The WIR: Video Ad Spend Predicted to Overtake Social, Police Raid Dentsu Offices Over Ongoing Olympics Scandal, and Lightbox Completes Seed Funding Round

Tim Cross 25 November, 2022 

In this week’s Week in Review: Omdia predicts video ad spend will overtake social in 2025, Lightbox completes its seed funding round, and police raid Dentsu’s offices.

Top Stories

Video Ad Spend to Overtake Search by 2025, Finds Omdia
Online video is the fastest-growing segment in digital advertising, according to Omdia. Ad dollars spent on video will overtake adverts attached to text-based articles or search results by 2025, the research showed. The firm additionally found that Amazon, Google, Meta and Apple will take 68 percent of $500 billion in revenues generated from online advertising this year.

Marija Masalskis, senior analyst for TV, video and advertising at Omdia, warned that “online and TV companies are now competing for the same ad dollars.” Facebook now makes more money from video-based advertising than any broadcaster, she explained, owing to the value of first-party data in a GDPR-compliant, cookieless digital landscape. 

“Historically, when you thought about the big [video-based] media companies, you thought about broadcasters,” Masalskis told the FT. “But now they are small compared to companies like YouTube and Facebook [and] the most significant part of this story is how huge [the respective parent companies] Google and Meta have become in comparison with the big TV brands.”

Police Raid Dentsu Headquarter Over Olympics Scandal
Ad agency Dentsu’s Japanese headquarter were raided by Tokyo prosecutors this week as part of an ongoing corruption investigation relating to last year’s Olympics. Dentsu shares fell by over four percent after the news was reported on Thursday.

Dentsu helped Tokyo win its bid to host the Olympics, and former Dentsu executive Haruyuki Takahashi played a big role in helping award contracts and bring in sponsors relating to the event. He is alleged to have accepted bribes and rigged bids during this process. This included taking money from potential sponsors and from venues seeking to host portions of the games.

Takahashi is now in custody, and Dentsu says it is fully cooperating with the investigation.

LightBox TV Announces £1 Million Joint Funding Round
CTV ad tech firm LightBox TV has secured £1 million in a joint funding round led by FirstPartyCapital and AperiamVentures. The company aims to address fragmentation within the CTV sector, using technology built to help marketers target, measure and activate campaigns in real time.

FirstPartyCapital said the funding round was “packed full of industry insiders”, due to the prior adoption of LightBox TV by holding groups, independent agencies and direct clients. “It is no surprise that the company has already received interest from strategic acquirers that are eager to add capabilities in the fast-growth but highly fragmented data-driven TV space,” commented Rich Ashton, managing partner at FirstPartyCapital.

LightBox TV added that the investment would be used to continue building the platform and simplifying the CTV landscape. US-based AperiamVentures also noted the “transatlantic approach to ad tech investing” demonstrated by the joint funding round. Disclosure: Vincent Flood, Editor-in-Chief and Owner of VideoWeek, invested in the round in a personal capacity.

The Week in Tech

Roku Announces Layoffs, Forecasts Q4 Decline
Roku announced layoffs this week due to economic pressures, reducing its headcount by around 5 percent. “This will affect approximately 200 employee positions in the US,” Roku said in a statement. “Taking these actions now will allow us to focus our investments on key strategic priorities to drive future growth and enhance our leadership position.” The company also forecast a year-on-year decline for Q4 amid ailing consumer spend and advertising budgets.

Meta Faces “Surveillance Advertising” Lawsuit in UK
Meta is facing a fresh privacy lawsuit in the UK over its harvesting of personal data for targeted advertising. Technology and human rights campaigner Tanya O’Carroll filed the suit at London’s High Court, accusing Facebook of surveillance advertising. “A win could set a precedent for millions of users of search engines or social media in the UK and EU who have been forced to accept invasive surveillance and profiling to use digital platforms,” she said.

ShowHeroes Partners with Scope3 on Carbon Measurement
ShowHeroes has partnered with Scope3 for the launch of ShowHeroes Green Media, allowing advertisers to measure the carbon footprint of their video campaigns using data from Scope3. These emissions can then be offset through Scope3’s portfolio of carbon removal projects. “It’s no secret that a single digital ad campaign can generate hundreds of tons of carbon dioxide,” said Showheroes CEO Ilhan Zengin, “and we in the media industry must come together to address this damage.”

Marking Science Brings CTV Planning Platform to UK
Making Science has launched Gauss Connected TV, integrating planning and reporting to help UK marketers manage the distribution of investment between media and channels. The product provides insights on cost by channel, as well as incremental reach of CTV over linear. “Today’s CMOs face the task of managing budgets across multi-channel campaigns, alongside pressure to optimise sales and demonstrate which efforts move the needle,” said Jorge Alonso, Products and Tech Solutions Director at Making Science. “Bringing Gauss to the UK audience means more companies can make the right decisions at the right time for success.”

Disney Ousts CEO Bob Chapek
Disney executives ousted Bob Chapek this week, replacing the CEO with his predecessor Bob Iger. According to sources quoted in the FT, the coup came in response to a turbulent tenure for the Disney boss who reportedly marginalised “Iger loyalists” and oversaw a 40 percent drop in stock price. Reports suggest the final straw was the company’s Q3 earnings, which saw the streaming business lose $1.5 billion and Chapek announcing job cuts. Upon return, Iger dismissed Disney streaming boss and Chapek ally Kareem Daniel.

Musk Pulls Twitter Subscription Service, Reinstates Ye
Elon Musk has pulled the relaunch of Twitter’s subscription service, whose initial rollout was thwarted by users impersonating brands and celebrities. Musk slated the relaunch for 29th November but has apparently failed to iron out its flaws. Also this week, Twitter reinstated Kanye West’s account, which was suspended for antisemitism. Musk said that Donald Trump would be allowed to return too, but Trump declined, sticking with his own platform Truth Social.

The Week in TV

YouTube TV Subscribers Sue Disney Over Price Hikes
YouTube TV subscribers in the US have filed a class action lawsuit against Disney, claiming the media giant leverages its ownership of Hulu and ESPN to drive up subscription prices. The suit alleges that Disney’s carriage agreements include clauses (for example stipulating that lowest-price bundles must include ESPN) that put upward price pressures on rival services. The plaintiffs argue these deals have almost doubled the YouTube TV subscription cost since 2019.

Italian TV Market to Contract This Year
The Italian TV market is set to contract by 1.1 percent in 2022, ITMedia Consulting has found. Research suggests the pay-TV segment will grow by 4.4 percent, and OTT is expected to expand from 11.6 million households in 2022 to 13.8 million in 2024. ITMedia Consulting predicts market growth at an average annual rate of 2.3 percent over the next two years. Sky Italia, Mediaset and Rai will account for 69 percent of the total TV market in 2024 but will lose share to other players, who will account for over 30 percent of the total, according to the report.

Vevo Brings FAST Channels to Plex
Vevo has partnered with Plex to launch FAST channels on the global streaming platform. The deal brings the 24/7 linear music video channels to the Plex platform, available in the UK, US, Canada, Australia, New Zealand, Germany, Italy, Spain, France and Mexico. “Plex is another big free ad-supported streaming TV partner for us,” said Rob Christensen, senior vice president, global advanced TV at Vevo. “FAST viewing is really taking off because people want relevant, curated content for a more lean-back experience at home. This viewing experience also affords better audience engagement for our advertising partners.”

AVOD Revenues to Reach $91 billion in 2028
Global AVOD revenues will reach $91 billion in 2028, according to Digital TV Research, up from $38 billion in 2022. Hybrid tiers by Netflix, Disney+, HBO and Paramount+ are forecast to generate a quarter of that total. Meanwhile Omdia has projected TikTok to attract 37 percent of all online video advertising revenue by 2027, more than both Meta and YouTube combined.

Canal+ to Buy Orange Pay-TV Network OCS
Canal+ is closing in on a deal to acquire the pay-TV and film assets of French telco Orange, Les Echos has reported. The Vivendi-owned broadcasting group already owns a 34 percent stake in pay-TV division OCS, while Orange Studios is expected to be folded into StudioCanal, the broadcaster’s production and distribution arm. OCS is reportedly in heavy debt, and looks set to lose control of HBO content when Warner Bros. Discovery launches its new streamer in France.

Hasbro Explores eOne Sale
Hasbro is exploring a sale of its film and TV business eOne, home of Peppa Pig and PJ Masks. The toymaker bought the Canadian entertainment company for $4 billion in 2019, but activist shareholders have expressed concern over the acquisition’s value. “We received interest from several parties for the part of the eOne television and film business that while valuable is not core to our go-forward strategy,” said Hasbro CEO Chris Cocks, who took over in February.

Miriad Integrates Pinterest Ads into Channel 4 Content
In-content advertising company Mirriad has teamed up with Pinterest and Channel 4, to run its “Pinterest do” campaign on virtual out-of-home signage within every episode of this year’s Location, Location, Location. The placements form part of Pinterest’s “3-ways into TV” strategy, comprising linear/VOD, dual screening and in-content via Mirriad. “Pinterest has moved beyond the boundaries of traditional advertising in a way that appeals to our viewers and increases performance,” said Chanelle Stacey, Commercial Partnerships Senior Lead at Channel 4.

The Week for Publishers

National World Decides Against Reach Acquisition
UK news investment business National World has decided against an attempted acquisition of fellow publisher Reach. National World said it had received financial support for a deal, but decided against it due to unspecified unfavourable circumstances.

Reddit Upgrades its Video Player
Social sharing platform Reddit made another series of tweaks to its video player, as it seeks to expand video functionality on the platform. Reddit says it has made it easier to read comments on mobile while still watching a video, and has introduced an infinite scroll feature which will show a series of videos posted on the same subreddit. Performance has also been improved, with daily mobile playback errors down by 68 percent since June.

News UKs Digital News Tax Fight Reaches Supreme Court
News UK’s fight with UK tax collector HMRC over whether VAT should be charged on digital editions of its newspapers has been taken to the UK’s Supreme Court. News UK has paid VAT on digital revenues, but believes they should be zero-rated since print newspapers are zero-rated, as the products are virtually the same. UK law has now changed so that digital versions of newspapers are zero rated too, but News UK is seeking to claim back its previously paid VAT.

Euromoney Set for Split After PE Buyout
Private equity groups Epiris and Astorg have completed their £1.66 billion buyout of financial publisher Euromoney. The company will now be split between the two owners: Astrog will take control of the Fastmarkets division, while the asset management and financial and professional services division will be controlled by Epiris.

Rolling Stone UK Cuts Staff One Year After Launch
Rolling Stone UK, which launched last year after Stream Publishing signed a licensing deal will Rolling Stone owner Penske Media, has cut staff due to difficult commercial circumstances. Both the online editor and features editor have been cut, according to Press Gazette.

BuzzFeed Expands its Events Business
Digital-first publisher BuzzFeed is expanding its events business, as it grows revenues outside of advertising. ComplexCon, based on its Complex brand, will be launched in three new cities across Europe, Asia and Australia, alongside broader expansions of its events business.

B2B Publisher Mark Allen Group Grows its Ad Revenues
B2B publishing business Mark Allen Group posted strong financial results this week showing sustained ad revenue growth. For the financial year ending March 31st 2022, turnover was up 37 percent to £60 million. And ad revenues were up to £26.1 million, up from £21.4 million in the previous year.

The Week For Agencies

Harman International Consolidates Advertising and Media with Havas
Harman international, owner of audio electronics brands including JBL, Revel, and AKG, has consolidated its global advertising and media operations with Havas Group. Havas was already responsible for either creative or media for a few Harman brands, but now Havas has been appointed as agency of record for all Harman brands.

Sorrell Remains “Relatively Optimistic” Despite Economic Conditions
Sir Martin Sorrell, executive chairman of S4 Capital, says he remains “relatively optimistic” about his company’s prospects for the year ahead, despite current economic turmoil. Sorrell told investors he expects clients to invest further down the funnel next year, which he believes will play to S4’s strengths.

Horizon Media Strikes SPO Deal with PubMatic
US independent media agency Horizon Media has struck a supply path optimisation deal with supply-side platform PubMatic, AdExchanger reported this week. Horizon struck a similar deal with Magnite earlier this month, as part of an effort to whittle down the number of sell-side partners it works with.

IPA Partners with Snapchat to Bring Young Talent into Advertising
IPA President Julian Douglas is launching a competition for all teens taking part in the industry’s nationwide careers open day Advertising Unlocked, to create a real-world ad campaign that will roll out on Snapchat early next year. The brief for the competition is for the ad industry to tackle the environmental issue of litter dropping in the UK which is on the rise post lockdown – the winning work will be chosen by a panel of industry experts and will roll out on Snapchat in 2023 thanks to the platform providing free media space.

Netflix Reviews UK Media Account
Netflix is reviewing its media account in the UK, Campaign reported this week. WPP’s Wavemaker is the incumbent, and Campaign reports that AAR has been appointed to handle the review.

UM UK Chief Set to Depart
Rachel Forde, CEO of UM London, has announced she is stepping down from the role after more than four years in the role. Chris Skinner, currently president of UM EMEA, will take over UM leadership in the UK and Ireland.

Hires of the Week

Maria McCann Joins Ofcom Content Board
Maria McCann has joined the Ofcom Content Board for a three-year term. McCann has experience in content and regulation in accordance with BSA and the Broadcast Act, both as a producer/publisher and in an advisory capacity.

Brendan Kilcawley Named UKTV Ventures Director
UKTV has promoted Brendan Kilcawley to Director of UKTV Ventures, where he leads the network’s “airtime for equity” investment fund. A former sales exec at BBC Studios, Kilcawley moved to UKTV in 2016 as Head of Distribution, before joining UKTV Ventures in 2021.

This Week on VideoWeek

The Social Notworking: How Meta Botched its Facelift, read on VideoWeek

CTV Gains but Linear Loses from Brands’ Budget Pullbacks finds ISBA, read on VideoWeek

Where Can Advertisers Aim for Younger World Cup Viewers? read on VideoWeek

Study Finds 15 Percent of Ad Spend on High-Carbon, Low-Visibility Websites, read on VideoWeek

Salto’s Struggles Highlights Difficulties for Streaming Joint Ventures, read on VideoWeek

Ad of the Week

Bleacher Report, Unreal World Cup

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About the Author:

Tim Cross is Assistant Editor at VideoWeek.
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