Last Week in Advertising: Growth, exits and more…

Ad spending is growing, startups are exiting, FCC is wobbling, tech giants are improving user experience (and prying more). Read more about what is happening in the exciting world of Advertising Tech in the second edition of this newsletter. Enjoy!

China Is The New Ultimate (Opaque) Ad Tech Exit, an ad-tech company that supports publishers by connecting them to relevant ads via their Yahoo! Bing network, is set to be acquired by Miteno Communication Technology, a Chinese tech conglomerate for $900M USD. Earlier this year, two mobile ad-tech startups were scooped up by Chinese firms — NativeX by Mobvista for $24.5 million and Smaato by Spearhead Integrated Marketing Communication Group for $148 million. Another mobile ad startup AppLovin is currently in talks with a Chinese buyer for an acquisition of around $1.5 billion. Potential acquirers in China believe Chinese currency will weaken over the next couple of years, which means that a US dollar today is cheaper than it will be a few years down the line. However, it’s not always clear who is the ultimate source of money for these conglomerates. This opacity brings risk, which makes getting acquired by a company in China into a risk/reward situation.

U.S. Ad Growth To Hit Record $178 Billion

The U.S. advertising market is expected to grow at its fastest rate since 2010 — nearly 6%, double the amount projected for the overall U.S. economy. U.S. TV spending will rise 6.6% to $68 billion this year, due to increased spending with the Rio Olympics and the U.S. presidential election. In 2015, U.S. TV advertising market sank 3.5% versus 2014. U.S. digital media spending will grow at over double the rate of TV — 13.7%. In 2017, with no Olympics or political advertising, TV advertising will decline again, sinking 4.5% to $65 billion. Digital media will continue its steady rise — 12.5% — next year to $76 billion — with half of that going to mobile platforms.

Google will soon start punishing mobile sites that show hard-to-dismiss popups

Starting on January 10, 2017, the company will start punishing mobile pages that show intrusive interstitials when a user first opens a page and they will rank lower in its search results. It’s worth noting that Google won’t punish all sites that uses interstitials — only the ones that make content less accessible. That means popups that covers the main content after users navigate to a page or as they are looking through it, as well as standalone interstitials that have to be dismissed before you can access the main content and pages that show what looks like a standalone interstitial above the fold.

Facebook improves its “lightweight video” Slideshow ads, including support for mobile ad creation

Slideshow ads launched in October with the goal of offering a video-like ad experience to markets where videos would be slow to load. Advertisers will now be able to create these ads right from their phones, as well as take advantage of new features like the ability to add text and music, as well as more photos, including Facebook’s own stock image library. One customer using Slideshow ads, a sock company called Stance, saw their cost per acquisition decreased by 48% compared with photo link ads, the click-through rate increased 2.42 times, and their return on ad spend increased by 1.48 times. Other early adopters include Coca Cola, Netflix and Unilever.

WhatsApp To Share Your Data With Facebook Now

WhatsApp data that will be shared under the new T&Cs includes the phone number a user used to verify their account, and the last time they used the service. WhatsApp will also be sharing the data with the “Facebook family of companies” — so presumably its user data could also be fed to VR firm Oculus Rift and photo-sharing network Instagram. There is an option to opt out of some of the data sharing, specifically for ad and product purposes.

FCC Wobbles On Cable Box Bust-up, In Nod To MVPDs

In Feb of this year, Federal Communications Commission (FCC) approved a proposal to give consumers more choices in the set-top boxes they use to watch cable TV. Pay-TV operators from the cable, satellite, and telco industries would have to provide content and programming information to makers of third-party hardware or applications. Theoretically, customers could then watch their TV channels on various devices without needing to rent a set-top box from their cable company and without buying equipment that is compatible with a physical CableCard. Recently however, it appears the FCC is starting to listen to programmers and multichannel video programming distributors (MVPDs). National Cable & Telecommunications Association (NCTA) filed acounterproposal in July that would keep cable-owned content locked, in theory, but extend access to a cable provider’s content via an HTML5 app. In this scenario, a third-party device manufacturer like Google (via Chromecast) or Apple wouldn’t have direct access to Comcast-owned content — but rather a Comcast-owned app. This would prevent third-party device manufacturers from freely adding their own branding, logos or ads into programming owned by the MVPD.

Read the first installation of this newsletter here.

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