Video ad measurement rivalry is so fierce, it’s spilling from the boardroom to the courtroom.
Last week, a jury in California awarded $18.3 million to video measurement firm iSpot to resolve its lawsuit against EDO, a measurement company co-founded by actor Ed Norton.
The suit, first filed in 2022, alleges that EDO breached its contract with iSpot by misusing the latter’s TV ad data to build a competing product.
ISpot had sought $47 million in damages based on its calculations of the harm EDO allegedly caused through its actions. Although the jury awarded iSpot less than half of that number, it agreed that EDO had violated multiple contract provisions, including exceeding data access limits beyond contractual terms and using that data to develop rival tech.
“Measurement is the business of trust, transparency and accountability, and EDO proved they have zero regard for any of that through a pattern of data theft, obfuscation, evidence deletion and lying,” iSpot said in a statement shared with AdExchanger.
EDO plans to appeal the decision, dismissing iSpot’s accusation as a “desperate attempt to slow down a smaller, smarter competitor,” according to EDO’s statement.
However, an internal email viewed by AdExchanger suggests EDO did intend to use iSpot’s data to build a competing product. In a September 2017 message, sent by EDO CEO Kevin Krim to Norton, he mentions the company’s intention to “transition away from iSpot and steal their business.”
A behind-the-scenes peek
According to the complaint, EDO, which was founded in 2015, allegedly began misusing iSpot’s data shortly after becoming a client in 2014, back when EDO still went by the name “Big Data Box Office.” (It later changed its name to EDO, which stands for “Entertainment Data Oracle.”)
At the time, the Norton-backed company was looking to build a business helping studios predict box office sales.
ISpot’s client contracts explicitly prohibit the use of its data to “build any services that compete with iSpot or give the impression that they compete.” But, in 2016, Sony alerted iSpot that EDO had pitched it a product that appeared very similar to iSpot’s. Krim has denied this.
While iSpot threatened to remove EDO’s access to its data after Sony’s tip, the two companies maintained a contractual relationship until 2018.
In 2017, EDO gained expanded access to iSpot’s dashboard through a mutual client for whom EDO was conducting a project. Although EDO’s contract was restricted to the movie category, it was able to access viewing data across all verticals through this mutual client, which iSpot identified as Disney.
EDO did not renew its iSpot contract when it lapsed in early 2018.
But a 2017 internal email between EDO executives with the subject line “iSpot API” indicates that the company was considering a plan to maintain access covertly. The email, which was also viewed by AdExchanger, read: “We should access this API through some proxy to hide who we are.”
After EDO’s contractual relationship with iSpot ended in 2018, its access to iSpot’s data continued when it hired Nadya Teyfukova from Horizon Media, who had access to iSpot’s dashboard via her prior employer. According to court filings, Ed Rugoff, then EDO’s EVP of studio analytics and Teyfukova’s supervisor, directed her to download iSpot’s data upon discovery that her credentials still worked.
ISpot sued Teyfukova in 2021 after discovering she downloaded hundreds of reports over the course of 18 months. At that point, Rugoff directed her to delete any files with iSpot data from her EDO laptop, which she did.
In 2022, iSpot amended its suit against Teyfukova to also include EDO as a defendant.
What now?
As EDO prepares its appeal, the verdict underscores how difficult – and cutthroat – the advertising measurement business has become.
Although EDO never competed in the measurement currency space, a key distinction from iSpot, it has carved out a niche with outcomes-based measurement. ISpot, the elder of the two companies – it was founded in 2012, three years before EDO – has a long-standing reputation for providing cross-screen attribution, as highlighted by NBCU’s marketer-backed currency vendor comparison in 2022.
Video ad measurement has long been one of the TV industry’s top pain points. The need for standardization leaves little room for innovative differentiation. (There are only so many ways to count a video ad.)
Still, “measurement is supposed to be about providing truth, transparency, accountability and trust for the marketplace,” according to the media advisory iSpot released on Friday regarding the ruling.
But it may be hard for media buyers and sellers to maintain their confidence in measurement providers when those same providers apparently can’t seem to stay out of court.
