← AdExchanger
AdExchanger
How Publishers Can Place Safe Bets In A Rigged Programmatic Game
00:52:40
For publishers, digital advertising is a lot like playing craps, says Aditude’s Justin Wohl. It’s all about tuning out the noise while placing safe bets that work for your monetization strategy.
Loading summary
Transcript60 lines
- [00:00]
Unknown Speaker
Foreign.
- [00:13]
Anthony Vargas
Welcome to Ad Exchanger Talks, the podcast devoted to examining the issues and trends in advertising and marketing technology that matter most to you.
- [00:24]
Sarah Sluice
This episode is sponsored by iota, a trusted global provider of audience solutions for digital marketing. Ranked number one for global data privacy by Neutronian in 2023, IOTA empowers brands to enrich insights, enhance personalization, and transform omnichannel marketing. As part of the Dun and Bradstreet family, IOTA offers a full suite of solutions to make growth easy. Learn more@ieta.com that's e y e o.
- [00:57]
Justin Wall
T a.com tough to be a publisher in 2025 making money from digital advertising has long been a tricky prospect, but the search and social platforms publishers have long relied on for referral traffic are now trying every trick they can to keep users locked inside their walled gardens. And what traffic still trickles down from these platforms is now under threat from the rise of generative AI search and chatbots. Meanwhile, paid traffic has been demonized by the anti MFA crusade, and middlemen continue to extract revenue from programmatic deals without fully compensating publishers for the value of their data. With the current curation craze being just the latest example, we'll be getting into all these topics and more on this week's episode of Ad Exchanger Talks. I'm Anthony Vargas, Senior Editor for Ad Exchanger and your host for today's episode. Filling in for our usual host, Alison Schiff. Thanks for joining us today everybody, but before we dive in, first a little PSA. Our CTV Connect event is taking place March 12th and 13th in New York City. We'll be covering all the hot topics in connected TV advertising and you won't want to miss it. Head on over to ctvconnect.com to grab your ticket. All right, now back to today's episode. Joining me today is someone you might know as a publisher side thought leader who recently made the jump to Publisher tech. Everybody, please welcome Justin Wall, VP of Strategy at Attitude and the former CRO for Salon, Snopes and TV Tropes to the podcast. Justin, thanks for joining us.
- [02:26]
Anthony Vargas
Hey Anthony, thanks for having me.
- [02:28]
Justin Wall
So Justin, we usually like to start these episodes of Ad Exchanger Talks off with a little known fact about our guest and something I've learned about you from crawling paths at a few Las Vegas events. Now, you're very at home in the casino and you come from a family that loves to gamble. So I was wondering, like, you know, what lessons have you learned at the craps table that apply in programmatic advertising.
- [02:51]
Anthony Vargas
Yeah. I do come from a family of professional gamblers. Both of my dad's parents have done quite well for themselves in their life. Between poker and craps, and when it comes to the craps table, being cautious about the bets that you place is really the name of the game. There are a lot of attractive bets that can be made on the craps table. You know, horn, high, low. There's a lot of things that you'll hear players shouting about that might distract you from whatever you came to the table with as a strategy. And it is a good analogy for the work that we do outside of the casino to have a plan and stick to it.
- [03:29]
Justin Wall
Yeah, really well said. So speaking of kind of like, you know, making a new bet, I guess. In December, you announced that you were joining Publisher Tech Platform Attitude as its new VP of strategy. And that move came after years in publisher monetization. So what kind of motivated that shift for you? And do you kind of feel like, you know, the opportunities on the publisher side are drying up a bit and there's more opportunity on the pub tech side?
- [03:54]
Anthony Vargas
I don't think that opportunity as a publisher dried up, but I did begin to feel the need for scale in what I was doing. I've been working at Single title publications since 2017, and reflecting back on that last eight years or so, I have to say, you know, I did find success as a programmatic publisher. I was able to build up two separate newsrooms at both Salon and Snopes. And I feel good about the work that was done there. Beyond that, I also was able to get some good traction in the industry to talk about the work that was done there, whether it was in the trades or on a stage. And I think that where I was not successful was building the kind of groundswell of adoption amongst my peers that I would have hoped for to see the strategies replicated for the benefit of other publications. And so my move to software is very much with the hopes that I can scale up the work that I had been doing at my Single Titles and bring it to a great many more publications for their future success.
- [05:03]
Justin Wall
And like you kind of alluded to, I mean, you've been pounding the drum for, like, years, really, kind of like evangelizing at a lot of industry events, like how publishers can kind of address some of these monetization challenges they've been facing. And, you know, think like the ecosystem has evolved a lot, like, you know, since you and I first started talking a couple of years ago, even just like, over the past couple of years, there's been a lot of change. So I guess, like, you know, when you look at kind of the ecosystem now and where things kind of stand for publishers, what would you say the top monetization challenges facing publishers in 2025 and beyond are maybe like, you know, top one to three.
- [05:37]
Anthony Vargas
There are two really big requirements for publisher monetization. The first is traffic and audience, and the second is the yield that you can create against that audience. So the challenge that many publishers are having, especially as we look to the end of 2024 traffic patterns, is a decrease in readership. So whether that's because of fatigue against certain content verticals, or whether it's because generative AI and zero click searches have enabled people to get answers faster without going to the long form article where the answer is sourced from, there's a drop in volume available to publishers to monetize against. So that's your first challenge, is maximizing the amount of readership and ultimately that translates to advertising inventory. But then second, sure, the value of advertisements themselves is not a given. There is supply quality consideration for publishers, there is advertiser access and ability for your inventory to be targeted correctly. I mean, these things all are a multifaceted aspect of yield. And so publishers in 2025 will really need to tackle both of these things, continuing to keep the audience they have and grow, find new readership, and then also monetize them as best they can.
- [07:02]
Justin Wall
And we'll definitely touch on a couple of those issues that you just mentioned in more depth, like going forward. But another thing that sort of stands out a lot when you talk about publisher challenges. There's just so much complexity in the ecosystem and especially when it comes to the software that dictates how programmatic advertising works and how publishers really can maximize their yield through that. So like, I was wondering, like, what's the big opportunity for third party publisher tech right now is some of the difficulty facing publishers due to just like that complexity of programmatic advertising, and is there some room for publisher tech to help them overcome some of that complexity?
- [07:38]
Anthony Vargas
You know, I, I do really enjoy the complexity. And so as you're asking the question, I'm sitting here laughing to myself saying, is the complexity a bug or a feature? You know, I think that the complexity offers constant challenge and stimulation. You have the chance to tackle problems from different angles, different approaches, and to varying degrees of success. I think that there is not just one way to go about navigating this, this ecosystem that we work in. So I'm laughing a bit to Myself saying, like, yeah, I enjoy the complexity. But the truth is that the complexity can also be quite derailing for, for a given organization. So whether you as a publisher or as a publishing business have the resources and the bandwidth to develop expertise in the space and constantly chase down each next challenge that programmatic advertising, you know, poses to your business. That's a, that's a case by case kind of thing. And for most publishers it will become distracting in the long term because there are other aspects of the business that have to be run. There is a constant need for making sure that your website looks the best that it can, that the user experience is good, that the mechanisms are in place to retain your audience by promoting newsletters or podcasts or social media follows to them trying to sell subscriptions. So if you're doing all of that while also trying to run a healthy newsroom and keep your content strategy on point, yeah, it's quite possible that outsourcing to third party publisher tech for, for, for your monetization of advertisements, that could be a really good strategic move for a given organization. So I don't know, I, I guess, I guess you could say that it is in vogue again where resources at organizations are being moved around like chips on a board and they may be placed into non monetization buckets internally while seeking the software solutions externally to get the yield that you need.
- [09:53]
Justin Wall
And then speaking of distractions and I guess maybe some of those buzzy things that might be shattered around the programmatic craps table that might distract you from your existing strategy as a publisher. One of the big distractions over the last or so, or maybe not a distraction, but some more of just like a big buzz phrase that's really kind of captured the industry imagination. Curation. We've really seen this like, you know, take over the conversation, especially on the publisher side and like, you know, especially like how like this whole curation discussion has really shifted over to like happening on the sell side where historically it was done more through DSP data marketplaces. But you and I have talked a bunch about how, you know, publishers still feel like they're lacking control over how their inventory is being curated, even though we're seeing this shift to like sell side curation. So what kind of stands out as like the main publisher concerns when it comes to this current curation craze?
- [10:49]
Anthony Vargas
It's possible that the publisher concerns would have been present in other scenarios, but this is the first time that curation has really come to the forefront of publisher awareness in the way that it has over the past few months. The sense that we are already so challenged as publishers to make the money that we need to keep our businesses open definitely raises the sensitivity to finding out that there's more margin opportunity in the supply chain that we didn't participate in as publishers. So you look at the trends of local news and smaller media organizations across the country, closing their doors and closing their shops and having to lay off their journalists over the past many years. This is directly related to the ability to monetize against the audience that you have. I mean before we were talking about the two parts, right? You have traffic and you have how well you can monetize it. And both of those things have been in jeopardy for, for publishers. So to find out that there is a nice healthy data business that exists in the supply chain where folks are able to make a healthy living and stand up their companies, all while publishers are still feeling quite hungry at the receiving end of the transaction, that definitely is going to ruffle some feathers. And I think that's what we saw drive the buzz around curation and all the coverage and conversation about it in Q4 of 2024 especially.
- [12:25]
Justin Wall
Yeah, you raised such an excellent point where you really look at the publisher ecosystem and newsrooms are cutting journalists jobs and all kinds of editorial like across the board local publications. You know, it's been a thing for years where like local news outlets are struggling and shutting down left and right or getting you know, snatched up by like, you know, big, big investors and kind of transformed into, into new things that you know, their original audiences don't quite recognize. And you know, then you contrast that with like what feels like, you know, these like curation tech platforms and like these kind of like middlemen in the marketplace really kind of like thriving right now. And when you look at that contrast, it really just kind of like speak to this like exactly like you were saying, like there was just that like missed like opportunity. Whether it be like in the margins or whatever it was where like it felt like, you know, the storyline was shifting to where publishers were going to have more control over all this curation and be able to like really get like the rewards for that. But it seems like the lion's share of the rewards for this like sell side curation push of really gone to these middlemen which seems to be like the old, the same old ad tech story, right?
- [13:34]
Anthony Vargas
Sure.
- [13:35]
Justin Wall
So like what's kind of like what's kind of like the publisher recourse here? Like is there like a way for publishers to make sure they're getting the most value out of curation, working with the best curation partners.
- [13:48]
Anthony Vargas
The introduction of curation inside of the SSP is something that publishers were offered over the last few years. And I think speaking from my own experience, perhaps didn't even realize fully what the implications were of saying yes or opting into a curation program. I mean the, the idea of an open market representation of your inventory by an SSP makes sense. Like I am directly connected to a given exchange and they are going to put my impression opportunity onto the open market for all of their DSP partners to bid into. Now if a SSP also says rather than just put it all out on the open market for you, we're also going to put together the most viewable inventory that comes through our exchange or all of the basketball adjacent inventory that comes through our exchange and they're going to do a curation of their own around that make it easier for their buying partners to access that inventory through their exchange. That that's kind of the original understanding of curation and how it was presented. The fact that third party companies then put themselves in between the SSSP and the DSP under the guise of curation. I think that's where it changed a bit in, in nature and where publisher understanding was lagging behind the actual technical implementations that were happening.
- [15:23]
Justin Wall
You did. And we've also talked a little bit about how these curated audiences are actually sold in market. Really kind of takes the publisher out of the equation in some ways. For instance, sometimes you see that these curated PMPs are really sold under the curator or the SSP's brand name. And in those instances it's easier a for the curator to kind of ignore the publisher's existing rate cards and pricing floors for, for any inventory that gets funneled into those PMPs. And then also like on the other hand like when those like PMPs actually perform for the advertiser, you're seeing the curator get the reputational boost for that instead of like, you know, the publisher really getting the boost for like okay, my audiences are performing, you know, I can work with this, this advertiser in like deeper ways from there. So like, is there any way for like publishers to kind of like overcome those barriers or is it really just like a function of how this stuff is sold in the marketplace?
- [16:23]
Anthony Vargas
I'm a little wary in the sense that the curator business of today, it's not static. It's certainly going to continue to evolve and I imagine that the technology, the use of AI, the ability to harness data and empower curation, I see that as improving and moving. And so for a publisher to try and just go after the curation business as it was defined in December, it might actually be detrimental to spend resources going after it in that way. I'm more so thinking that no matter what happens with curation, who curates it, what data it's based upon, it's ultimately driving at needing premium quality supply underneath it all. And so the immediate thing that publishers can really consider doing, and certainly where I'm driving from a strategy perspective, is to look at supply quality and to ensure that it is the best that it can be so that we qualify for any kind of curation to come. And there's some, there's some argument that curation is really an adopts function and that curators stepped in between SSPs and DSPs to accomplish something for the buyers that was lacking in their own adopts capabilities, their own ability to tighten up the targeting around their buy or to find the inventory, optimize their campaigns towards performance. These things weren't happening effectively enough. And so curation stepped up to solve a technical need of the buyer. Ad operations. And so publishers also have ad operations. In fact that's where I learned ad operations was from the publisher side working in an ad server, trafficking tags and targeting that using the controls that were available to me against my own inventory. So with a deep understanding of your own inventory, I think publishers can set themselves up for the best success going forward. Looking back at those fundamentals really of viewability, click through rate and performance of your supply, that that's where I would start the year off for sure.
- [18:49]
Justin Wall
And it's such a good point about like not getting bogged down and like you know, the kind of like details about how like curation currently works. Because all this stuff is evolving and it's really kind of a moving target. So like a really glad you brought that up for sure. But like when we look at kind of like you know, the curation conversation, the conversation around like contextual targeting and like whether or not publishers are being cut out of like decisions around how their content is targeted at against and like what signals like contextual platforms are looking at and stuff, whenever we kind of look at like all these like you know, big picture concerns, the thing that it ultimately boils down to is like publishers being smarter about who they're allowing to have code active on their pages and you know, who they're really doing these data integrations with and giving access to their first party data. And you've mentioned a pretty Interesting idea in the past that I'd love to, I would love for you to talk a little bit more about on the podcast. Here is just the idea that publishers should in some way look for compensation from like, partners who are putting code on their page. What would that actually look like in practice? And like, do you think it's really like a practical thing that publishers could lobby for? Or is that really more of like a, you know, in an ideal world, this is how it would work.
- [20:02]
Anthony Vargas
When you look at the data privacy agreements that are signed between publishers and tech providers, they're not directly getting to, here's what we're collecting and here's how we intend to monetize it. Right. The legalese around these agreements is pretty intense and I think that they often get punted up to a legal department or a counsel who can then say, yep, this meets our needs and we're going to sign off to it without ever really having a clear communication around the commercials. And so this is the point that I come back to again and thank you for bringing it up here or giving me a chance to talk about it. The idea that when you put code on your page as a publisher, you are opening the door for that partner to know just about as much about your inventory as you could hope to. And in fact, they may know more about it than you do. Plenty of analytics tools are. Your, your, your understanding of as a publisher is limited to the reporting interface that's given to you, right? So if a UI is lacking or if there are certain data points lacking, it's not because that data wasn't collected, it's just because it wasn't necessarily shown back to you as the publisher. And at that point, when someone in your organization in, in an operations role is hands on with the tool that the contract was signed for by, by the legal department, you could see where there's this distance in between the original understanding of what, what it was and what then kind of happens down the road. As an operator is using a tool, they're limited to what they understand of the tool by the analytics that's given to them, and they then maybe stop thinking about what else that codon page could be doing or producing. So how does a publisher go about understanding if there's gaps in their commercial opportunity with their partners that they have in place? I think it has to be a matter of going back to those original conversations and revisiting them. Hey, what are your current data practices? Is what's being collected on my page being monetized in any part of your business that we haven't talked about in our last two QBRs. You know, I think that there's a very human aspect to regaining control over these relationships just by raising the topic and having these conversations with your partners.
- [22:35]
Justin Wall
Yeah, really, really good stuff there. All right, so we'll take a break here, a quick ad break, and when we come back, Justin and I will dig in on some of Google's latest platform changes, the anti MFA push of last year and the fallout for publishers and the turning tide on brand safety. Stay with us. We'll be right back.
- [23:10]
Sarah Sluice
Hello, I'm Sarah Sluice, Executive Editor of Ad Exchanger, and I'm here today with Nate Carter, Vice President of Global Sales for iota. Welcome, Nate.
- [23:19]
Unknown Speaker
Thank you, Sarah.
- [23:21]
Sarah Sluice
So everyone is talking about AI. How do you see AI transforming the intersection of data privacy and personalization?
- [23:32]
Unknown Speaker
Yeah, it's helping in several ways. We see AI tools helping our team be more effective and more precise in what we're able to offer up to our clients in terms of audience recommendations and insights. At the same time, we're seeing our clients using AI in order to be much more selective in terms of how they're leveraging audience activation across media channels. They're looking at broader use cases of data and getting to more precise results with their campaigns.
- [24:07]
Sarah Sluice
There's also a continued shift towards a more and more cookieless ecosystem. What approaches is IOTA implementing to ensure marketers can maintain effective targeting through this transition?
- [24:21]
Unknown Speaker
We're working really closely with our partners in order to ensure that our data is transformed into any and every identifier and placed in every ecosystem that our brands need it to be in. This can look at transforming our data against things like ID 5, unified ID. We also have partnerships where we can take offline data sets and use them to map into contextual signal from a customer standpoint. We're seeing more and more where our data which resides offline being transformed and moved into environments like Google, Google Cloud platform, Snowflake Databricks and others where they can start to do offline work before moving it into the digital universe.
- [25:08]
Sarah Sluice
So you brought up your customers, so let's dig a bit deeper into that. How are your clients thinking about delivering meaningful personalization without compromising compliance?
- [25:20]
Unknown Speaker
They need to work with partners who they know are taking compliance as seriously as they are. And that's our job at Dun and Bradstreet and iota. And so we do that. We work in Europe, we know how to be GDPR compliant. We work state by state in the US at the same time, we know that these law changes are going to diminish some of the depth of personal signals that you're going to get on a consumer in any market, and we think that that's a good thing. As we move towards a privacy first market, our customers still need to drive the same results. And so we're seeing them leverage a greater breadth of data, as we discussed, with AI being an enabler of that, while removing anything that could be sensitive both now and in the future. As we move towards a future that is increasingly privacy sensitive, it's important for a healthy ecosystem that we lead the way and we're doing that with our customers in being privacy first.
- [26:17]
Sarah Sluice
Thank you, Nate. Checking those boxes, but also thinking strategically about how to still maintain performance. We appreciate you becoming on the pod and thank you for supporting the podcast.
- [26:28]
Unknown Speaker
Thank you so much, Sarah.
- [26:48]
Justin Wall
All right, and we're back. So Justin, this is a funny story you've told me before. One of Google's past cookie deprecation delays actually came the day before your wedding and it was a big cause for celebration at the time. I'm curious, like, there's no way that like, you know, you were doing anything like, as interesting when the latest delay hit this past summer. And I was wondering, like, do you think that delay was also a cause for celebration or does it feel different this time?
- [27:15]
Anthony Vargas
It feels wildly different this time. I, I wish that the moment was captured forever for the industry of me getting told by my brother in law to be that the cookie deprecation had been punted. And I was just immediately relieved that I could go into the rest of my wedding weekend without worrying about this overarching problem, this imminent doom that was facing us as monetizing entities at a website. I mean, the third party cookie going away was going to mean tremendous revenue drop against our Chrome traffic. And so I looked at that and I said, you know, we're good. I could, I could disappear for the weekend. I could go get married and enjoy myself and not worry that revenue is tanking while I'm doing it. And I think that if I had a spin drift or a beer in my hand, whichever it was, I threw it in the air and I was, I was celebrating for sure.
- [28:13]
Justin Wall
But yeah, like you said, like this time around it feels very different. So like, you know, there's been all kinds of questions about like, what the latest kind of approach that Google is going to take with Chrome, like doing like this, like, you know, like user driven opt in or opt out mechanism. And at the IAB's ALM conference recently, Google seemed to confirm that the new Chrome mechanism for third party cookie tracking would be a one time global prompt rather than like a site by site prompt. Assuming that is the case, like, does that bode well for publishers or what's kind of your reaction to that?
- [28:50]
Anthony Vargas
I don't think that it's ultimately very good for publishers. The universal prompts that we've seen in the past have more so led us towards less tracking than more so. I expect to see the prompt lead people to opting out for Chrome. This means that the privacy sandbox or the tools that came from there that are continuing to be developed, that they'll become more of the resource of value within the browser versus the third party cookie. But to me, this news this time around is really much more of a disappointment. I think that since 2021, you know, publisher, it's been four years of publishers dealing with this constant is it going to happen? Is it not going to happen? And many of the veterans in the industry, folks who've been around the block a few times just said we've seen this movie before and we're not going to ride the ups and downs of the news cycle on this. We're just going to ignore it and just, just see what happens. I don't know. I think that innovation was really harmed by the third party cookie, not just being deprecated at the original planned time. If it was, we would all as an industry have to move towards new solutions, new technologies. And while some might argue that those technologies weren't ready, I would say that the readiness would have come if publishers as a whole and advertisers both were faced with this crutch going away. But ultimately, because the third party cookie was kept around, buyers continued to rely on it. Publishers didn't innovate separately, not at the scale that they should have or could have. And so we're still in the same position today where microme traffic is largely being monetized because of the presence of third party cookies. And there's still not a great alternative for when that prompt comes around and people opt out.
- [30:53]
Justin Wall
Yeah, and it almost feels like quaint to like have like a cookie conversation like you know, at this point in 2025, because it really feels like it's like fallen off like as like the main industry concern since that last Google delay. But it is still such like a existential thing for publishers and really should like still be at the forefront.
- [31:11]
Anthony Vargas
Right.
- [31:11]
Justin Wall
Even though it feels like it's taken a backseat a bit. Right.
- [31:14]
Anthony Vargas
It absolutely should still be at the forefront. The idea of user syncs and cookie syncs and how much data is transmitted between publisher and the bid stream as a result of it, man, there's, there's so much there that has just largely been ignored or overlooked by the supply side as something that's there that might get taken away at some point in the future. But there was so much fatigue around cookie conversation. Like you said, it feels quaint to even be bringing it up now because we've just completely stopped wishing to have headlines and subjects of conversation and webinars around the deprecation of the third party cookie. But in reality the impact that that has on so much of our transaction volume in the programmatic ecosystem, it's wild that we still kind of just treat it as this secondary consideration.
- [32:09]
Justin Wall
And then another major existential concern that derives from Google's business is the importance of search referrals for publishers and publisher traffic. And like you alluded to earlier in the podcast, the rise of generative AI search or the name you use for it, which I really like no click search, I think that really kind of hammers home the threat for publishers. Like it really, it really has been like a, like a topic of conversation, but like something that maybe like the industry isn't realizing just how important it's going to be. But I mean there's been all kinds of speculation about like what impact generative AI search and stuff like Google's like AI overviews and like their search results is going to have on publisher traffic. And you know, it's been largely speculative up to this point, but we do have some data to point to now thanks to research by Seer Interactive. And in a recent study they looked at like, you know, traffic trends basically like when there's like a AI overview present for a search term, when like if there's like a, you know, an organic search result for that term or like a paid search result for that term and what the impact on click through rates is when there's that AI overview. And they found that when there's an AI overview present in the Google search results, click through rate for organic search results fell from 4% to 0.6%. And for paid search results where an AI overview was present, CTR drops from 17% to 6.5%. So like looking at those numbers, you know, how worried should pubs be about this impact of their traffic?
- [33:46]
Anthony Vargas
I'm hearing a loss of 75% or more of your potential click volume is happening. So very, very concerned. I mean at the IB Almighty conference a few weeks ago, it was discussed that only one in three searches are leading to clicks to a web page anymore. And I think that we can look at these stats as an industry. Publishers can certainly look at their search referral volume in their own analytics, but we can also look to our everyday lives as consumers in this ecosystem ourselves to see why this is the case. I mean, I've been a long time original, maybe even I've been a longtime Google Pixel fan. I had the first Droid phone and I've continued to use the Google ecosystem of hardware ever since. And every feature that comes out is about me using my device to more seamlessly access information. And today in 2025, I'm holding a phone that has Gemini 2.0 enabled. It's a AI chatbot that I could speak to conversationally, that gives me answers. And in years before this, we saw the rise of smart home speakers where people just said, hey, whomever it might be, I don't want to set your speaker off in your house right now. But you know, hey, what's the answer to this? Or what's the weather? We've gotten used to simple questions and responses from our search interactions that don't lead us to then do deeper research on it. We take the answer at face value and we move on with our day. And so as chatbots and chat interfaces and generative search all continue to improve far more rapidly than publisher SEO operators are able to keep up with, it's no surprise to me that the answers are given and that people aren't clicking through to read more about it.
- [35:42]
Justin Wall
Do you, do you have like any hope that publishers are going to see any relief from the outcome of Google's search and ad talk, ad tech antitrust trials? Or do you think like that, like any kind of resolution to that is like years down the road and that, you know, these are existential threats that publishers have to deal with before any kind of decisions come down.
- [36:03]
Anthony Vargas
It does seem like the decisions are going to still be delayed and that the resolutions from those decisions will be years out. So I don't, I don't think that there's an immediate task here at hand, certainly not for small publishers. Public publishing and journalism overall is benefiting from the work being done by some large organizations in the legal space to go and have the conversations about IP of the journalism and what was included in training models. But you know, even just a few weeks ago when Deep Seek became a news for, for most and it said that there is a new model out there that's been trained on what all the other models were trained on it it stole from them. You know, if publishers are still trying to say to OpenAI or to Google hey I, I need compensation or recognition for my training inputs to your models, well now that data might be in a different model. So publishers ability to chase this down is going to be seriously hampered. Where I do feel optimistic is in services that are emerging like pro rata AI where they are approaching the space and saying publishers need attribution for their inputs for their contributions to models. And so put simply, the contract that a publisher might sign with pro rata AI is one in which the technology provider is suggesting they will help to assign attribution for your content when it is used in generative AI products and give some type of foundation or structure for publishers to then go and seek compensation for it. So even in this approach there's not some immediate mechanism that's saying we're going to be able to get you paid XYZ because your answer showed up in generative search and then no one clicked through. That's not the case. But at least we're starting a conversation with being able to measure it and being able to claim some number or some percentage of contribution towards an answer. Otherwise without technology like that, publishers are really flat footed here.
- [38:18]
Justin Wall
And then you know, like speaking of all these like kind of traffic concerns that are just sort of percolating out there. You know, one of the, one of the big like, kind of like I guess RE examinations in the industry over the last couple of years has been this big anti MFA push that we saw last year and just, really just this industry coalition around the idea that paid traffic from publishers is something that should be distrusted and that if a publisher is relying on a high degree of paid traffic that they must be involved in some kind of arbitrage and that you know, that's inherently like of lesser value for an advertiser when it comes to like the value of those impressions and the value of that media. But like I'm wondering like have we gotten to a point where now like if you're a publisher and you rely on any kind of paid traffic like you just like you're just like branded with like a red letter by the industry or is there like a way that like the industry can come around to the idea that like it's okay for publishers to pay for traffic in some situations, especially given all the, all the pressures that they're seeing on their organic traffic coming through after the initial.
- [39:31]
Anthony Vargas
Uproar Around MFA made for advertising, made for arbitrage. However, you'd like to define it after the initial uproar around that some publishers in the space, some peers of mine did make some compelling points around the need for publishers to buy traffic as it relates to other business objectives that they may have. In the same way that brands are paying with marketing dollars to get a message in front of an audience, it's quite real that a publisher might wish to sponsor a search result that is more likely to bring click through rate to their newsletter signup page. Or they might want to pay for a sponsored search result that is going to put people into a funnel where they may become paid members, you know, paying subscribers of the publication. So earlier when you're citing the stats from the research firm, it sounded like, if I'm remembering the numbers, you said correctly, that the paid searches did have a higher click through rate than the organic searches, whether there was the AI overview or not.
- [40:41]
Justin Wall
Yeah, it was the drop. There was 17% without the AI without the AI overview, 6.5% with the AI overview, which is still higher than the organic search results without the AI overview, which was 4%.
- [40:55]
Anthony Vargas
Sure. So this is indicative of the potential for a paid or a paid click paid search result. And I see why publishers might want to have traffic coming into some parts of their business if there is ROI to be had against some of these lines of business for them like newsletters or membership sales. Now if the paid traffic was just for the point of arbitraging, which hello listener, that means you're buying traffic in order to back out profitably against the ads that you show to that user, then that is where we see this idea of value dilution. Like the advertiser didn't get what they wanted because the user was bought in for a certain type of content that was shown to them and the advertiser's exposure in that environment was somewhat secondary. The other thing that happened here is that we saw MFA operators getting very good at maximizing the performance indicators that would help the buys come their way. So early gamesmanship around viewability, early gamesmanship around click through rate and engagement rate. But really what these operators were showing us was that there is a degree of sophistication, there is a certain amount of understanding of data and performance that should be in the publisher's playbook. These folks were able to stand up their businesses because they harnessed the data that was available to them and they put it to use. And so while advertiser outcomes and advertiser uproar perhaps eventually moved us away from having that type of operation in the space. Tbd. I don't actually know for sure that it's gone, but it's certainly gone from some channels and some advertisers have been able to move away from it. SSPs have, some have come out and said that they don't support that kind of business or those kinds of partners anymore. So as much as that happened, it also raised the awareness and the sophistication for the general market. And I think as a result, publishers who are not participating in MFA were able to start learning about what some of those metrics were and apply them to their own businesses for organic benefit.
- [43:13]
Justin Wall
And then you know, we've, we've talked like, we pretty much run the gamut of like publisher concerns like in 2025. But like one major thing that we haven't talked about yet has been kind of this like, you know, the stranglehold that third party brand safety solutions have over the programmatic market. And you know, we've seen over the past like couple of years and I imagine it's going to become only more protracted under the new presidential administration in the U.S. but there's just been this major push among Republican politicians and among vocal critics like Elon Musk to crack down on the ad industry's brand safety initiatives. And then we're also seeing just like more interest from like regulators, whether it be from like, you know, some of these like analytics reports, like the, like the one that just recently dropped on ads monetizing child sexual abuse material and like, you know, all kinds of just like findings that they've had about like government and organizations like placing ads on like sanctioned websites and like, you know, like from like countries that like, you know, the, the US doesn't have like good diplomatic relations with and stuff. So there's all kinds of like, reasons for like regulators to place a lot more scrutiny on like these brand safety solutions. And you know, there's talk about like investigations and like all from all kinds of different angles, whether they're politically motivated or not. You know, you can make a case one way or the other. But I'm just curious, like, do you see like, is like the mood shifting around brand safety? Is there a chance that that stranglehold that brand safety has over the programmatic ecosystem could be loosened in some way? And would that be a good thing for publishers? Or is this just like more distraction, more noise?
- [44:51]
Anthony Vargas
It may be naive on my part, but I don't think that brand safety and brand suitability strangleholds on the programmatic ecosystem was politically driven. I think that it ultimately was a lack of sophistication in the technology and a much larger support for the direct advertiser, the direct type of transaction. And programmatic, unfortunately got somewhat left behind and not serviced fully by the brand safety firms, of which there are only a few large ones that are remaining that really have impact here in the space. But what I learned or observed as a publisher was that more often than not, the idea of an absentee buyer existed when somebody was no longer participating in bidding for my inventory at a site level where as an advertiser, whether that's a brand or an agency, somebody who has opted in for the brand safety brand suitability services, and they've taken the signal from that company that certain domains are unsuitable to them. This is wildly frustrating. As a publisher who I'll use salon.com as my example here. We stood up a wonderful food section full of recipes during the lockdown era of the COVID pandemic, when people were home and they were doing nothing but reading online. We gave them excellent recipes, comfort foods, things to go check out in their kitchen as a fully standalone column. And at the time, I remember the decision going back and forth of saying, should we stand this up as its own brand? Should this be its own domain with its own title, or should this be Salon's food section? And ultimately, we believe that our readership and our brand equity and our search traffic was all strong enough that it should live underneath the Salon brand. But what that meant was that an advertiser who used a brand safety or suitability service, who at some point or another blocked us because of the political commentary that happens in our politics section of the website, they never saw the opportunities that we had for them in food and recipes. So the idea that the brand safety brand suitability technology didn't evolve fast enough to support programmatic decisioning at the URL level is really the great harm. I think in this whole space. I don't think so much about the political motivation as much as the technology lagging or lacking in being able to help advertisers make those decisions on a page by page basis.
- [47:32]
Justin Wall
Yeah, really well said. And then this is just like a last kind of question to bounce off of you. But whenever I kind of have these discussions with publisher side sources about just like all these challenges that face publishers when it comes to monetization, a recurring thing that comes up is just like, you know, the need for publishers to have a more like collective approach to like really throwing their weight around the industry and like demanding fairer treatment and like, you know, fair compensation from their partners and you know, like more equitable kind of like approaches to how all of this stuff is designed in the first place. But like, you know, it's almost kind of treated as if that's like a pipe dream that like, you know, there will never really be collective action, especially amongst like competing publications and like all these different things. What do you think? Like, why, why do you think the calls for collective action among publishers never really go anywhere? And is there a way to change that going forward?
- [48:25]
Anthony Vargas
I'm not sure that the calls for action ever come with changes in behavior that support them. Right. The publishing community is a recipient of dollars from the buy side. And so very often when it comes to what standards are, what information should be passed in a bid request, I mean, these questions all come back to, well, what are the buyers actioning on? Where is the dollar coming from? And many publishers, many of my peers, have been of the mindset that they will react to the money. And if the buyers send a signal to the supply side that they're only going to transact on certain things or that they have new standards, that's, that's where the publishing community moves. So when the publishers get together, despite competition between them, despite complexity of the business, and they say we need a coalition, we need to come together and say that this is the new norm or this is the new standard, this is what we need as an industry, they also are faced with a revenue risk because until the buy side says yes and starts to buy or spend in the way that the publishers are suggesting, they can't afford to change until the money changes or the money is available for them on the other side of that change.
- [49:47]
Justin Wall
Yep. So as with everything, money talks, right?
- [49:51]
Anthony Vargas
Money talks. And publishing is unfortunately a low margin business. There is a very real overhead of paying all the journalists in the newsroom and of making sure that you've got enough money for all your benefits and any rent expense that might still exist. And at that point, you know, when you've got jobs and tight margins, there is no real chance to say, I might risk 25% of my programmatic revenues because I believe that there's this big change that has to happen. That's a huge bet. And so I think that the risk of that bet is why we have seen this sluggishness on publisher coalitions going anywhere. Now, I have to say, while I'm talking about bets and opportunity costs, really, this is the time of year to make those types of bets. As a publisher, I'm speaking to you today in February and that means we are mid Q1. It means that we are experiencing some of the lowest CPMs and lowest RPMs, lowest yield of the year. And so if a publisher were seeking to make a change and they were worried about 20% or 25% of their revenue taking a hit in the short term until those changes might take effect, this is the best time of year to do it because you're Talking about losing 20, 25% of a low month, making some critical infrastructure changes or demand. You know, connection changes in Q4 might have been too much of a revenue risk for publishers, but this really is a great time of year to consider making those changes in a safer way for your organization.
- [51:31]
Justin Wall
Yep, gotta, gotta be smart about making those big bets. All right. Really great, really great conversation. Totally appreciate the insights here. Justin, this has been great. Thanks so much for joining the podcast.
- [51:41]
Anthony Vargas
Absolutely. Thank you for having me. And it was really nice to speak long form this way and get to develop some of the thoughts in the podcast format. So thanks for having me here today for sure.
- [51:51]
Justin Wall
Thanks everybody for joining us. Take care.
- [52:02]
Sarah Sluice
Today's episode was brought to you by iota, a Dun and Bradstreet company and trusted global provider of audience solutions for digital marketing. IOTA is your partner for quality certified audience data and transformative digital marketing solutions. With comprehensive consumer data capabilities, IOTA delivers the confidence and tools marketers need to Thrive. Discover how IOTA can make growth easy@iota.com that's E of B dot com.