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The WIR: Netflix Ad Prices Emerge, Nielsen Goes Private, and Samsung Doubles Down on FAST

Tim Cross 02 September, 2022 

In this week’s Week in Review: Rumours circulate around the cost of advertising on Netflix, Nielsen shareholders approve its sale to private equity, and Samsung revamps its streaming service.

Top Stories

Netflix Ad Rumours Spell Value for Consumers, Costly for Brands
Details of Netflix’s ad-supported plans finally began to emerge this week, including rumours of subscription pricing and the potential cost for advertisers, plus key hires for its advertising business.

According to Bloomberg, the streaming giant is pitching its new ad-supported tier at $7 to $9 a month. The price is around half that of its current ad-free offering. Sources suggest the streaming service plans to sell a relatively slight four minutes of commercials per hour, in the form of 15- and 30-second ads appearing before and during some titles.

Ad buyers said the company is seeking to charge advertisers approximately $65 CPM, substantially higher than most other streaming platforms, the Wall Street Journal reported. The sources added that Netflix wants to cap the amount any brand can spend annually on its platform at $20 million, in order to stop its users from repeatedly seeing the same adverts. Netflix clarified in a statement: “No decisions have been made.”

The company also snapped up two advertising executives from Snap during a period of turmoil for the Snapchat owner (more on that below), “poaching two people that lent the social media company credibility with brand marketers,” according to Reuters. Snap’s chief business officer, Jeremi Gorman, becomes president of worldwide advertising at Netflix, while Snap’s vice president of ad sales, Peter Naylor, takes on the same role at the streaming service.

Nielsen Approves Private Takeover 
Nielsen has reached approval for its acquisition by a private equity consortium led by Elliott Management and Brookfield Asset Management. Shareholders approved the $16 billion deal on Thursday, an all-cash transaction valued at $28 (€27.93) per share. The takeover will see Nielsen become a private company, its shares no longer traded on the New York Stock Exchange.

The measurement firm accepted the offer in March following a wave of uncertainty for the company, which has come under fire for its methodology and relevance in the streaming age, losing its Media Rating Council (MRC) accreditation last year. The transaction is expected to close in October 2022, subject to customary closing conditions.

Samsung Doubles Down on FAST
Samsung unveiled a new version of Samsung TV Plus, the early FAST (free ad-supported TV) adopter first launched in 2015. The revamped streaming offering will be available on all Samsung Smart TVs and Galaxy devices made between 2016 and 2022.

The FAST model is on the rise in the US as pay-TV subscriptions fall and SVOD services struggle to hit subscriber targets. Samsung TV Plus has seen 100 percent growth in consumer viewing in the past 12 months, according to the company. The streamer has partnerships with A+E Networks, E.W. Scripps and BBC Studios, and carries national and local news tailored to the viewer’s region across more than 40 DMAs (designated market area).

“We are thrilled to recognise the massive growth we’ve achieved so far across 24 countries and over 1,600 channels globally,” said Won-Jin Lee, President and Head of the Service Business Team at Samsung Electronics. “Samsung TV Plus’ new brand signifies our continued investment into the future of FAST.”

The Week in Tech

Advertising Slowdown Leads to Cutbacks at Snap
Snap is scaling back investments and slashing staff, following a slowdown in advertiser demand that saw the company’s stock fall by 25 percent. As well as cutting around 20 percent of its workforce, the company is reducing or halting a number of its investments, including Snap Originals, Games and Minis (pared-down versions of third-party apps on Snapchat). Meanwhile two of Snap’s top ad executives, Jeremi Gorman and Peter Naylor, have departed the social media firm to join Netflix as the streaming giant builds out its ad-supported tier.

German Regulator Highlights Google’s Dominance in Non-Search Advertising
German competition regulator Bundeskartellamt has published a report on non-search online advertising, with the intention of shedding light on the “black box” of programmatic ad tech. The enquiry confirmed that Google holds “considerable influence” on the non-search online advertising sector, highlighting a lack of transparency for publishers, advertisers and users alike. 

“Google controls important parts of the software infrastructure on the user side, such as the Chrome browser and the Android mobile operating system, which ultimately also determine the technical options available for realising non-search online advertising,” said Bundeskartellamt. “Combined with the finding that for outside observers it is difficult to discern how the system specifically works, Google thus has significant power to set rules.”

FTC Sues Kochava for Selling Geolocation Data
The Federal Trade Commission (FTC) filed a lawsuit against Kochava this week, after finding the measurement and verification company to be selling sensitive geolocation data. This includes individuals’ visits to reproductive health clinics, places of worship, homeless and domestic violence shelters, and addiction recovery facilities. “Kochava is enabling others to identify individuals and exposing them to threats of stigma, stalking, discrimination, job loss, and even physical violence,” claimed the FTC. 

Smart Home Usage on the Rise
Smart and IoT device adoption is up 10 percent year on year, according to the Plume IQ Smart Home Market Report. The study of 41 million homes managed by the Plume Cloud across Europe, Japan and the US found the global average number of connected devices per home is currently at 17.1, rising to 20.2 in the US. The report also revealed 84 percent growth in (blocked) botnet cyber threats, 58 percent in malware and 40 percent in spyware and adware.

ASA Targets Sexualised Mobile Game Ads
The Advertising Standards Authority (ASA) has hit out at sexualised advertising within the mobile games industry, often targeting younger audiences. The FT noted that free “hyper-casual” games are particularly vulnerable to declining ad spend, as in-app advertising is their primary source of revenue. Louise Shorthouse, senior games analyst at Ampere Analysis, added that these ads tend to rely on “shock value” to gain attention. “Getting a consumer within the game can be enough for them to profit,” she said. “They simply need eyeballs, not wallets.”

Xperi Launches TiVo OS for Smart TVs
Xperi Holding Corporation announced on Wednesday the launch of its independent media platform, TiVo OS. Billed as a “neutral platform”, TiVo OS is said to hand control of the user experience to original equipment manufacturers (OEMs). Shipments of Vestel smart TVs powered by TiVo will begin shipping in Europe next year, the company confirmed.

CMA Scrutinises Microsoft/Activision Blizzard Takeover
The Competition and Markets Authority (CMA) has raised concerns over Microsoft’s planned purchase of Activision Blizzard, citing potential threats to competition in the gaming sector. Due to Microsoft’s size and Activision Blizzard’s market position, “the CMA is concerned that if Microsoft buys Activision Blizzard it could harm rivals, including recent and future entrants into gaming, by refusing them access to Activision Blizzard games or providing access on much worse terms.” The regulator is proceeding to an in-depth Phase 2 investigation.

Synchronized Brings Smart Ad Breaks to TF1
Synchronized was selected by TF1 to integrate Smart Ad breaks into programming on MyTF1 and TF1’s linear channels. The ad tech firm said the service enables content owners to automatically identify the optimum placement for ad breaks in a video, while ensuring the integrity of the content. Synchronized also provides automated thumbnail creation for the French broadcaster.

The Week in TV

Bertelsmann’s Rabe Urges Regulators to Approve M6/TF1 Merger
Bertelsmann chief executive Thomas Rabe has warned that blocking the merger between M6 and TF1 would have a “profound impact” on the European TV sector, the FT reported on Wednesday. The French competition watchdog expressed concerns that the combined entity would control approximately 75 percent of the French advertising market, but Rabe argues that the definition of a “relevant market” should be broadened to account for streaming giants introducing advertising to their platforms. 

The German broadcaster has been linked to the acquisition of ProSiebenSat. 1, and Rabe worries that blocking the French merger sets a dangerous precedent. “If the authorities decide against this combination, it is a lost opportunity, not only for this year but for the long term,” he said. “If this deal does not go through in France then it is going to be very difficult for a similar deal to go through in Germany and other countries.”

Canal+ Drops TF1 Over Payment Row
Canal+ will cease broadcasting TF1 channels due to the latter’s “unreasonable” payment negotiations, Canal+ Group has announced. The Vivendi-owned broadcaster accused TF1 of leveraging its dominance to demand “substantial remuneration” for its free channels. The Bouygues-owned network hit back, blaming Canal+ for “depriving” and “penalising” paying subscribers. TF1 added that it remains open to further discussion.

European Commission Approves RTL/ProSiebenSat.1 Joint Venture
This week the European Commission approved the creation of a joint venture between RTL Deutschland and ProSiebenSat.1’s Seven.One Entertainment Group. The initiative aims to grow the availability and accessibility of addressable TV advertising across Europe. The Commission said the proposed merger raises no competition concerns, due to the limited revenues and assets of the pairing in the European economic area.

Roku TV Launches in Germany
Roku TV has landed in Germany, following the arrival of Roku streaming players in 2021. Metz Blue and TCL will launch Roku-powered smart TVs in the market from October, the company confirmed. The TVs carry streaming services such as Netflix and Pluto TV, in addition to supporting Alexa, Google Assistant and Siri. Roku TV first came to Europe in 2019 when it launched in the UK.

Warner Bros. Discovery/BT Close Joint Venture Deal
Warner Bros. Discovery and BT closed their joint venture transaction this week, combining BT Sport and Eurosport UK into a new sports brand. The companies said the networks will initially retain their separate product propositions before launching in the market “over time.” The board of directors is an equal split between the two companies, with the chairperson nominated on a rotating basis, starting with BT Consumer CEO Marc Allera.

US Families Turning Away from Linear TV
US families are shifting away from linear TV, a Future Today study has revealed. The report found that 62 percent do not have access to linear TV, and 90 percent say they rarely watch it. According to parents, 60 percent of children who see adverts talk to them about the ads afterwards, and 52 percent ask them to buy what they saw. “Kids are the CEO of the streaming household,” said Future Today co-founder Vikrant Mathur. “For brands that are trying to connect with millennial parents, having a presence on Kids & Family channels not only provides a conduit to the entire household but also sparks conversations that create lasting brand equity.”

FanDuel Gambles on Sports Betting Channels
Sports betting firm FanDuel Group is launching a linear TV network and OTT platform this month. FanDuel TV will be distributed by Comcast Xfinity, Spectrum, Verizon FIOS, DirectTV, DISH, Cox Communications, FuboTV, YouTubeTV and Hulu; FanDuel+ on Roku, Apple TV and Amazon Fire. Alongside horse racing, the content includes 3,000 hours of live sports including the professional basketball leagues of Australia, China, France and Germany.

The Week for Publishers

Washington Post Ad Revenues and Digital Subscriptions Stall
The Washington Post is on course to lose money this year, according to a report from the New York Times, as the newspapers ad revenues and digital subscriptions have both stagnated. Digital ad revenue was down fifteen percent in the first half of this year according to the Times. The Post is now considering job cuts, according to the report.

Twitter Launches Tweet Tiles News Feature
Twitter this week began testing a new feature for news publishers called ‘Tweet Tiles’, with the New York Times, Wall Street Guardian, and The Guardian the first newspapers signed up. Tweet Tiles will give publishers more flexibility in how their content appears within their Twitter feeds.

Tribune Reports Limited Impact of Turning Off AMP
Publishing group Tribune’s director of editorial product and strategy Kurt Gessler this week reported on the company’s experience with turning off AMP, Google’s framework for creating more mobile-friendly webpages. Gessler said in a blog post that Tribune stopped using AMP after Google said it was no longer a requirement for articles appearing as ‘Top Stories’ in Google News. Gessler said Tribune saw “very manageable declines in mobile search referrals” post-AMP, with search traffic drops averaging at around 12 percent.

Newsquest Closes The National Wales
UK local news publishing group Newsquest has announced it is closing down its Welsh news site The National Wales, eighteen months after it launched. The website was subscription funded, and regional editor Gavin Thompson said subscriptions had fallen over the past year due to the cost of living crisis, making the publication unsustainable.

Reach Journalists Strike After Talks Break Down
Journalists from UK publisher Reach went on strike this week, as talks between trade union representatives and Reach executives broke down. Reach journalists have been campaigning for bigger pay rises than those they’ve been promised, given current rates of inflation.

The Week For Agencies

WPP Buys Ecommerce Consultancy Newcraft
WPP this week announced that it is acquiring Newcraft, a European ecommerce consultancy based in the Netherlands. Newcraft, whose clients include Ahold Delhaize, Pon Holdings, and Yakult, will be folded into the Wunderman Thompson global network.

P&G Adds its Support to UID 2.0
FMCG giant P&G has become the latest major buy-side player to throw its support behind The Trade Desk’s UID 2.0 identity framework, another win for the popular alternative identifier. “P&G supports new solutions like Unified ID 2.0 that are designed to help improve the U.S. consumer advertising experience,” said P&G’s senior director of global brand building and media innovation Eric Austin. “Advertisers and publishers need a consumer-centric identity solution that will raise the bar on privacy.”

Publicis Groupe Signs Up to Change the Lens
Change The Lens, a group which seeks to ensure proportional representation of Black creatives within the commercial and music video film industry, has extended its scope to cover advertising agencies. Publicis Groupe has been the first agency group to sign up to Change The Lens’ ‘15%+ Pledge’, which requires agencies to have at least fifteen percent Black employees, across all levels and departments.

Creatives Protest Fossil Fuel Work Outside WPP and Edelman Offices
Creative network Glimpse this week staged a protest outside WPP and Edelman’s offices in London, protesting against marketing agencies’ work with fossil fuel clients. The campaign, ‘Wreck the Brief’, encouraged those in the industry to “Delay, Dither, Bungle,” in order to sabotage fossil fuel campaigns.

ASA Hands Unilever Greenwashing Ad Ban
The UK’s Advertising Standards Authority this week handed Unilever-owned brand Persil an ad ban for its ‘Dirt is Good’ TV campaign, which emphasised the company’s sustainability credentials. “We acknowledged Persil [was] undertaking actions to reduce the environmental impact of their products, [but] we had not seen evidence or analysis to demonstrate the overall environmental impact of the featured liquid detergents over their full life cycles, compared with Persil’s own previous products or other products, in support of the claim “kinder to our planet,” the ASA said in its ruling.

Wendy Clark to Step Down as Dentsu CEO
Dentsu International global CEO Wendy Clark is stepping down after two years in the role. Dentsu said it would restructure the leadership in preparation for the future following her departure. “A cross-functional global team of our Executive leaders has been working on our long-term roadmap for Dentsu,” the agency said in a statement. “We expect to communicate more fully as we finalise this planning process.” No timeline has been given for Clark’s exit.

Havas Entertainment Wins Rémy Cointreau’s UK and Ireland Media Duties
Drinks brand Rémy Cointreau has awarded media duties in the UK and Ireland to Havas Entertainment, following a competitive pitch process. The account was previously handled by IPG media agency UM.

Hires of the Week

Netflix Snaps Up Snapchat Ad Execs
Netflix has hired Jeremi Gorman, formerly chief business officer at Snap, as its new president of worldwide advertising. The streaming giant also brought in Peter Naylor, Snap’s vice president of ad sales. They depart the social media company amid falling stock prices and staff cuts, as Netflix looks to build out its new advertising business.

RTL Deutschland Appoints Board Members
RTL Group announced two new members of RTL Deutschland’s Management Board. Ingrid Heisserer has been named RTL Deutschland CFO and Xenia Meuser CHRO. Heisserer joins from L’Oréal, and Meuser from tech firm New Work. They take up their new posts in December and October, respectively.

Thomas Jacques Joins TF1 Group Executive Committee
Thomas Jacques, TF1 group Head of Technologies, has been appointed to the group’s Executive Committee. Jacques joined TF1 in 2003, then ran Google AdExchange in Europe before returning to the French broadcaster in 2018 as Head of Technologies, helping transform the ad sales business.

This Week on VideoWeek

User Tracking on In-App Browsers: Explained, read on VideoWeek

TF1 and Westfield Offer Hybrid Digital/Physical Ad Campaigns, read on VideoWeek

The Brexit-Led Broadcaster Exodus from the UK Appears to be Complete, read on VideoWeek

Ad of the Week

Gucci, Exquisite

 

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2022-09-02T13:51:44+01:00

About the Author:

Tim Cross is Assistant Editor at VideoWeek.
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