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Episode 135: Scott Howe from LiveRamp and The Trade Desk’s very bad week
00:54:49
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- [00:01]
Ari Paparo
This podcast is brought to you by Incremental. You ever run a holdout test, wait between two and five weeks for the results and then realize you just wasted a big chunk of budget? By the time the data comes in, the campaign's over, the money's gone, and the insight's basically a post mortem. That's why I like what incrementl is doing. They give you always on incrementality measurement. No experiments, no holdouts, no delays. You get answers while the campaign is live and so you can actually make changes, not just analyze the wreckage. With Incremental, you don't just learn what worked, you do something about it. Check them out at the Future of Measurement. This episode is brought to you by Sovereign, a software and data company powering commerce media campaigns for the world's largest brands. With real time purchase intent data collected from over $3 billion in annual retail spend. Sovereign's commerce media deals are helping reach consumers at the time of purchase and deliver better outcomes for advertisers. To learn more, visit sovereign.com that's s o v r n.com to learn. Welcome to the Market Share podcast. This is Ari Paparo and our special guest today is Scott Howe, the CEO of LiveRamp. He is a fun guy to talk to, a lot of energy, a lot of vision and excitement around the company. Eric Franchi joining me as always. Do you know Scott pretty well?
- [01:35]
Eric Franchi
I don't know Scott pretty well. I've met him a couple times over the years. I'm excited to hear what's going on with Liveramp, what the state of data collaboration is. I've seen him speak and he's a really like, he's a very positive guy.
- [01:49]
Ari Paparo
He is.
- [01:50]
Eric Franchi
And I'm looking forward to just getting some good vibes from him and diving into the news of the week. And there's a lot, a lot of news. Yeah, we've got ttd, we've got monster streaming deals, we've got some Holdco rumors, some AI. It's going to be a fun episode.
- [02:05]
Ari Paparo
All right, let's just dive right in. Just a quick reminder, there's only two weeks left to get your early bird tickets for marketecture Live. It's marketecture Live was sold out in the spring. It's coming back to New York October 27th. We have a stacked agenda and we're talking about outcomes. So I would strongly recommend taking out your corporate card and buying a ticket before we sell out again. And the ticket price goes up right around Labor Day, so do it before summer's over. All right, let's jump in with Scott Howe, the CEO of LiveRamp. And we're here with Scott Howe, the CEO of Liveramp. Scott, thank you so much for joining us.
- [02:41]
Scott Howe
Ari, always a pleasure. I'm glad to finally have made the cut for your program.
- [02:45]
Ari Paparo
Oh, you were welcome anytime. We've had a number of Liveramp people on this, on this pod or on the vendor interview pod. So now we would get the boss level.
- [02:56]
Scott Howe
Hey, I'm a regular listener and I've always wondered, like, what do I have to do to actually get on the podcast myself? And the answer, apparently was just wait long enough when you ran out of other interesting guests, I finally got my place on the queue.
- [03:11]
Ari Paparo
Yeah. The tip to PR people out there who are listening, there's two tips. Number one is just ask. Number two is summer, August good time. You want to get your clients on, Call us the second week of August.
- [03:22]
Scott Howe
All right, so speaking of, just ask, I'm taking over this interview. Here's the question I'm going to ask you, Ari, because normally you ask your guest questions, but I am really excited about a new book that's coming out. You may have heard of it. It's called How Google Bought, Built and Bullied Its Way to Advertising Dominance. And I'm just wondering, if I were to say, no, the writer of that book. Can I get myself an autographed copy?
- [03:51]
Ari Paparo
Yes, you can get an autographed copy. You can't get a free copy though, because I gotta make some living here. But I will be happy to sign your copy. I mean, my house. If this was a video podcast, you'd see I'm basically surrounded by them and immune to any sort of disaster because I' enough insulation from extra copies of the book. But the book is out August 5th. It came out. It's number one in certain weird categories on Amazon. I'm hoping it'll be number one on more of those categories over time. Have you read it yet, Scott?
- [04:21]
Scott Howe
I haven't, but I gotta tell you, I'm super intrigued. And I got a really long plane flight tomorrow. I'm flying to Madison, Wisconsin. I'm going to go visit my dad. And so this is lined up. I desperate to read it and in part because, I mean, I lived it. Right. I was right there. And I know all of the people that you interviewed. And so it's going to be a trip down memory lane.
- [04:47]
Eric Franchi
Yeah.
- [04:48]
Ari Paparo
You have like an all star cast on your board, right? Like Brian o' Kelly's on your board.
- [04:52]
Scott Howe
Who else is on Your board, Tim Curragan.
- [04:55]
Ari Paparo
All right. Yeah.
- [04:56]
Scott Howe
Yeah.
- [04:57]
Ari Paparo
So, yeah. So Tim was at the trial, very interesting testimony, because he talked about how he had to lay off people because of Google's algorithm changes, and I thought that was pretty impactful. And now he runs GoFundMe, which is helping me raise money to buy ADEX. I'm up to, I think, for those of you who don't know the joke, I've got a GoFundMe to help me buy ADX from the spin out. And I think we've raised $160 as of this morning. So I have to thank Tim for that because he's the CEO of GoFundMe. Okay. We should talk about Liveramp. Maybe.
- [05:27]
Scott Howe
We'll go wherever you want.
- [05:29]
Ari Paparo
All right. What. What is live ramp nowadays? Like, I mean, onboarding, data, clean rooms, data broker. Like, what. What is the company?
- [05:37]
Scott Howe
Yeah, I mean, we've really evolved. The Liveramp that everybody first encountered years ago, back when Axiom bought Liveramp was a data onboarding company. It helped companies who had data distribute that data to the destinations that mattered. That business has really evolved. And I don't think onboarding, quite frankly, is all that useful anymore to us. It's not like a monologue. It's a dialogue. It's a conversation. And so data onboarding is really giving way to what I would call data collaboration. It's about connecting data across partners. It's about creating a network effect such that companies can assemble with their partners the right set of data to deliver the best experiences to users. And even that is evolving because the data collaboration that we've been doing for the last few years is really giving way to AI enablement. You know, I told our board, we just. Just had a board meeting. I said, hey, if a decade ago we were a data onboarding company, today we're an AI onboarding company and an AI collaboration company. And I think this is a big deal. I know you've talked about it a lot, but AI is eating the industry. And there is, you know, anytime you can get better decisions, more efficiency, everyone's got to pursue that. But what's missing in all this is it is really hard. And the complexity that was true in data collaboration, AI puts it on steroids. If I'm an average marketer, there might be hundreds of specialty AI agents or even thousands that I want to utilize. But to utilize those, the things that are important to me in data collaboration, in clean rooms, about control and visibility, about how the data is utilized, all those things become so much more Magnified in an AI world like today, that set of standards hasn't been built. I'm getting way beyond your question because I've already answered what Liveramp is. But I'll tell you where we're going next, and that is we don't believe that we ought to own the standards for the industry, but we'll definitely have a voice in them. And we think that our industry needs kind of a, an even deeper version of mcp, you know, protocols that allow companies who have large data sets to communicate with one another. We call that internally UCP, our user context protocol. So how can different companies engage with one another programmatically to access the core data ingredients, which is the data, but also the underlying permissions, the identity keys, the. The context of the use cases. And so we're spinning up right now a whole host of town halls. We are inviting everyone in the industry to participate, to weigh in on what those standards should look like for how we can work together. Because I know one thing which is if someone doesn't do this in a really open way, it's going to happen in a nefarious way and for 20 years. I mean, this, I think, is going to be one of the punchlines of your book. The owners of data on either side, whether it be the companies that built loyalty programs or the publishers that had deep viewing information, they did not reap the benefits of that data. Instead, it all flowed to the black boxes in the middle. Who disintermediated the ends where the value was actually created.
- [09:44]
Ari Paparo
Okay, so I get all that. So AI powers a much more complicated relationship between the parties. There's a lot to go through I want to talk about. Let's do AI first. I was going to do it later, but since you teed it up. So one of my big questions about consumer data and AI is how much there is to really work with. If you have, I think about a typical DSP setup and I have a segment that's like high intention car buyers from pulk. Like, what does the AI have to grab onto there to use, its ability to predict and do stuff? Because I could go back to my performance logs and say it performs better, we should use it more. Fine. That doesn't require AI. So is it suggesting what data to use or is it something deeper than that?
- [10:31]
Scott Howe
Oh, Ari, this is the slowest of softballs you've ever served up to any guest. Because you know the answer to this, right? Which is right now, the LLMs are trained on publicly available information, and that publicly available information hits an asymptote in utility. Pretty quickly the most valuable information in the world sits behind the firewalls of all the major marketers and all the major publishers. And you know, let's just think about kind of the pre, kind of Chrome deprecation announcement to today. Six years ago very few companies actually collected user data and had large CRM programs. Now just think about the number of loyalty programs that you've joined in the last five years. If you're like me or anyone, it's probably overwhelming, right? And you join the companies that you have an affinity for, you share information, you allow them to collect things on you because they give you a better user experience. Likewise, if you look, you probably know the stats five or six years ago only a fraction of the CUB score 50 actually did true authentication. Now it is a perfect 50 for 50 because again they can collect information and deliver a better experience to that user. And then the combination of the proprietary data when it's combined across multiple parties with their permission, that unlocks the magic, right? And so you know, want to unlock the power of AI, feed it those proprietary data sets. But to feed it the proprietary data sets, no one, but no one should give an AI model access to federate their data or the ability to do anything they want with the data. No, the data should be used for you and your partners and your purposes and only, right? So having that set of controls is so important.
- [12:38]
Ari Paparo
So this is like Marriott knows I'm staying at their hotel and Starbucks knows I like iced Americanos and the AI tells me where the nearest Starbucks is. And then when it opens, that sort.
- [12:49]
Scott Howe
Of thing possibly, I mean you can take it in all kinds of different directions. And the common denominator is, you know, companies should only do this when it generates more value for consumers.
- [13:01]
Ari Paparo
Okay, so you talked about, it's not data onboarding, it's collaboration. That sounds a lot like the pitch from Habu before you acquired them. So it's been, has it been two years or a year and a half since Habu was acquired? Does it exist? Is clean room still a category? Because like Habu and Infosum I thought of as the two leaders and they both got exited. Is it something customers ask for or do they just want to share data in a privacy protected way and they don't necessarily, you know, need that piece of the architecture to make it work?
- [13:31]
Scott Howe
Well, it's now we've integrated Habu into Liveramp's core platform and so it is just a really important feature that all of our clients receive and increasingly Utilize because they recognize in a world where Amazon collects so much data about people, it's really hard to out Amazon Amazon unless you actually start to collaborate with other partners. And so, you know, your Starbucks Marriott example, for instance, or even, you know, when you start to pool up multiple parties. We released a case study, I think it was about a year ago now, and it was, I believe it was Albertsons, maybe it was Pinterest and it was Triscuit Crackers. And each one of those partners had proprietary information that the others lacked. And so when they join and have control over how their data is utilized, well, Triskit knows through Albertsons who actually bought crackers. Pinterest can provide the global reach to reach cracker users. And Triskit is going to fund the campaigns. You know, in that case, like, I love Triscuit crackers, but it's not like, it's not something you would typically think about having a 20% lift. They got a 20% lift just under when they started to collaborate. And that's pretty significant.
- [15:04]
Ari Paparo
No matter how long I'm in this industry, when someone uses a phrase like cracker users or cracker intenders, it's gonna make me laugh. There's just no way around it. It's gonna make me laugh. I am definitely a cracker user too. So, okay, so collaboration.
- [15:20]
Scott Howe
This may explain, by the way, why I haven't actually gotten an invite in years to this podcast.
- [15:27]
Ari Paparo
Well, you could tell your grandchildren you were on it once. Okay. So I'd be remiss if I didn't bring up Chrome in the sandbox for those of you who've just black holed the whole thing because it disappeared for four years, we were under this cloud of the sandbox and Chrome cookies going away. And then like it was all a dream, it went away. And I think your company was under that cloud to a great extent where people were saying, well, you know, they have to make this transition somehow or it's going to be a problem. How, how did you like, bat those criticisms off? And how are you feeling now that the cloud is moved on?
- [16:10]
Scott Howe
I'm not sure. We did bat those criticisms off. I'll tell you, someone gave me analysis telling Sean Downey from Google this that someone gave me an analysis once that said, hey, the secret to Liverams valuation is whenever Google makes an announcement on cookies, something crazy happens to you.
- [16:29]
Ari Paparo
Yeah.
- [16:30]
Scott Howe
And it was so frustrating because when they announced that they were going to deprecate cookies, everyone said, geez, this is terrible for Liveramp. What does it mean? I said, it doesn't mean anything. We're going to be fine. And then when they announced that they weren't going to deprecate cookies, everyone said, geez, you worked so hard on ats, what does it mean for you? It is, we're going to be fine. But you know, the crazy thing is in that five year interval, regardless of whether any company is, has said that cookies are going away or not going away, cookies have kind of gone away. So many of the integrations that we're doing for partners don't rely on cookies anymore. They're actually direct authenticated integrations. And I want to say in Q1 of this year, we hit a milestone at Liveramp where the actual reach on direct authentication was greater than the reach that you could generate through cookies. And so if anybody's still thinking like cookies are a big deal, you know, if all you're doing is advertising and cookies, programmatically, you're probably reaching less than 50% of the available reach because you're not reaching Safari users, you're not reaching Edge users, you're not reaching Firefox users. And what marketer should ever be satisfied with launching a campaign to only 15% of their target market?
- [18:01]
Ari Paparo
Always. That's always the argument. And to follow on, on that one topic we were talking about before we started recording was the general. This week's been a pretty bad week for stocks in the ad tech sector. And I think our friends at U. Of Digital wrote a really depressing weekly newsletter about how Open Web's dead and all the open web stocks are dead. And obviously we don't want to talk about your stock here or your financial performance at all. But I would like to hear whether you consider Liveramp part of the open Web or not.
- [18:33]
Scott Howe
I think we're a catalyst for the open Web, but I would say that more broadly, we're a catalyst for data utilization and delivering great customer experiences. And you know, that's the piece that's not going away. We live in a signal future that AI is going to be powered. The winners will have access to the most valuable signals. You know, no one company not named Amazon could collect all the most valuable signals. You have to work with other companies to generate that. And that's where we enter. And so, you know, whether someone's advertising programmatically, whether they're doing a direct deal with Netflix, whether they're trying to power a different user experience at point of sale, we enable that. And so, you know, historically, over the last 10 years, I could tell you who the winners and losers were going to be because I can see it by the data collaboration volume, right? So I could see like when a certain social media platform lost share to another social media platform long before the world noticed. And you know what I see though is that the number of collaborations keeps going up, up, up. And I, I predict that's going to skyrocket as more and more companies turn on AI.
- [20:02]
Ari Paparo
So it seems like the sweet spot to some extent is like these hedged gardens, like these companies that have a proprietary product and audience but that are not the very, very biggest, like the, you don't have to name customers. But you mentioned Pinterest earlier and you know Spotify is adopted, I believe your ID recently. Is that a good way to think about things?
- [20:25]
Scott Howe
Well, I think they have something really valuable to communicate. And if you start with the premise of the value is in the signals, then you ask yourself who has valuable signals that are unique. And so when I look at the CTV players, they have such deep viewership information and important context in and of itself. Maybe it's not a full solution, but when you take what Netflix has and then perhaps combine it with what say a General Motors has around car buying intent and on the purchase journey, then you have something really magical. And so in some respects I wouldn't say that my bets on the walled gardens or the hedged gardens. My bet is on companies that have valuable, unique, consumer permissioned information. They will be the winners and those that don't and cannot collaborate to gain that will be the losers. And I think what's happened is we've had 20 years of disintermediation. I think we are entering a period of democratization where the playing field is level again or starting to become more level. And then the question is, how will we as an industry respond? This gets back to what I was saying earlier. You know, if the response for those important publishers is to seed all their data to a black box, then we're going to see the same thing happen over and over again. If the response is instead for them to say, hey, I have valuable data, I want to make sure I maintain control over it. I want to make sure that I get a fair, valued exchange for it, that I think those companies will emerge.
- [22:19]
Ari Paparo
As real winners, that makes a lot of sense. I think that's probably a good place to take a quick break. We have a lot of news this week and it's very related to this around the trade desk. And the Walmart news just came out today, so we'll come back in just a moment. With our refresh news of the week and we'll kind of basically continue this conversation in that context. This episode is brought to you by U of Digital, the Go to training company in adtech. They've launched the AI Accelerator, a hands on boot camp that gets teams actually using AI for marketing and advertising use cases. Most people in our industry still aren't confidently using AI even for basics like better email or smarter research, let alone creating content or analyzing data. The AI Accelerator changes that. It's participatory, immersive and it's being used by teams at Diageo, Disney and Media Ocean with tremendous results. And industry AI leader scope 3 is now the exclusive sponsor of the AI accelerator. This program is legit. Go to UofDigital AI and use promo code market for 20% off or email contact of Digital for group rates.
- [23:36]
Eric Franchi
We're back everybody. With the refresh on the docket this week we got to talk about ttd. They posted earnings after our episode last week, so we'll certainly talk about that. We'll talk about the news that just dropped before this pod about the Walmart exclusivity deal no longer being exclusive. We've got some rumors in holdco land around S4. We've got a huge streaming deal, second one in two weeks. And as always, fun stuff in AI land. We gotta start with TTD, guys. So last week TTD reported earnings, stock got hit very significantly. It was down something like 35, 39%. Revenue was up 19%. So they were pacing or outpacing the market. But there was some concerns around how Jeff Green and management addressed the Amazon threat when questioned by analysts specifically not addressing it as a threat, addressing it as an opportunity and a potential partnership. And most of the analysts and a lot of observers saw that pretty critically. Where do we begin on ttd?
- [24:45]
Ari Paparo
Well, you missed the big news, which is that Jeff Green on X said that that he would like to be on this program as a future guest. That's the real news this week.
- [24:55]
Eric Franchi
I did see that. That's big. I don't want to get my hopes up because I read into it and he said he voted yes, but didn't actually agree to yes, but maybe you have some information I don't have.
- [25:09]
Ari Paparo
We don't have a schedule yet, but our people are talking to his people. So I guess we have to say nice things about him now.
- [25:16]
Scott Howe
Ari, I'm just curious. If Jeff Green asked for a copy of your book, would you give it to him or would you make him pay too?
- [25:23]
Ari Paparo
Well, the thing is, I did ask him for comment on some issues around his old startup AD ecn, which got acquired by Microsoft in the early days and he didn't respond. So I don't think he gets a free book.
- [25:36]
Scott Howe
All right, so to that point I will tell you that Jeff and I work together at Microsoft. So I remember ADCN very well. I know Jeff very well. I have worked with him closely years ago. I've worked with him as a partner over the last 15 years. And I would just tell you, the short term market dynamics aside, I wouldn't bet against Jeff Green. The one thing that he has always done with Trade Desk is he has made things drop dead simple. He's made things easy to buy. And if you think about how he emerged from the chaos of the early DSP space by focusing on agencies, by making things so easy, by having such great service. Great response at this. I think he's going to do that again and if he follows that formula, he's going to be successful. Because what's the one thing that we all complain about in this space? It's that things are too complicated. So I just would never bet against Jeff Green.
- [26:44]
Ari Paparo
Fair. I think the founder advantage is real. If the company needs a shakeup, which I don't know if it does, if it does, he's the right person to do it.
- [26:53]
Eric Franchi
Critics would say that of course, yes, it's a great platform and a great founder and all of the great things, great customers. But they're being aggressively pursued by Amazon who is reportedly undercutting them on pricing. And Amazon is extremely focused on driving outcomes. And a lot of the conversation on the earnings call and more broadly has been about open versus closed and you know, the open Internet and saving the open Internet versus being mania focused on driving outcomes. And I think that's the piece where TTD has an opportunity to really shift things and show how, you know, they can help drive outcomes and be at, you know, if not, if not parity, be a competitor to Amazon and others from a performance standpoint. What do you guys think?
- [27:41]
Ari Paparo
I think it makes sense. The open web doesn't have a platform that is known for, you know, drop dead performance the way sort of applovin is carved out in, in the app world. And it's quite valuable if you can, if you can deliver that. It is however the case that they are fighting with one arm tied behind their back because Amazon has its data and we'll talk about Walmart in a moment. Yeah, Inventory and data are the two ways you differentiate a DSP and you know, the Trade Desk knows this. They're not, they're very smart people and what they've done is a lot of, you know, clever tactics to gain their own data and inventory. But S&P 500+ is a way of getting inventory open pass, a way of getting inventory. None of it's exclusive, though it's like slightly better than competitors. Whereas you're on Amazon, you have exclusive rights to their data and exclusive rights to Fire tv. Hard to compete with that in the long term. And I think that it may be time to be a little more break the glass, I would say if you're looking at the tactics available to them.
- [28:45]
Scott Howe
Well, I, I think there was another announcement that Trade Desk made in the last week that is actually pretty significant and you referenced it earlier, Ari, which is adding Omar to their board. And what I think is really interesting about that and combined with the make things easy comment is where is there a lot more money to unlock? Well, it's in ctv. But how do you unlock CTV budgets? You make CTV and those ad units available to everyone, not just the hundred biggest television ad spenders. The way you do that is through AI Automation of Creative. And who has been the smartest person in the world over the last two years at Rembrandt in terms of AI insertion into streaming? It's Omar. And so if you don't think that that's not an angle there, I'd be stunned because that combination makes too much sense.
- [29:54]
Ari Paparo
Like they say on the wire, omar coming.
- [30:00]
Eric Franchi
We should note that Omar Talkal is board director of liverap. He is founder CEO of Rembrandt, which is a portfolio company of Apparim where I work. And I violently agree with you, by the way, Scott. I think that was a big move. There's no one smarter about AI generally. And I spend a ton of time in this space and certainly as it relates to creative and ctv. So I think that's a great call out.
- [30:25]
Ari Paparo
I would double down on my point, which is I think if I was Jeff, which I'm not, I would be thinking about what are the chess pieces available to regain, Especially with the Walmart news. We're about to talk about some bit of very valuable data or inventory and make it mine. Make myself a must buy. And I could suggest there's really only two pieces on the table. There's only two things I could think of on the table. One is the Yahoo dsp. The Yahoo DSP is a number four player. It's really good product, People like it and it's got access to Yahoo Identity search data and email data and it's very valuable and you could probably get it for a fraction of the Trade Desk's Market cap. And two would be Critio, which isn't proprietary but it's organized in ways that are very proprietary. It's like open data, but it's very well curated data, especially with all the retail aspects.
- [31:25]
Eric Franchi
It's funny, I. I thought you were going to say something you have said previously, but I guess just given Market cap it's no longer realistic, which is by Roku.
- [31:34]
Ari Paparo
I never really thought that was possible. I. It was, it'd be great. But I thought maybe I did say it on a previous episode but I'm not very consistent. That's a. It's a big bite.
- [31:43]
Eric Franchi
It is. All right, let's talk about Walmart. So right before we went on there was news that broke that apparently TTD is losing the exclusivity in their deal with Walmart. Ari, how important is this? Seems like a big deal.
- [31:58]
Ari Paparo
It's very big deal. Once again, Kathryn Perloff from the information who last time we misattributed her the information. Yeah. So Walmart's like the anchor tenant in the Trade Desk's overall commerce strategy as well as their overall proprietary data strategy. My understanding is that you not only use it for retargeting the Trade Desk for retargeting, but also you could use the Walmart data for attribution and conversions even if it was on other media. And so that's a really big deal. And it's like they didn't own it but they had a long term agreement. So non exclusive opens the door to lots of things. Like Walmart could start using a different party. You assume they're not going to use Amazon, you probably assume they're not going to use Google. So that puts Yahoo or someone else as a potential alternative vendor. Also worth noting that in the article they blame price as an issue. I mean Walmart's known for everyday low pricing for focus on price and Trade Desk is known for being expensive and that's not the best combo. So this could either be a very small deal or a very big deal because we haven't seen the other shoe drop yet.
- [33:09]
Eric Franchi
What could the other shoe drop be? Who else gets access to the inventory?
- [33:13]
Ari Paparo
Yeah, Walmart could do a parallel deal with someone like a Yahoo and allow Yahoo to compete with them on an even basis for commerce companies, maybe a lower price. And in the long term Walmart that now owns Vizios as a major stake in the CTV world could be looking at a build buy option to compete head to head with Amazon.
- [33:36]
Eric Franchi
Makes sense. Scott, any thoughts on this?
- [33:38]
Scott Howe
I think you guys think it's a bigger deal than I do. I think we're entering a world of democratization and collaboration. The world is open and those that try to, you know, wrap things up in exclusives that, that that world is kind of the last decade and so Jeff's going to win and generate more volume by delivering a better yield, period. And if you can do that then Walmart and others are going to steer towards him and if he can't then, then they won't. But again, I'll repeat what I said before. Never bet against Jeff Green. He's is smart, he'll figure it out. And my guess is when he talked about this he didn't sound panicked. He's probably known about it for a while and I'm sure they are preparing for an open world where they're going to have a lot more partners.
- [34:34]
Eric Franchi
Yeah, the commentary from TTD they provided I think like one comment. It was not panicked, obviously it was.
- [34:41]
Ari Paparo
By the PR department and it's a.
- [34:43]
Eric Franchi
Really interesting point, Scott. I can't think of another big exclusive media and data deal besides this, either of you guys.
- [34:53]
Ari Paparo
There are exclusive data deals where licensing of data, there have been a lot of them in the CTV space because there's a relative sport scarcity of the data. But I don't know of an exclusive media deal.
- [35:04]
Scott Howe
If you just think back to when that was signed, it was a different period. So it was very odd in the retail media network growth and here we are what five, six years later and everybody has a retail media network and it's really expanded from retail to commerce. And so as it's become mainstream and collaboration has become more accepted and really embraced, I just don't think those proprietary kind of deals mean anything anymore.
- [35:35]
Eric Franchi
Yeah, that's awesome perspective. Glad we have you on this week. Let's move on. So S4 Martin Sorell, sir Martin Sorrell's Holdco is engaged in acquisition discussions with a company called MSQ which is a, a PE backed agency which frankly wasn't on my radar. S4 as listeners may or may not know, has been hammered in the public market. It's down 98% from its peak and is currently valued at 140 million pounds, probably 170 something million US dollars and has thousands of employees across their various operating entities. So they need to do something. Acquisition is obviously one route to get there. Strangely enough. I think S4 confirmed that the discussions were happening and MSQ denied that the discussions are happening. So I don't know what's going on there. And it's probably out of the. Out of the corporate M and A playbook to have this type of repartee. But what do you think we need.
- [36:41]
Ari Paparo
To have Brian Weiser on again? He's the only one who understands any of this.
- [36:44]
Eric Franchi
The Whisperer.
- [36:46]
Ari Paparo
All I'll say is that I think that the growth of tech and AI could have sort of interesting effects on a lot of these. Holt goes where winners and losers become more stark. I think we talked about that with Brian last week. But also potentially those who are doing well could have more leverage to do acquisitions or to buy up the smaller guys. So it's. This is like an interesting little story, but until something happens, I don't know what to say about it.
- [37:15]
Eric Franchi
How big of a customer base are the hold codes to Liveramp? Scott, to the extent that you can disclose this kind of stuff?
- [37:22]
Scott Howe
Oh, yeah. We work with every single holding company. And obviously part of Liveramp's legacy is now owned by ipg because you'll remember we sold the Axiom service business to ipg. So great relationships with all of them. You know, I'm certainly. I'm an ex agency guy myself because years ago I helped get Avenue Razorfish off the ground. So it's always really interesting to see what they're doing. I will tell you right now, I think the agencies. The sector is getting killed, but that pressure that they're probably feeling is leading to some pretty rapid innovation. And I look at like publicis and what they're doing with core AI. They're fantastic. They're reimagining how agencies do the work. And I would imagine unlocking far better performance for their clients. I don't know if you guys went to the MMA annual meeting. It was a few weeks ago, but it was amazing. They shared some of the early case studies on AI. AI Driven targeting. AI generated creative. The average lift it's on their website was, I want to say 190% across the clients. And the clients included folks like AT&T and General Motors. And they talked about one of the case studies they showed was the average creative production time went from 10 weeks to film a commercial down to 36 minutes. And the actual video feeds were indistinguishable. So it's just so interesting what's going on in the agency world. It's a lot of fun to be live rep right now working with Those agencies and seeing them all innovate in.
- [39:22]
Eric Franchi
Slightly different ways, that's a crazy stat. 10 weeks to. What was it? 37 minutes?
- [39:28]
Scott Howe
36 minutes.
- [39:29]
Eric Franchi
Oh, my God. God, I gotta say, this thing. That's incredible. All right, let's talk streaming. So there was a big announcement last week. ESPN with WWBE and NFL. And then this week, Paramount plus, now under new ownership, had their own big announcement. So Paramount is going to take over Paramount plus rather is going to take over streaming of usc, which previously was mostly pay per view and also with a ESPN deal with the ESPN app. This is. This is a big deal. So, number one, $7.7 billion over seven years. And then I think, number two, it signals, frankly, I think the end of the pay per view era, because UFC was basically the last of, you know, the real draws for pay per view. And the numbers were not good over the course of the past couple of years. So this is. All right. I'm a fight fan. Just give me a moment. This is so good for fans. The cost of watching all UFC events is going to go from $1,100 this year to $120 next year, and we'll open up an entirely new audience. It's going to be awesome for, obviously, advertisers. I think this is, like, so good. I probably lost all the listeners.
- [40:50]
Ari Paparo
No, no, no. Our listeners like to see people beaten up. So. But, e. So before this deal, were you a Paramount plus subscriber?
- [40:58]
Eric Franchi
I was, yeah.
- [40:59]
Ari Paparo
Oh, why? What. What shows? Yeah, what shows you like? Paramount Plus. Yeah, I forget.
- [41:04]
Eric Franchi
There was one or two shows. Oh, wait, the one with Tom Hardy, the Moblet. That was Paramount Plus. Okay.
- [41:11]
Ari Paparo
Okay.
- [41:11]
Eric Franchi
Worth it for Mobland, by the way.
- [41:13]
Ari Paparo
Okay.
- [41:13]
Eric Franchi
But their. Their catalog of 80s and 90s hits is so good.
- [41:19]
Ari Paparo
Yeah.
- [41:19]
Eric Franchi
So good.
- [41:20]
Ari Paparo
They've started great. But this is going to keep you or make you a happier customer. Not churning, basically.
- [41:27]
Eric Franchi
Yeah, it's incredible. This is so good. And it's, I think, just signals that the future of what you were talking about, Ari, which is like, you need to secure really big opportunities for users as a streamer, is like, it's so here.
- [41:42]
Ari Paparo
It seems like a big deal because prior to the acquisition by the Ellisons, yeah, they were really very much an afterthought, like a very optional streaming service. No must haves, really, except, like Yellowstone and the related properties. And this makes a big deal. And it also feels as though they're sort of positioning themselves as not. And I don't mean this a pejorative way, but a Little bit of a red state kind of feel because the Yellowstone products also very much go to that audience. CBS has always been the more conservative programming network and UFC also is in that vein. Not, not. I don't mean this in a bad way at all. They're just trying to different differentiate themselves from like a Disney, which maybe has a family sort of approach.
- [42:26]
Eric Franchi
Yeah. And God is TKO is the, is the owner of UFC and wwe. They are making great deals. I think UFC revenue is something like $900 million last year and then just with this deal it's north of a billion dollars next year. So just like by changing the model, they're going to make more money. So very interesting to be a sports and rights owner right now. Scott, you a fight fan?
- [42:52]
Scott Howe
I am. And so listen, I also am a Paramount subscriber. I think I have every streaming service. So I'm excited about this. What I would tell you is it validates what we all know. Content is king. It's super valuable. My self interested spin on this though would be content gives you context and that's valuable. But in and of itself in the world we're going context plus other signals is going to yield the best outcome for advertisers. And so, you know, when I think about the different CTV providers that we work with, the ones that I think are doing the most interesting things, it goes back to the collaboration and there's a willingness amongst them to actually lean in to their advertiser partners and share data. The combination of the content viewership, the signals that the publisher is grabbing with, the signals that an advertiser can bring. When those two are combined, the magic can happen. The yields go up for the programmer and the ROI grows exponentially for the advertiser. And so I think the way you pay for more of these kinds of deals is you make your advertising more valuable. So we're going to see this as a catalyst to do more interesting things, the likes of which we've been talking about for the entire podcast.
- [44:33]
Eric Franchi
Could not agree more. The data and the ad innovation is going to be so cool. All right, let's talk AI. We have to two things this week. So first, Perplexity submits an unsolicited bid to buy Chrome for something like $34 billion, about 2x their valuation. This is great. I think it's just like great marketing. No way they can pull this off. But I love to see it whatever.
- [44:59]
Ari Paparo
Because yeah, it's a PR stunt because among other things like the it's not up to Google to sell Chrome it's up to the judge and the committee that the judge appoints to determine who the highest bidder is. So jumping the gun doesn't help at all here except to just get in the press.
- [45:16]
Scott Howe
I just want you guys to know, cutting breaking edge news. Liveramp is also launching a bid to buy Chrome. You heard it here first. You know, we probably can't pay as much, but we're really nice people and we're, we're innovators. So, yeah, Sean Downey, come home to Live Ramp.
- [45:35]
Ari Paparo
I don't think Sean's going with the. Sean is not going to get spun out. He's too smart to get spun out. You know, the. But yeah, I would. I would love to see, like, the internal politics at Google where individual people are like, well, I'm not really on the Chrome team. I really support Chrome. You know, like, people are just not going to want to get spun out.
- [45:58]
Eric Franchi
So funny.
- [46:00]
Scott Howe
I'd like that to be the headline of this whole podcast, please. Liveramp launches bid to buy Chrome.
- [46:06]
Ari Paparo
So David, your PR guy is in the background. Has died. He is dead now. It's a shame. Somebody check on David.
- [46:17]
Eric Franchi
Oh, my God. Okay. Other big thing in AI land. So there's a. There is a definitive category now of what? I mean, gosh, are you early to this category of companies doing what used to be called SEO? You wouldn't call it SEO now, but SEO for LLMs optimize your site experience such that you can appear in LLM results. I've been tracking this category. There's at least 10 companies doing this and more emerging. But this is a category that is getting very hot. So this week there were two major fundraises. The first was Profound, who three months ago raised their Series A, they just raised their Series B, led by Sequoia, KMP and Khosla. So Silicon Valley is pouring into this category. They think obviously it's going to be, you know, a massive deal. And three months after the A, presumably a preemptive B by Sequoia, and then Evertune, which is some former TTD folks, they raised their Series A led by Felicis. So firms that haven't necessarily been investing in ads over the course of the past couple of years, and a category that's getting super, super hot. It's certainly one to watch, but it's also a category it feels like it's hard to differentiate in. Right?
- [47:38]
Ari Paparo
Yeah, it does. It does. And also, it's not clear if you think about the history of search. SEO didn't produce any exits And SEM wasn't a good category. E. So I think the bet here is partially just a bet that maybe this will be a big category, but partially it's this kind of like sense that it's not just going to be like SEO that's very passive, where you just organize your website better. It's going to be more of like a, Scott was saying, a two way conversation between brands and AIs and there may be fees involved in that or maybe free. And no one's really sure, but it's very clear that brands are going to have a way of some kind to have their information indexed in all of these many AIs. And that's a real problem that you know, it's good when it's a real problem and you can invest in it.
- [48:29]
Eric Franchi
Who knows what these businesses become. But a path to an affiliate business is I think one viable one where, you know, you could just help power, not just, you know, results but, but transactions. But hey, it's, it's super early days. Scott, what do you think of this category?
- [48:44]
Scott Howe
Well, I'm a crusty old guy.
- [48:47]
Eric Franchi
No you're not.
- [48:49]
Scott Howe
I'm going to tell you a story about the late 90s and early 2000s. And at the time I was helping build Avenue A and Atlas. And our clients included companies like Excite, Work.com, home Grocer, Pets.com, mySpace. And I share this story because obviously, I mean, you guys know who those companies are, but many of your listeners wouldn't. But if you go back to the start of any major industry transition, the early leaders and the early hype aren't always the companies that emerge as the winners. And so before I get too excited about anything right now, my goal is to try it and to have the partners in our ecosystem try it. I think it's so important. Like if you go to the horse races, what's the way to ensure that you're absolutely going to win? It's to bet on every horse. And so before I'm ready to declare like, what is the next big thing, I want to try just about everything. And I will tell you right now, as an industry, we have a little bit of a problem in as much as new companies are being spun up so quickly. And the challenge that I hear from many of our clients is how do I try these things? And what they don't want to do is go make a huge 10 year commitment, do an exclusive partnership and throw mega millions. They want to figure out an easy way to get started and try a Bunch of things and see what floats to the top. You know, maybe a more direct analogy is Liveramp. Today we work with 65 different DSPs. Well, there's probably only five or six that are going to emerge at the end of the day, but there was a time when we worked with even more than that number of DSPs because our clients wanted to test out the different DSPs, see what worked and what didn't. And then over time, the winners emerged. And I think that's going to happen here as well. I think we should all be really reluctant to anoint any winners until some time passes and they prove that they can generate pretty significant customer value.
- [51:25]
Ari Paparo
Yeah, and I think the VC rounds serve as a signal to try to say, hey, we're the winner, we have more capital. And that sometimes works, but sometimes doesn't. You have to have the goods in the end.
- [51:36]
Eric Franchi
Yeah, when it works, it can work really well, but in many cases it creates a lot of hurdles, frankly for the company. So. You're absolutely right. Hey, one more before we go. I know you were excited about this one, Ari. About Elon Musk, who we talked about last week making good strides on X with respect to the ad product. But this week there's a new story. What happened?
- [52:00]
Ari Paparo
Elon, he apparently has no self awareness, but he's suing Apple saying that the App Store rankings are biased and that it's impossible for Grok to compete with OpenAI because of Apple's bias in their rankings. And the reason it's funny is because basically that's the entire reason he bought X, was to change the rankings and to make himself at the top. And now him and Sam Altman are having a little pissing match on X where they keep asking. It's been entertaining. They're asking Grok. You know what's true, what's not? I think Elon put something to Grok, like who's more trustworthy, him or Sam Altman? Which is like, I don't know, saying which is the best NFL team, the jets or the Giants. Like, you know, like, it's just, it's just the whole thing is entertaining and really that's what I'm in it for. I'm in it for the lulz.
- [52:51]
Eric Franchi
I know. I've been using Grok all week.
- [52:54]
Ari Paparo
Oh yeah? How is it? Spicy Grok or regular Grok?
- [52:57]
Eric Franchi
Regular Grok. You know me, but in Imagine Mode. Have you tried this?
- [53:02]
Ari Paparo
No. What's Imagine Mode?
- [53:03]
Eric Franchi
Oh my God. You guys gotta try it. Everybody's gotta try it. Take a picture and Ideally, a picture from a long time ago, like a podcast, pre smartphone, pre even Internet picture, like when you were a kid or your parents were a kid, and put it into Imagine Mode and it will create a short video, an animation out of it. And when it's good, it is really, really good. Like, you know, just like me and my mom when I was a baby, like it, you know, really, really good. And then at times it's not there yet, but I've been playing with it all week. It's really good.
- [53:34]
Ari Paparo
Are you imagining we should do that for this podcast? Imagine us and our guests like on a couch together in a nice looking studio with like, oh, it's going to be a real picture stuffing. Oh.
- [53:43]
Eric Franchi
The point is it's. It's animating a real picture and creating a small video out of it.
- [53:48]
Ari Paparo
I'll have to try Imagine mode. Okay. I think we're out of time, Eric.
- [53:52]
Eric Franchi
I think so. Scott, this has been awesome. Thank you so much for coming on. We got to have you back.
- [53:57]
Scott Howe
Well, that's up to Ari, who's already said that I can't come back, but at this point I'm just vying for the book, so I'm looking forward to that.
- [54:05]
Ari Paparo
Ari, we'll work it out. We'll do a side deal for the book and maybe another return visit. Scott, thanks very much. This is a great conversation.
- [54:12]
Scott Howe
It was a lot of fun. Thanks, guys.
- [54:14]
Eric Franchi
We'll see you next week, everybody. And we gotta check on David the PR guy right now.
- [54:18]
Ari Paparo
Yeah, revive David.
- [54:19]
Eric Franchi
Bye. Bye. Thank you for subscribing to marketecture.
- [54:23]
Ari Paparo
New interviews are added every week at Marketing and your favorite podcasting app. Thank you for listening to the Market podcast. New episodes come out every Friday and an insightful vendor interview is published each month. You can subscribe to our library of hundreds of executive interviews at marketecture tv. You can also sign up for free for our weekly newsletter with my original strategic insights on the week's news at News Market tv. And if you're feeling social, we operate a vibrant Slack community that you can apply to join@adtechgod.com.