Value Judgments
Google is finally striking serious AI licensing deals with publishers.
But Google won’t be paying publishers every time its AI crawls their content or, as the IAB recommends, every time that content is used by AI to respond to a user’s query.
Instead, Google is taking a new route that’s much harder to measure. Its new licensing scheme is “pay per value,” which means Google decides how valuable publisher content was for generating responses across Gemini, AI Overviews and AI Mode, Digiday reports.
Dozens of publishers have been approached about participating in a pilot program for the new licensing model. Participants get an AI earnings widget added to their Google Search Console that displays monthly AI earnings – but does not explain how these payouts were calculated.
Google only pays publishers when their content “significantly” contributes to an AI response, per several industry sources familiar with the pilot. Google says the pilot is an early-stage gauge of the best ways to reward high-quality content, but as of right now, there’s no clear metric for measuring the degree of quality.
Still, many publishers would rather be “inside Google’s licensing tent,” as Digiday puts it, rather than waiting on the sidelines.
Other publishers are less enthused, calling the system “quite black box,” and saying that the early returns have been “peanuts” when compared to their overall ad revenue.
Mr. Netflix Goes To Washington
A rising tide lifts all boats – or, in this case, streams?
Netflix, Amazon and YouTube have joined forces to lobby the government on behalf of the streaming entertainment industry, Axios reports. Called the Streaming Access and Choice Alliance, the new group is an offshoot of a trade organization of tech CEOs and senior executives called TechNet.
Streaming companies are no stranger to lobbying, as Puck reported back in August. In fact, Netflix currently outlobbies many of the entertainment industry’s biggest companies and trade unions, including the Motion Picture Association.
What’s different about this new endeavor is that it appears to be a response to recent government investigations into live sports moving to subscription streaming, at least according to Axios. This year, the FCC, the DOJ and the Senate Committee on Commerce, Science, and Transportation have pushed back against the migration of sports from free channels to paid services.
Live sports is a big revenue generator for streaming TV. Even on ad-free subscription tiers, these platforms still show ads to users during live sports content. And sports is such a moneymaker that streamers are rushing to strike multimillion-dollar licensing deals with major professional leagues before their competitors can.
But, ultimately, all the streamers are benefiting from live sports deals, even if sports fans aren’t thrilled. So it’s just smart business for rival companies to work together and convince elected officials not to call foul on these deals.
Digital Markets Balancing Act
The European Union is the butt of plenty of well-earned jokes about its consumer internet experience. (The GDPR consent pop-ups will continue until morale improves.)
However, it’s worth calling out when the EU scores a win for everyone – as appears to be the case with Apple’s new integration with third-party LLMs.
A developer sleuth by the name of “pdfu” recently spotted examples of an unreleased iOS feature that replaces Apple’s Siri assistant with a “Model Manager Services” tab for agents like ChatGPT or Claude, MacRumors reports.
Meanwhile, the new iOS 27 Apple released this week includes only one comparably shallow integration that allows Siri to call upon ChatGPT via an extension – although the responses come back in Siri’s voice and UI.
So, while none of the most interesting hypothetical updates is live, MacRumors writes, “it at least shows how extensively Apple has engineered Siri for future model interoperability.”
And Apple wouldn’t be even thinking about embedding third-party AI models that supersede Siri if not for the EU’s Digital Markets Act (DMA), which requires the biggest platforms to allow third-party software alternatives in consumer tech categories.
Google also recently changed how it displays search results in the EU to comply with the DMA. Google frames it as a degradation of its search quality (and perhaps it is). But regulators argue the changes push sponsored units down the page and create visibility for a wider range of businesses.
But Wait! There’s More!
ChatGPT has a new chatbot-native ad format, which features a click to chat rather than click to site. [Digiday]
What’s the approach of OpenAI’s VP of creative, Zach Stubenvoll? [Ad Age]
OpenAI delays its plans to go public this year, citing safety concerns around AI. [Mashable]
NFL RedZone was criticized by subscribers for introducing ads to its previously ad-free experience last football season. After promising to dial back the ads, it cut its ad load by 50% during the first week of games for this season. [Awful Announcing]
Meta removes certain invasive data-gathering prompts from its Meta AI software that a parenting blogger flagged could be used to stitch together sensitive information about a user’s family. [CNET]
The rise of AI-generated books is starting to affect the revenue of human authors. [Fortune]
You’re Hired!
Stagwell-owned agency Assembly names Liz Rutgersson as its CEO for global and North American markets and appoints Connie Chan as CEO of the APAC region. [Adweek]
TubeScience hires Brad Murphy as president of brand direct sales. [Adweek]
Method1, a media agency focused on behavioral science, appoints Jessy Magor as head of growth. [release]
Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here.
