The Big Story
In the midst of battling big tech, the US Congress has just introduced a new bill, “The AMERICA Act,” which aims to force big tech giants such as Google, Facebook, Amazon, and Apple to divest portions of their advertising business units. This means that companies processing over $20 billion in digital ad transactions will not be able to own more than one part of the digital ad ecosystem. Ad exchange owners cannot own supply-side platforms or demand-side platforms, and buyers and sellers of digital advertising cannot own a demand-side or supply-side platform.
If the ‘AMERICA Act’ passes, it will definitely have an impact on the big ad platform conglomerates. Google, Facebook and Amazon may be required to divest large portions of their advertising businesses that facilitate a large share of ad revenue. For Google specifically, this could possible mean giving up their supply-side platform (Google Ads Manager) or their demand-side platform (Google Marketing Platform) since this bill would rebuke their ownership of both a SSP and DSP simultaneously.
While there is no certainty about what will happen in digital advertising, there are both potential positive and negative impacts that could affect advertisers. On one hand, a forced business divestiture could mean additional opportunities for new ad platforms to emerge, diversified advertising reach, lower CPCs, and improved transparency reports from the companies. On the other hand, machine learning has become an integral part of advertisers’ strategy, relying heavily on platforms that use AI, meaning that if these platforms were to divest, sell, or transfer years of machine learning to other parties, it could potentially harm advertising performance in the short and long term.
The ‘AMERICA Act’ bill may cause some turbulence in the digital advertising world, but it is ultimately aimed at promoting competition and preventing conflicts of interest. It remains to be seen whether this bill will pass, but it’s something that advertisers and digital marketers need to keep an eye on.
Instagram has announced that users can now add up to five links in their bio, a highly requested feature. This update expands the platform’s capacity to drive traffic and allows creators and users to promote their passions, causes, brands, businesses, and more. The new feature is displayed on the user’s Instagram bio and shows how many links are available. When tapped, users can view an overview of the links that the user has enabled. This feature may be bad news for third-party link aggregator tools like Linktree, which will lose paid subscribers as Instagram users can now replicate that capacity within the platform. This update benefits users, brands and creators by allowing them to drive traffic to various URLs to maximize their brand presence. Adding multiple links to an Instagram profile is easy, and users can drag and drop to order their links as they wish.
As a way to pump revenue into Twitter, Elon Musk has officially ended its legacy blue checkmarks that were used to verify public officials, celebrities, and journalists for free. The new blue checkmark system is only for paid users, businesses, government entities, and officials. Users with the new blue checkmark now get a boosted ranking in conversations and search, while also receiving greater prominence in their replies. Many critics are arguing that maintaining influence or presence on the platform will now come at a cost and are debating leaving the platform all together. This effort, which has been Musk’s goal since his takeover of Twitter, unraveled to cause quite some chaos. Many users scrambled to prove authenticity to get their verification status reinstated, while others took the opportunity to create fake accounts posing as public figures.
Last year, Facebook’s parent company, Meta, agreed to settle a class-action lawsuit that accused them of sharing user data and making it accessible to third parties without users’ permission. The suit was first filed in 2018 after it was revealed that Facebook was sharing data with the data and political consulting firm, Cambridge Analytica. The breach allowed Cambridge Analytica to access the social media activity of millions of US Facebook users to build voter profiles and aid former President Donald Trump’s 2016 campaign. Facebook users in the United States who used the platform between May 2007 and December 2022 can apply to claim their share of a $725 million settlement. Users can apply for their payout on a claims website, but the amount will depend on the number of valid claims submitted and the length of time each user was on Facebook during the covered period.
Microsoft plans to drop Twitter from its advertising platform at the end of April. “Starting on April 25, 2023, Smart Campaigns with Multi-platform will no longer support Twitter,” said Microsoft. Traditionally, Microsoft’s advertising platform offered a free feature where advertisers could manage all of their different social media accounts in one place. Going forward, users will no longer be able to access their Twitter account in its Digital Marketing Center’s social media management tool. Users will also now be unable to schedule, create, or manage tweets or tweet drafts. Users will also not have access to review their past tweets and engagement through the platform.
Google has recently given an update on their post-cookie ad tech plans. The company is currently working on developing alternatives to third-party cookies, which are set to be phased out at the end of 2024. Google’s approach focuses on Privacy Sandbox, a set of APIs that allow advertisers to target users without collecting personally identifiable information. In early tests, Google reports that ads performed almost the same as ads using cookies. In addition, Google is also exploring the use of Federated Learning of Cohorts (FLoC) as an alternative to cookies. FLoC groups users based on their browsing behavior, allowing advertisers to target groups rather than individuals. However, this approach has faced criticism over privacy concerns. Overall, Google’s post-cookie ad tech plans are aimed at striking a balance between privacy and effective ad targeting.
In January, The Department of Justice filed for an antitrust lawsuit against Google for violating the Sherman Antitrust Act, which prevents companies from participating in practices that harm competition. There are now a total of 17 states that have joined forces with the DOJ’s antitrust lawsuit against Google over its digital ad technology. The DOJ announced that the Attorneys General of Arizona, Illinois, Michigan, Minnesota, Nebraska, New Hampshire, North Carolina, Washington, and West Virginia joined California, Colorado, Connecticut, New Jersey, New York, Rhode Island, Tennessee, and Virginia in the antitrust lawsuit against Google. “When website publishers get less ad revenue because of Google’s monopolies, they have to either lower the quality of their website, or pass on costs to consumers,” stated New York Attorney General Letitia James. Both advertisers and publishers eagerly await the ruling of this case as it will have the ability to shake things up in the space.