment to Sorrell, and now they have acted on that threat. Confirming in its annual report on Thursday that they would not be paying their former CEO share awards.

Video Drives a Bumper Q1 for Google and Facebook

Video has helped both Facebook and Google post strong results this quarter. 

Google’s parent company, Alphabet, reported Q1 sales of $55.31 billion, an increase of 34 percent from Q1 2020. The record sales were fuelled by digital ad success. YouTube ad sales were a particular bright spot, they beat expectations of $5.7 billion, bringing in $6 billion. This figure represents a 49 percent increase from Q1 2020, when they were at just over $4 billion. 

Facebook too saw digital advertising and, indeed video advertising, as a particular strong point in good results. Facebook reported revenue of $26.17 billion for Q1 2021, a figure that represents a 48 percent increase from the previous year. In terms of ad sales, there was a 30 percent year on year increase in the average price per ad and a 12 percent increase in the number of ads delivered.

The Week in Tech

Google Tracking Claim to Be Heard in the Supreme Court

A landmark case that alleges that Google tracked millions of iPhone users without their consent is to be heard in the UK’s Supreme Court. The hearing in the Supreme Court is not about the case itself but about whether the former director of the consumer group, Which? Richard Lloyd can bring the claim on behalf of those affected. The case is the first of its kind in the UK and Google’s lawyers said on Wednesday that it could potentially “open the floodgates” to other vast claims. 

OpenAP Launches Identifier to Streamline TV Ad Measurement and Planning

TV consortium OpenAP is launching an identifier called OpenID which is aimed at making TV ad measurement and planning more efficient. OpenID will be a common identifier that can be used across TV networks for consistent audience planning and measurement. Currently, advertisers have to adapt their ad measurement and data formats not only between CTV and linear platforms, but also for different networks. OpenAP has been aiming to simplify this ad-buying and planning process. OpenAP says that all the major broadcasters have agreed to use the identifier, as well as GroupM, Dentsu, Omnicom Media Group, Haworth Marketing + Media and Horizon Media on the buy-side. 

The Guardian Says It Will Not Use FLoC

Some publishers have decided to block Google’s Federated Learning of Cohorts (FLoC), including The Guardian. The Guardian told Digiday that it would block FLoC until the “commercial and privacy implications of the technology” becomes clearer. Contributors to WordPress have also been considering disabling FLoC, potentially spelling more trouble on the horizon for Google’s post-cookie solution. 

Zeta Global Files for IPO

Zeta Global, a company that combines marketing tech, ad tech and data services, has opened its books as it filed for an IPO on Monday. Zeta, which was founded by ex-Apple CEO John Sculley, reported $368.1 million in 2020 revenue, which was a 20.3 percent increase from the year before. The company said in its filing that it deployed 6 billion emails a month, making it a top-three email service provider. Zeta also classes itself as a top ten programmatic platform because it delivers 3 billion impressions a month on CTV.

ViacomCBS Expands with Comscore Amid Nielsen Fight

ViacomCBS has signed a deal with Comscore expanding its TV measurement services on its cable and broadcast networks. The deal comes amid an ongoing row between the Video Advertising Bureau (VAB), which represents major US networks and Nielsen over allegations that the TV measurement service under-recorded viewing figures during the pandemic. 

BT and Essence Adopt PubMatic’s Buyer-Controlled Fee Structure

Telecommunications company, BT, and data and measurement-driven agency, Essence, which is part of GroupM, have employed a buyer-controlled fee structure to gain control of all programmatic inventory bought via PubMatic. This announcement follows GroupM selecting PubMatic as its preferred global SSP partner.The partnership should give BT better visibility into how much of its total media spend reaches end publishers and help them to investigate the the lost or unaccounted-for ad spend between advertisers and publishers during a programmatic auction.

Egami.TV and Speakable Partner Select IPONWEB’s Customisable DSP

Social action company Speakable and video content platform have both selected BidCore, IPONWEB’s customisable DSP, as they expand their programmatic media buying. BidCore will let each company tailor its ad bidding strategies to fit their specific business goals and measure against the metrics that are relevant for their individual operations.

SpotX Integrates TVSquared

SpotX has integrated tv ad measurement platform, TVSquared. The partnership will allow measurement and attribution of national, regional, and local CTV campaigns.TVSquared’s ADvantage platform is designed to serve up real-time proof of performance and analytics that inform programmatic TV buying, including audience planning and targeting. The partnership will benefit clients in Europe, North America and Latin America.

Peach Acquires Adtoox

Peach has acquired Adtoox, a Scandinavian ad-delivery company. Peach is expanding its footprint into new markets and will name Stockholm as its Nordics Hub with commercial and technical staff on the ground.

The Week in TV

Roku Accuses YouTube of Anti-Competitive Behaviour in Carriage Dispute

Roku has warned its users that YouTube TV may no longer be available to them, after negotiations over a carriage deal broke down due to alleged “anti-competitive” behaviour from Google.  On Monday, Roku sent an email to its users who subscribe to YouTube TV warning them that the paid American streaming service may soon no longer be available on the platform. The current carriage deal between Roku and YouTube TV expires in the next few days. 

Oscars Ratings Are the Lowest on Record

This year’s Oscars ceremony was the lowest watched on record. American network ABC’s broadcast of the Academy Awards show Sunday night drew 9.85 million viewers, a drop of 58 percent from the previous year when it drew in 23.6 million viewers. Last year’s ceremony took place just weeks before live events were halted due to coronavirus risk.

Nearly 122 Million OTT Subscribers in Western Europe

Research from Kagan, has suggested that 16 countries in Western Europe, have 121.9 million paid streaming service subscribers across them. The countries with the largest numbers of subscribers are the UK, Germany and France. At the end of 2020, Austria, Denmark, Ireland, Italy, Norway, Spain, Sweden and the UK had more OTT than pay-TV subscriptions. 

BT Considering Selling Sports Broadcasting Business

BT is in talks to sell to or partner up with another company on its sports broadcasting business as it looks to focus on its core telecommunications purpose.  BT has held initial talks with companies including Dazn, Amazon, Walt Disney and private equity firms over a potential investment in the business. Different options for the broadcast business are being considered, including partnership, turning it into a joint venture, selling a stake or complete disposal. 

Premier League Seeks Permission to Roll-Over Existing TV Deal

The Premier League is seeking permission from the British Government to roll-over its existing broadcasting deal with Sky, BT and Amazon, rather than go to auction. The current deal is worth £5 billion and is due to go to auction soon, instead the Premier League hopes to conduct private negotiations with its existing broadcasting partners. The move marks a departure from the Premier League’s past tactic of pitting broadcasters against each other in these auctions. 

Mediaset Bids for Controlling Stake in Groupe M6 Amid Aims for Consolidation

Italian broadcaster Mediaset is bidding for the controlling stake in French broadcaster Groupe M6, its CFO confirmed on Tuesday. Mediaset joins other broadcasters bidding for the controlling stake including Mediaset’s second-biggest shareholder, French media group Vivendi <VIV.PA, and Bouygues. Mediaset also reiterated its aim to consolidate across countries on Tuesday and said it would ask shareholders to approve moving its legal headquarters to the Netherlands. 

Rakuten To Expand Into Europe

Rakuten has launched AVOD channels in 42 European markets. The new offering consists of over 90 free linear channels, which will consist of a variety of content depending on which market including movies, entertainment, lifestyle, music, sports, news, TV shows and kids. Content will be available from a number of brands including Bloomberg, CNN and Conde Nast. 

Peacock Subscribers Reach 42 Million

Peacock has beat earnings estimates as its number of subscribers hit 42 million this quarter. The number of US-based subscribers of NBCUniversal’s AVOD service Peacock rose from 33 million in the fourth quarter of 2020 to 42 million in Q1 2021. The streaming service generated revenue of $91 million, which was better than predicted, Comcast reports. However, it had an adjusted EBITDA of $227 million, the company has made losses as it acquires more content sources.

The Week in Publishing

LinkedIn Ads Business Brings in More than $3 Billion in Revenue

Professional networking site, LinkedIn brought in more than $3 billion in revenue during the year ending 31 March. This figure was higher than ad competitors like Snap and Pinterest. LinkedIn’s Marketing Solutions unit’s clients include brands like American Express, Adobe and Chase. The company has tried to reposition itself as a better home for business-related ads than digital giants like Instagram and LinkedIn. 

Amazon Sellers Will Now Be Able to Contact Consumers Directly 

Amazon is testing a new feature that will allow sellers to directly contact customers via email to inform them of deals and sales. The move marks a departure from Amazon’s current policy which restricts interaction between sellers on the site and buyers to matters such as returns and delivery date estimation. The change may give sellers on Amazon more direct power to market to customers. 

Scam Ads are Slipping Through Facebook and Google’s Nets

Facebook and Google are failing to crack down on fraudulent ads, even after users report them, says research from British consumer platform Which?. According to the study, 34 percent of people who reported a scam ad to Google said that it was not taken down, for Facebook this figure was 26 percent. While Google was found to have a worse reaction to reports, users were more likely to encounter fraudulent ads on Facebook. 27 percent of those in the study said that had encountered a scam ad on Facebook, compared to 19 percent on Google. 

Sports Media Startup Overtime Makes $80 Million from Investors

Overtime, a sports media startup has made $80 million from its investors, which include Amazon CEO Jeff Bezos, rapper Drake and Reddit founder Alexis Ohanian. The company delivers sport content on platforms like Instagram and YouTube. In information obtained by Insider, the company says it is successfully reaching young sports fans, and aims to increase its annual revenue to $200 million by 2024. 

Facebook Says It is Now a Credible TV Competitor

Facebook has claimed it is now “a very credible competitor” to broadcast and other ad-supported TV channels, as it expands its video media offering to brands. Ian Edwards, global connections planning director at Facebook said that the social media site’s in-stream ads now reached two billion people every month. “Facebook is now a very credible competitor and option for video advertising,” Edwards told The Drum. 

Spotify Posts Strong Subscription Gains

In Q1 2021, Spotify reported 356 million monthly active users, up 24 percent from the previous year. In terms of paying subscribers, those grew to 158 million, up 21 percent from the same period last year. Spotify has said uncertainty lies ahead, as markets it had hoped to expand in, such as India and Brazil, face ongoing pandemic spikes. 

The Week for Agencies

WPP Launches Consolidated Data Business Choreograph

WPP this week launched a new data business called Choreograph, which brings together the specialist data units of GroupM and Wunderman Thompson. WPP says the new unit will “help clients realize the value of their first-party data, consult on and implement their data and technology strategies, and advise on privacy-first approaches to navigate the fast-changing data landscape”.

IPG Posts 1.9 Percent Organic Net Revenue Growth

Interpublic Group was the last of the big four holding groups to report its Q1 financial results this week, announcing that organic net revenues were up 1.9 percent year-on-year. Overall net revenues reached $2.03 billion, up 2.8 percent. “Our strong start to the year reflects the quality of our talent, across the organization, and underscores the successful evolution of our offerings at a time of accelerating, transformational change,” said IPG CEO Philippe Krakowsky.

UK Ad Market on Course for World’s Strongest Recovery

The UK ad market is on course to bounce back from the pandemic faster than any other market in the world, according to data from the Advertising Association (AA) and Warc. The two organisations forecast that UK ad spend will grow 15.2 percent this year, marking a full recovery from the pandemic.

WPP Returns to Organic Revenue Growth

WPP beat analysts’ expectations in its Q1 financial results, posting a return to organic revenue growth of 3.1 percent. “Our strengths in ecommerce, digital media and technology, combined with our ongoing investment in creative talent, are resonating with clients as their markets recover and they seek to transform their offer for future growth,” said WPP CEO Mark Read.

Hewlett-Packard Enterprise In-Houses “Significant Portion” of Advertising Business

IT brand Hewlett-Packard Enterprise is moving to in-house a “significant portion” of its advertising business, according to a report from Business Insider. HPE’s advertising accounts, currently mostly held by Publicis, are said to be worth up to $100 million according to Business Insider’s sources.

VMLY&R Retains US Navy Account

The US Navy announced this week that it is retaining WPP-owned VMLY&R as its agency of record. The US Navy account is worth over $450 million according to Adweek.

The Time That CMOs Spend In Their Post Shrinks Again

The amount of time that chief marketing officers (CMOs) spent in their job again declined in 2020, according to research from executive search firm Spencer Stuart. The average time a CMO  spends in post at 100 of the top US ad spenders shrank to 40 months last year, down from 41 in 2019, the annual study found. The median tenure for CMOs was 25.5 months, dropping from 30 months in 2019. These figures are much lower than the time than other executives spend in-post; for example, the average for CEOs is 80 months and the median is 50.

Hires of the Week

Peacock Names Jim Denney Chief Product Officer

NBCUniversal has named Jim Denney executive VP and chief product officer for Peacock. Denney joins Peacock after previously leading Hulu’s product organization as vice president of product management.

ID5 appoints Joseph Quaglia as VP Sales and Business Development

Joseph Quaglia is joining ID5 as the company’s first ever US based hire. He will join the ID5 team as VP sales and business development. Quaglia was previously at IRIS.TV where he led strategy, sales and business development efforts for their data partnerships

GB News Hires David Weeks as First Commercial Director 

GB News has appointed David Weeks, as its first commercial director. GB News is a new British current affairs channel that does not yet have a launch date. Weeks is former executive director of The Week. 

Kedma Pognon Brown Joins Dentsu Media as Chief Operating Officer

Dentsu has hired Kedma Pognon Brown as its chief operating officer for its Americas media service line. Brown joins having held multiple positions at Publicis. 

This Week on VideoWeek

Why Haven’t FAST Services Taken Off in Europe? read on VideoWeek

Roku Accuses YouTube of Anti-Competitive Behaviour in Carriage Dispute, read on VideoWeek

Here’s How Mobile Publishers Are Trying to Convince Users to Opt-In to IDFA, read on VideoWeek

Media and Data are Driving Recovery for the Big Four Holding Groups, read on VideoWeek

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