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Episode 140: What is publisher data really worth? With Arcspan’s Art Muldoon
00:52:15
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- [00:01]
A
This podcast is brought to you by Adelaide. Media verification and measurement are undergoing major disruption. Legacy players are pivoting to performance, advertising AI is reshaping brand safety, and attention is replacing viewability. Adelaide is leading the shift with au, a new way to assess media quality that scores placements based on their potential to drive attention and outcomes. Before your ads run, think of it like a credit score for media. Finally, a clear view of quality. Before you buy, take the guesswork out of your investment strategy and try Adelaide AU on your next campaign. Hey, this is Ari with marketecture, and unless you've been living under a rock, you've probably heard that Market Live is coming up October 27th in New York City. The last Markitecture Live was sold out and this one will surely be as well. With speakers like Mark Grether of PayPal, Eric Seufert of Mobile Dev Memo, and Jenny Wall from Videoamp Plus, I'll be recording my podcast live with the one and only Antonio Garcia Martinez, author of Chaos Monkeys and now part of the team building at Coinbase. It's a stacked agenda and we hope to see you there. Go to marketlive.com and grab your ticket while they're still available. That's marketing. Welcome to the Mark Zedra podcast. I'm Ari Paparo, joined by Eric Franchi. As always, Eric, how you doing this morning?
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B
Doing well, Ari, how are you?
- [01:33]
A
I'm excited to be here. We've got a great guest, Arthur Art Muldoon from arcspan, who I've known for many, many years. He used to be at Accordant, which was a buy side platform, and I would go into his office pretty much every two months and try to get him to switch to Beeswax off of Appnexus. And I was ultimately unsuccessful. But I'm not going to bring that up. That's water under the bridge.
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B
That's right. Accordant was acquired by Gentsu, I believe, and Art stayed there for a couple years, spun out and then started a publisher facing business called arcspan, which we're going to talk about. And the publisher side is so fascinating. These days you hear all this stuff about the Open web is dead and publishers are under pressure and yet there's startups that are focused on some of these challenges and building business around it.
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A
Yeah, I sometimes disparage publisher side businesses as being sort of one dimensional, just like make me more money. But there's really a lot to it, especially at larger publishers because they have all these flows of data and behaviors on them and it's pretty Tricky to get on top of all that. So I think that'll be interesting conversation.
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B
Yeah. Arcspan is in the middle of all that.
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A
It is. Okay, so community notes. So starting On Monday the 22nd, I am going to be down in Virginia doing my reporter thing where I'm going to be following the Google Remedies trial. And I know there's some confusions. I just yesterday someone was asking me if the remedies are coming out on Tuesday or Monday. No, no, no, no. It's a trial. There's two weeks. There's a two week trial that's going to happen where the DOJ and Google are going to argue about what the remedy should be. So I'll be reporting from that daily at the Monopoly Report. So I'd really recommend subscribing to that newsletter. It's monopoly-report.com or Monopoly Market TV will both go there free newsletter and I try to keep it fun and snarky based on what happens in the courtroom every day. And then, and then we'll be do. We'll still be doing this podcast next two Fridays where we'll probably have a little more Google content than usual. If you find that boring, just put me on 2x speed during that segment of the podcast.
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B
I love that you said community note because I was wondering if like you use, you were going to use it in the proper context and you did community Community Note yourself in clarifying what was going on. So well done.
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A
Not everyone is like, you know, poring over the details here. You know, like your average listener to this podcast is probably like following it but not really sure what's going on and how would it affect their life. Still unknown, you know. Right. So let's watch it. It'll be fun and I'll be enjoying beautiful Alexandria for the next two weeks. So if I don't respond to your emails, that's also the reason. And just a general reminder, Market Live is coming up on October 27th. So we're like five weeks out. Tickets are fast. If you want to go, I'd recommend buying a ticket because once we sell out, you won't be able to. We're also going to be announcing maybe next week the finalists of the startup showcase that Eric is hosting. We have, we're going to have five great startups presenting there and it'll be Eric and Sonia from S3 Capital or.
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B
S4 Capital, S4S Ventures. S4S affiliated with S4 Capital. It gets confusing sometimes.
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A
I knew I got that wrong. So that'll be exciting. So Maybe next week we'll be announcing the found the. The finalist. If not, it'll be the week after that. So stay tuned for that. So with that, let's get into the interview with Art. Art Muldoon from arcsman. Thank you for joining us.
- [05:07]
C
Thanks for having me, guys. Good to see you again.
- [05:09]
A
Yeah, absolutely. We've wanted to have you on for a while. I guess you've been on before on a vendor interview.
- [05:14]
C
I think this is actually my first time connecting with you live. In the real. In the real. I haven't done the vendor interview, so maybe that'.
- [05:22]
A
Followup. We got to have you on for that. So I'm an advisor to Arc Span and Eric, are you an investor here?
- [05:28]
B
Yeah, my fund is an investor in Arc Span.
- [05:30]
A
Okay, so we got that out of the way. We need to disclose more often. We often forget because we're basically invested in everything. Only the best. Only the best companies though. Yeah. So. So Art, what, let's start with the basis. What, what is Arc Span?
- [05:45]
C
Yeah, well, thanks again for having me on you guys, and really excited to be here and you know, have a chance to, you know, talk to your listeners about what we're all about. And so arcspan is a sell side audience monetization platform company that we launched well over four years ago. But really principally two years ago when we launched the ams, the audience monetization system, as an enterprise class platform, we've been seeing a lot of traction, a lot of positive momentum in the market. And principally what we're focused on is helping publishers turn their data, their audience signals into scalable revenue. And what we've come up with in a way to try to simplify and organize the revenue operations challenges that publishers face is to really build around a AAA framework which we call aggregate, amplify and activate. And so the world today has been focusing on sourcing first party data. And if you're a publisher, your first party data actually can reside in a whole rat's nest of locations from legacy data warehouses. You might have logged in visitors, you might have newsletter visitors, you might have email lists, you might have some CDPs you're working with. We try to really process, ingest, organize and normalize all of those sources of signal into, you know, being a super signal aggregator. But we don't stop there. What we do is once we've aggregated these signals, we put it in a platform environment with tools for publishers to build audiences, manage audience deals, scale audiences from the deterministic data, to model data, and put quality filters on so that they can activate into their chosen environments with efficiency and effectiveness. So we came into this seeing that the marketplace had really evolved with the focus on first party data, with a focus on machine learning and AI driven opportunities. And we've built kind of greenfields from scratch with that intent. So, you know, that's really been focusing for us. We're now global. We've got customers in North America, in EMEA and in apac. We're getting, you know, recognized through Digiday, Ad Exchanger Awards. And I guess I'd say, you know, my, my daughter's gotten into becoming a DJ and DJing tools and I can see that we're somewhat, somewhat like the DJ for publishers where we mix, we amplify, we drop the beats so that publishers actually get pa. How about that?
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A
That was, I appreciate that twist at the end, the metaphor twist. I was not expecting it. That was just a left hook out of nowhere.
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C
Okay, I have to set you up.
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B
Somehow, especially from the mild mannered Art Muldoon.
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C
Yeah, sometimes I like to hit my own punchlines.
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A
So if Terry Kwaja is watching, please, please create a video of Art Mildoon behind the turntables. We know you have the capability to do that, to make that happen. All right, so you said a lot there. But you know, traditionally the story on publisher first party data, or second party data some people call it, was that it was nice but not great because it didn't have scale. So even if you know a lot about your audience, a single publisher doesn't have the scale to do anything with or do much. They could target ads on their own website. But from the advertiser's perspective, third party data was always seen as more, more valuable, even if it was a little less accurate. So has that changed?
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C
Well, it's still a combination. But what some things have changed, Ari1, is, you know, what you started out by saying is that if you're a single publisher, you don't have scale. Well, what single publishers have been doing is actually trying to monetize only about 30% of their audience. That was all they really knew, was the most addressable part, that they had maybe some knowledge about some logged in users, some understanding. And so what we do is make 100% of audiences addressable to start with through contextual processing tools, as well as what you're mentioning about layering on sort of third party data providers to add, you know, behavioral demographics, psychographic, technographic enhancements. So first of all, the housekeeping a publisher can do is to really scale its own opportunities Better to make their single publisher entity that much more, you know, manageable and, and really reachable for an advertiser. But you're right, you know, without third party data, which had kind of floated all ships, publishers are going through sort of a reformulation right now to get the most out of their first party data. And we're just showing that there are more sources of that. There's, there's more ways to generate, you know, first party information. Publishers are now doing, you know, more polling, more surveys, more newsletters. They're, they're, you know, considering, you know, getting through different types of, of opt in environments. So there, there, there's more publishers can do and we think that seeing, you know, the, the evolution of modeled audiences, but with AI tools that can add quality to the scale and accuracy, that there's still opportunities for growth for publishers.
- [11:31]
A
Right. The other sort of thing that is generally thought about publisher data is there's a trust factor. The buy side needs to trust the sell side. And you know, you're telling me these are valuable audiences. How do I know? What's that, what's that dynamic like nowadays?
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C
Well, just what you said, like having us tell you that is presumably more believable as a third party than having the publisher tell you that directly. And so we are really endeavoring to be that additional third party that can be standing for sort of standards for the way we process data consistently across all of our publisher base so that there's an understanding from the buy side that they understand with transparency and controls how the data is processed, how the audience quality is determined so that it's not just, you know, what a skeptical buy side or might think when suddenly there's more inventory available and it happens to be the end of the quarter, you know, that this is real verifiable quality, but with transparency.
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A
Right, so you just raised money, right. What's it like raising money for an ad tech company? You just call up Eric and he writes you a check. Is that the situation?
- [12:52]
C
Well, you know what, I got a shout out to a perium. Thank them. They are leaders and they're really very active in our space and they understand the dynamics and where the value is in the marketplace. But it is tough right now to raise money. I mean, there's a lot of caution amongst investors today. They're being very selective, I think, about where their work, where capital is being placed. So what we learned was that the emphasis on solving a real problem, recognizing that there is a source of differentiated technology in how we're building in a First party AI driven environment. But also seeing that publishers, you know, they're under assault, they're, they're what has been a traditional revenue operations system for them is fundamentally changing. And so the impact of first party data, AI and opportunities for publishers to take the value proposition back for them I think is what really got our investors excited about seeing that the AI development, the first party data can certainly support publishers and, and that we need to have a thriving ecosystem where the supply side is just as healthy as the buy side. And so I think that's really what our guiding, you know, North Star was to get the raise done right.
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A
There's just so much negativity right now about the open web and this idea that the open web is going to be strangled by AI and lack of traffic and, and it seems to be the, the from anecdotally many publishers are seeing pretty huge declines in volume this year. What are you seeing and how does that also what did, how that come into play in your fundraise.
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C
Did play a role and we are seeing it but you know it's you know like that Monty Python scene, you know, bring out your dead or not dead yet. You know that's, that's kind of where I, I see a lot of the, the head and the open web is not dead. I think it's evolving and there's a reformulation taking place. We see a lot of banner we read about every day like the transaction IDs is another topic that plays into this as well. But ultimately we think that and I've come from the buy side before this so I do understand you know how we used to target in the audiences in the open environment and you know always be looking for more ways to get efficiency and scale and effectiveness. And so what I see us and I mean it's self serving because it's where our platform is focused. But there is more value and more deals moving towards direct deals, towards PMPs and towards the curated marketplaces and, and I think that's because advertisers can get more transparency and a sense of quality in their buys. It's for publishers that part of their revenue monetization hasn't been their largest. It really has been in the open web. But they're, they're seeing that with more tools available I think that that can play a bigger role. But I don't see the open web going away. I think it's a flight to quality and, and standards that prove quality.
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A
So you mentioned tids, which is a hot topic and I think we'll be talking about a little bit in the news section. What do you have some you know, hot take on that or how are you, how does that relate to your business?
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C
Well, I don't have a hot take. I'd say, you know, we, we are a specifically publisher side focused business. That is who, you know, we really want to see succeed and support in the environment. And so I do think that it's important to protect publishers from being taken advantage of. And in the sense that in this, in the TID discussion that there's an angle where the buy side, you know, is same, you know, they're, they're, they're looking to deduplicate in the, in the, you know, efforts of gaining efficiency. We got to make sure it's not just a back channeled or thinly veiled way of taking more advantage of publishers in the end. And so, you know, somewhat equivocating, but I'd say what we really want to see is what's good for publishers in this, in this equation that kind of.
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A
Lends itself to my next topic I wanted to bring up, which is curation. It feels like your company is on the opposite side of curation. You're trying to use publisher data to make their deals more valuable, whereas curation is when someone brings someone else's data to make it more valuable. Is that fair or are you in the curation business too?
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C
We have been kind of on the sidelines of curation until more recently where we're getting more involved in that because our publishers are asking us to. And so we think that, you know, with our, you know, kind of clarity and vision around giving publishers control to own their signal and control their revenue, we're engaging in new, new curation tools that, that bring transparency and control for the publishers in this. So thus far curation has really been kind of, you know, a kind of crass way of saying there's, there's third parties who are siphoning off margins and creating curation deals that really haven't derived into greater revenue or greater CPMs for publishers. And so for us as a publisher side focused entity, we're, we're interested in developing partnerships that are bringing buyers to publishers with opportunities that will enhance publishers fill yield but higher quality. And so the current I think kind of range of curation solutions don't really do that. And as you said, that there's opportunities of curation that kind of fill placements for publishers, but they can also leverage the publisher's data. But that needs to be done in a way that's transparent for publishers. Many publishers have participated in curation by getting, you know, they're happy to get a check every month, but they have no idea. There's no backup, there's no detail, there's no information about what's driving the, that, that revenue that they're receiving. And so now I think they're asking more questions and they want to get, you know, more clarity to make sure that they're getting fair value for their data as well as their placements.
- [20:11]
A
So I mean, it's a complex conversation, but like so public. It sounds like from what you're saying, some publishers are okay with curation, some are suspicious, they don't want to be taken advantage of, but they want to participate. It seems like it's a complicated decision process for them.
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C
It's totally complicated. They've been, they sort of begrudgingly participate. But I have really heard from very few publishers who say curation is like the, the real opportunity and is really driving their business. They, they take some revenue out of it, but it hasn't become really strategic for them.
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A
Right. And I guess this kind of goes to your core value prop, which is like, are there some publishers who have just a lot of data and a lot of context and other publishers who just have bulk and don't have that? Like you think about gaming, for example, not a lot of context in gaming, especially if you don't have a login.
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C
Yeah, I think it is good to look at different verticals because, and then different strategies that publishers can enact because it's not a consistent solution across. So you're right. Gaming, we do a lot of custom taxonomies in the gaming space for publishers because the IAB audience taxonomy only goes so deep, but it doesn't get into game titles, genres, platforms, all of that. So that's where, you know, taxonomies are kind of evolving specific to industry verticals. And then that's where different types of curation plays can, can come into play because advertisers are looking, you know, to, for targeted audiences and in a guided curated environment. So yes, that's, that's, that's why we look at say gaming different from news, you know, different from sports. They're all viable, but they have different sets of rules.
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A
Eric, I'll ask you a question as an investor. Do you have a thesis on buy side versus sell side in advertising?
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B
Sure. I think art put it quite well, which is that to date there's been so much emphasis on the buy side and it makes sense. Most of the Large businesses, particularly public ones in ad tech, have been buy side enabled. But with I think the shift to CTV retail media and the rise of things like creation, I think that there's an opportunity to build big businesses on the sell side. And you know, it's funny, increasingly like we've been talking about this depth of the open web meme for a long time. Probably like when it first started, it probably started with the marketexture podcast. And I'm increasingly questioning, right? So it's like when everybody is saying something, you should pause and question, like wait a minute, if everybody's saying this thing, is this really true? Right? Like is, is there a contrarian take to, to be had here? And you know, like I, I'm feeling that this whole open web is dead thing is, is possibly overdone and, or showing us that there is businesses to be built. Because I don't think, I don't think that publishers go away. Gareth Glaser said something that's been ringing in my head for some time, that there's like a set of publishers that people are pulled to. They're not the gaming publishers, they're not the recipe sites. Right. Like I think a lot of that stuff does get eaten by the LLMs, but the premium publishers think that there's going to be a play for them. And I think that there's business models that are evolving right now that are going to address their needs and be great businesses. So long winded way of saying that, like I increasingly am like interested in pub side technology because there's just a whole bunch of things that are coming together.
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A
Interesting. What are you seeing like in that sort of evolution of, you know, the way consumers are behaving and you know, AI and all that?
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C
Well, well, my take is, I mean I've been doing this for a long time, Ari, that look, I am bought into the belief that there are audiences, human audiences that are out there and there are and that advertising is a model that chases eyeballs. And we've seen new technologies fragment audiences and then advertising follows it. And so whether we got into podcasting, which is now viable advertising medium, the audiences are there, we got into gaming. There's a lot of different evolution changes to advertising. And so, so open web is one thing that might be reformulating and evolving, but AI is having I think a very big impact in driving the viability of advertising into new and fragmented audience groups. But it requires a lot of data understanding, the addressability factor, the accuracy factor, the creation of quality which leads to trust and I think when you get addressability, accuracy and trust, then you get into viable advertising, audience driven markets and you can generate scale. So I'm bullish on it, but I think we all just know the change is constant and we've got to be wary. Some publishers, as Eric said, may not have a really defendable audience, but not all publishers are going away and it and there'll be new opportunities there.
- [25:43]
A
All right, that's a good place to, to pause. So very interesting conversation about publishers and their data. Let's take a quick break. We'll be back for news on M. And A. AI. You know, the usual stuff that we talk about every week, but there's always new news, so we got to keep doing it. All right, we'll be back in a second.
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B
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C
The tid.
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A
Tid.
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B
Give us the TID update.
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A
Yeah, it's a quick little TID update. So if longtime listeners may recall that just two weeks ago we had Michael Sullivan and Chris Kane here debating the transaction id, the unique identifier that lets DSP sort of deduplicate traffic. And there was this giant controversy because the Pre bid. Org removed support for tid. At the very same time is that Pre Bid sent out an email to its members this change and got a copy of it. And it basically says I'll read a quote or two. But basically that the risk of that you could stitch together consumers across multiple RTB requests and identify them. Also, I'll read this. The broader market risks, the identifier could be used to attack publisher deals as redundant with open market inventory. So effectively what that's saying is that if you had, say, a private deal and it was at a certain price and you had an open deal and it was a different price because of the tid, you could stitch those two together and effectively open arbitrage the inventory. The last thing, which is just a little, you know, a little tea, is they really threw the IAB under the bus. So I'm going to read this quote. This is from the email. Conclusion if this change is negatively impacting monetization, the real question is why given its limited scope, its legal grounding and the IB stated intent. Furthermore, how can we as an industry be satisfied with a framework that has serious data leakage issues as a standard for trust and transparency? So the subtext Here is the IAB runs the OpenRTB standard that says TID should work a certain way and pre bid is implementing that standard in a way that doesn't agree with the standard. And so prebid is saying that. They're saying why is the IAB upholding standard that's got problems more or less. And you know coincidentally I'm giving the keynote at the upcoming pre bid summit next month, so that'll be spicy art. Do you comment on especially the arbitrage question?
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C
Well I will be at that event to watch you navigate this so I'm looking forward to that. You know. Yeah that, that arbitrage argument. Look we, we, we capture in our like in our analytics and reporting the, the pre bid values of the marketplace and we see, so that we can help publishers see what pre bid value of audience segments on their site may be and they, they themselves can then compare that to the direct deals that they're doing as well. It, it gives both publisher sales teams an opportunity to look at where maybe market demand is that they might be missing but also you know I think validating what they're selling against where the OpenRTB may be. So I haven't done like that analysis already to compare the two but it exists, it's right there like on our screens in front of our publishers to, to assess but I think should be that they are seeing the way to you know craft a direct deal. Should speaking specifically to a publishers are, I mean an advertisers RFP should be worth more.
- [30:14]
A
Yeah. So I mean this ties to curation too. So if you have a single auction and let's just say it goes through open an open auction at a certain low, relatively low floor price and then it's curated with some really valuable data segment for much higher price and they both have the same transaction ID on them that's a problem.
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C
Definitely. Yeah. That, that you can't mask. You can't be two and two in one.
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A
Yeah. I don't know if when they do curation that changes. That might be. That's a nuance that probably is platform specific. All right. Well we shouldn't beat this horse to death. It's an interesting situation it is.
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B
What do you think happens?
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A
I don't see how Prebid can maintain its position that they don't support this at all. I think they'll probably have to go to a compromised position where it's a setting or something like that, because the pressure is from the buy side and they have the money. So if the trade desk goes to a publisher not to exchange and says, we're not going to buy your inventory unless you restate your tid, then the publisher has control over their page and they can choose not to use Prebit or to fork it or do whatever they want. Right. So I don't see it sustainable that a middleman can determine a policy like this.
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C
We're not at the final state yet.
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B
Yeah. Okay. All right, let's get into some juicy stuff. We got some M and A this week. First on the docket, Rembrand merged with Spaceback. We've had space back on the pod, actually, recently, this summer, we had Casey on.
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A
Right, we had Casey on recently.
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B
Yeah, yeah. So Spaceback helps brands take their social content and turn them into ads. Rembrandt, who I believe we're going to have Omar on in a couple of weeks, helps brands use generative AI to find and put ads in various places. Started with creators and now they do it, you know, across everything. So this is now like a pretty neat company that gives brands the opportunity to leverage AI and like do all sorts of interesting things across all digital formats. Should note that they were both investments of Apparium. So we're thrilled about this. And two things and I want to get your guys takes. The first is the pace at which Rembrandt is moving is pretty impressive. So this is their second acquisition this week. I'm sorry, this year for a series A company and obviously Omar is an incredible operator. And then number two, I think your thesis, Ari, that these standalone generative AI offerings are not really companies, but you start putting these pieces together and all of a sudden you have next gen creative platforms with interesting capabilities. Seems to be playing out with this deal. What do you think?
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A
Yeah, I think you're right in saying that. I am right.
- [33:14]
B
I always walk into this.
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C
That's the takeaway.
- [33:20]
A
Well, more or less. If you go to a brand or an agency and say, hey, we're using AI to make your creative better and cheaper, they're going to say, well, we could do that ourselves or we'll wait for Adobe to do it or we'll do whatever, or maybe we'll try it. It's not a very Compelling problem. But if you say, well, we'll help you create creatives that are specific to media and that generate results that you can't do yourselves, that's much more interesting. Even though it is, you know, go back to the Future AD Network 3.0, whatever you want to call it, it's still the idea of bringing together accommodation. I think it's similar to the deal we talked about last week where Magnite bought. What's the name of the company they bought? Thank you. Streamer. Because Streamer wasn't an AI video company. It was an AI video ad network, more or less. They, they, you created the ads, then they bought them. So I think that combination has opportunities.
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B
Absolutely. There's a history of it. I think it's, you know, to your point, it's being modernized with AI I look forward to digging into this one further with Omar in a couple weeks. Another one. You caught this yesterday. I missed this. Verve bought Captify for about 25 million euros. And the numbers stuck out because Captify was a decent sized business. Like, yeah, this is public stuff. 40 million, 41 million in net revenue. 30 employees.
- [34:44]
A
Yeah, the 30 employees is a weird number, I think because I asked around. I think it might have been 30 sales employees or something. Let's just take 30 employees off the table. Yeah. So Verve is owned by media and games investors. The a German holding company that sort of is definitely a discount shopper for ad tech assets. Let's just say that. So 41 million in revenue and they bought it for 25.6 less than 1x revenue. This is a little bit sad because Captify was acquired by a private equity firm in 2021, probably at the height of the valuations for 120 million. It was. They had a really nice can cabana. You ever go to the can cabana? They had like people were actually getting in the pool. It's rare at an industry event that people are getting into their bathing suits. Very excellent parties and, you know, pour one out for that.
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B
I was not invited.
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A
You know, you had to take a little shuttle bus up to the hills and stuff. It was really sweet. Oh, okay.
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B
Yeah. I do wonder if Verve just given your. Your point about them being a price sensitive buyer. We'll keep that pool party going in the future.
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A
I think they stopped already under private equity ownership. I think the party stack in the past. So, I mean, you could put this under the category of the death of the web. Because Captify's business was mostly, I think like getting search intent from landing pages and then using it. But I don't know if that's really, really real or not. The point is that the business is sort of a shadow of what it once was.
- [36:19]
B
Yeah, it's being kind of billed in the headline as one of the largest search intelligent platforms outside the walled gardens, analyzing the search behavior of up to 1 billion daily searches and aggregating about 400 billion active data points per day. So is this acquiring for the business? Is this acquiring it to feed Verve's existing machine learning models? Probably. Is the reason why the price is what it is?
- [36:45]
A
Yeah. If you have a target on what would be affected most by Google's AI overviews, it would be search intent data on landing pages.
- [36:53]
B
Search intent outside of walled cards?
- [36:56]
A
For sure.
- [36:58]
B
Yeah, yeah, for sure.
- [36:59]
A
All right, can we follow up with art? So art, how valuable is that sort of data to publishers, what people are searching for? I know referral data is not fully provided anymore, but you do get some idea of what people are looking for, right?
- [37:13]
C
Yeah, they do. And you know, look, search volume, your referrals has been hit, hitting publishers hard. So they're, you know, I think there's some sentiment that there may be higher quality. And so this is again shifting towards not just getting kind of raw traffic, but if you're getting more quality, more, you know, directly relevant traffic, then that's something that should be turned into value. So again, the challenge for publishers is how adept can you be to convert what might be now more really directly relevant and higher quality traffic that you don't yet detect and converting that into future value. So this search intent data will be important for that.
- [38:01]
B
Got it. All right, cool. Let's talk dsps. There are a few announcements this week that I thought were interesting that we should tick through. So the first was, and maybe this was the largest, Amazon announced that they were launching their gen AI Creative tools. So, you know, I think there's two narratives that we've been talking about for a while on the creative front. So it's, you know, number one, the need to kind of create these full stack or end to end capabilities. And then number two, you know, every media platform is going to have its own creative capability. And we've seen it obviously with Google with PMAX and Meta with Advantage plus. The data point that we keep coming back to is now the number of meta customers using their gen AI creative tools is now measured in the millions. It was only a matter of time before Amazon did the same. So Amazon launched their gen AI creative tools and I think it's interesting with Amazon is. Amazon can draw from all their data and all of the products that the brands have. And I think it's one less hurdle for a brand advertising on Amazon. So this could activate, you know, a lot of, a lot of new customers, a lot of SMBs.
- [39:13]
A
Yeah, I think when I look at Amazon DSP, obviously it's doing really well, but I don't have a sense for the breakup by customer type. SMB, mid tier, Holdco brand direct. I just don't. I'm totally ignorant. I just assume it's, I assume it's smaller than, certainly than the trade desk and other peer to peer DSPs because they have such a long tail of manufacturers who sell the products on their site. But I don't have any in data. So this is an interesting signal that they want to get stronger as they go down the tail.
- [39:47]
B
I think that's right. And then also presumably because these are ads that are going to be native to Amazon, somewhat like with Meta, if you can, you know, train these to become that much more performant on your, your own inventory because you know, who, who the signals better than the walled garden. I think it ends up probably being a real catalyst for increased spend.
- [40:12]
A
Right. But this is also very DSP centric. Right. This is off site for the most part because it's displaying video. I mean it could be on site too, but mostly on site is like product listing ads and stuff like that.
- [40:22]
B
True, true. Yeah, I guess you're right. It could be both two things on the TTD front. So the first was maybe surprise, maybe not surprised. They updated Cokai removing the periodic table. This was notable because I think Trey wrote that epic piece a month or two ago. Ad tech explained, kind of pointing to how this was one of the things that was confusing buyers. And then they removed the periodic table. I don't think it was because of Trey, but I think it's notable that they made a big change to the dsp.
- [40:58]
A
Yeah, never. Product managers out there never use a metaphor. Metaphors don't work in ui. Just never ever do it. You want to. You think you're being smart, but never ever use a metaphor.
- [41:09]
B
Yeah, this is true. And then this just hit. Right before we recorded, Adweek interviewed a bunch of buyers who are shifting spend from TTD to the Yahoo DSP for lower rates. You have better knowledge of just the ins and outs of the DSPs than most people. How much are you losing by shifting from TTD to Yahoo? From just like an inventory, a data, a capability standpoint.
- [41:38]
A
Yeah, it's varying. I Mean, Yahoo's key selling point is that they have unique data because they have the email and search data that nobody else has. Trade Desk does not have that. But Trade Desk has some more mature investments in say, inventory SPO certain, their data alliance. So it's not apples to apples. There's pluses and minuses and it probably is advertiser specific about which things you value the most. I'm a little surprised that this is very so focused on rates because I don't think of Yahoo as like a discounter or a cheap alternative. I think that my understanding is their pricing would be right down the middle with the other major DSPs. So I think that's the interesting nuance here. Is this a strategy that Yahoo is competing on price or is it just, you know, some movement of accounts? That's not a particularly large trend.
- [42:31]
B
Yeah, no, it's a. That's the question. Quick scan of the piece. Was the former that they were going. Going aggressive on. On rates. You know, it's been so much, so many weeks of, you know, just like negativity on TTD and all this. You know, this company's going after them for rates. This company is going after them for rates. I'm wondering what their response is going to be because there's going to be a response here and you know, just like another truism of never bet against Jeff Green. I think it's going to be interesting to see what the turnaround efforts commercially are going to be for ttd because there's got to be one. Do you have any sense for what it might be?
- [43:16]
A
I think that I like to say someone's strength is often a flip side of their greatest weakness. And Jeff's strength, as far as I could tell, is that he's like monomaniacally focused on a certain thing and has been really incredible at making the Trade desk just not vary or waver at all. And that's also his greatest weakness. We haven't. I mean, this news aside that Kokai is no longer using a periodic table, I get the sense he's pretty stubborn about his vision. So I don't know that we're going to see some sort of grand change or, or anything. I'll be surprised if we do see it.
- [43:56]
B
Yeah. Okay, so your, your take is TTD stays the course, stays focused and, you know, executes, presumably if they execute their way out of it. Executes their way out of it.
- [44:09]
A
I think that would be. My guess is. Yeah, I wouldn't expect to see some. Certainly we know not to Expect big M and A. I'd be surprised if they did something like cut prices radically. I mean, that certainly wouldn't help the stock price. So I don't know exactly what you would expect them to do.
- [44:24]
B
Yeah, got it. Okay. Shout out to Seb Joseph from Digiday. He did an interesting piece again, a thing that we've been talking about.
- [44:35]
C
Over.
- [44:35]
B
The course of the past year so on S4 capital and how they're getting super aggressive on AI S4 capital. We've mentioned this. They cut their revenue forecasts, they're doing some reductions in forests, and they're getting out ahead of it and basically saying they're repositioning the business as an AI workforce company. And there was a line here that I thought was worth repeating by wes Terhar from S4 Capital. He said 65% of agency tasks can already be automated by AI agents today and they're shifting the business to take advantage of it. So something to keep an eye on. But they're the first that we've been waiting for this, right? An agency to say, hey, we're aggressively moving in a direction of AI. It seems like they're the first.
- [45:29]
A
Yeah. I think, like, being in a poor position forces you to make hard decisions, whereas if things are going really well, you invest around the margins.
- [45:38]
B
Yep, yep. This is true. This is true. All right, let's talk about Google RTB data sharing. Walk us through this.
- [45:47]
A
Yeah. So this was written about extensively in the monopoly report by our colleague Alan Chappelle. Long story short, Google have has a settlement on privacy grounds that says that they will allow consumers to opt out of RTB data sharing, meaning when Ad X is auctioning off an impression. If you had opted, if a consumer had opted out of this thing, no longer would any identifiable data be sent to the dsps. So I personally think this is a nothing burger because first of all, consumers would have to opt out. Secondly, worst case scenario, you just buy through a different ssp. Google's not the exclusive SSP of the vast majority of traffic. And Google to Google, meaning AdWords or DV360 would still have the data. But Alan thinks it's a big deal because it gives Google another sort of lever to manipulate the market. More or less interesting. Just as much as I know. So watch this space. Are there any thoughts on this one?
- [46:48]
C
Well, I was wondering if this is just another note to publishers to own your signal and control your data and it can derive value for you to transact directly or in package deals and not worry about what the next identifier is going to do to lift your incrementality.
- [47:08]
A
Certainly it's a message to publishers to have a lot of options and to control things because you don't want to get cut off by one. One supply path or one partnership?
- [47:18]
C
Yeah, I think so. Yeah.
- [47:19]
B
Well said. And then also on the Google front, another week, another company is suing Google. Magnite is suing Google. On the heels of Pubmatic just announcing that they are suing Google and very similar lawsuits, you know, alleging that their business was harmed through Google's practices and seeking damages and changes. Most notably, they don't seem to have acquired the custom URL that you secured and squatted on. Domain squatting is back.
- [47:53]
A
Yeah. If anyone wants to buy magnitevgoogle.com venmo me, I don't know how much, like $99.
- [48:01]
B
50 bucks.
- [48:03]
A
50 bucks. I will provide magnitevgoogle.com to interested parties.
- [48:08]
B
A nice 2x return on the domain.
- [48:10]
C
What is the ADEX pool up to?
- [48:11]
A
It's. The buying ADX pool is up to only around 200. I think GoFundMe is cutting me off because I. I don't want to actually take people's money. Right. So it's in limbo, that whole thing. Oh, I want to revise it. It's $50. If you're magnite, you could buy that domain. If you're anyone besides Magnite, it's like, I don't know, $1,000. If you're Google, it's $10,000.
- [48:38]
B
Well said. All right, let's. Let's end it with one update on something we were talking about a bunch of last year. And finally, the TikTok US deal has been finalized. Oracle, Silver Lake and Andreessen Horowitz will control TikTok's U.S. operations under a new 8020 framework with ByteDance, meaning 80% U.S. owned, 20% Chinese owned, an American board with U.S. government oversight, and a new U.S. only app with a separate algorithm from global TikTok. So it happens.
- [49:12]
A
It happened. Well, it hasn't actually happened. We've had rumors. Right. Or is it officially announced?
- [49:18]
B
I think it was finalized.
- [49:19]
A
I don't know. My hot take is I prefer the Chinese communist government to that group of people.
- [49:31]
C
Okay, no comment.
- [49:36]
B
Okay. I thought it was notable that Oracle.
- [49:40]
A
Speechless on that one.
- [49:41]
C
Yeah. Where do you take that?
- [49:45]
B
All right, let me just say something I thought was interesting. So Oracle, a week or so ago, their stock, like ripped 30 something percent because they had a massive commitment from OpenAI. Larry Ellison, briefly, was the richest person in the world. As a result of that, this is going to be maybe interesting to a few people, but I just got to get this out of my head. Elon Musk was unseated as the world's richest person. As a result, Elon went and took a billion dollars in cash and bought Tesla stock. Tesla stock ripped, making Elon once again the richest person in the world. So I don't know if these guys watch this stuff and there's a battle of the number ones going on here. I thought that was interesting. The other thing is Larry Ellison is 81 and he is on.
- [50:34]
A
It's good. He looks good, man. You see pictures of him. He looks like he's 60.
- [50:38]
B
He does not look 81.
- [50:40]
A
No.
- [50:41]
B
I don't know. It's interesting.
- [50:44]
A
This is obviously capitalism as Adam Smith envisioned it.
- [50:51]
B
This is true, man. We all look that good at 81. And with that, I think that's the pod.
- [50:56]
A
Yeah, I think that's quite a roundup. All right. Well, Art, thank you so much for joining us. Arc spans the company. Really interesting overview of your business and how publishers are evolving. Thanks for being here.
- [51:12]
C
Thanks for having me. Really appreciate it. Good to see you guys.
- [51:14]
A
Always great seeing you. Next week I think we'll have kind of a mixed show where we have an interview and then separately we'll be doing the news from the trial in Virginia. So look forward to that episode next week. Week.
- [51:28]
B
See you next week, everybody. Thank you for subscribing to marketecture.
- [51:32]
A
New interviews are added every week at Market TV 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 Monday. 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.