Tim Armstrong Is Back; Botnet Makes End Run Around Ads.txt

Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here.

The Direct Approach

Tim Armstrong, former CEO of AOL and Oath, is on to the next business since leaving Verizon at the end of last year. Armstrong’s new venture, the dtx company, will invest in direct-to-consumer products. The first six investments are startups in women’s clothing, cosmetics and food and beverage, as well as a mobile service that analyzes schools and neighborhoods. The company will also run “experiences” across the country – essentially consumer events and trade festivals. “The distribution structure of social, search, YouTube and their ad formats allow these companies to put everything in their product catalog directly in front of consumers,” Armstrong says. “The payments space, though complicated now, is on the verge of getting a lot easier.” More.

Ads.txt’s Subtext

Ads.txt decreases ad fraud, but it doesn’t solve the problem. DoubleVerify identified one botnet that scraped legitimate content to make sites, which Ads.txt should prevent. But in this case the fake inventory and traffic came through certified resellers, The Wall Street Journal reports. Ads.txt brings transparency to vendors, but malicious actors with a seat at a certified intermediary could offload fake traffic without higher scrutiny. “You need to have other processes in place to sniff out the funny business,” says SpotX VP of inventory operations Nick Frizzell. More.

After The Fall Comes The Bounce

It’s not ALL bad news in digital media circles. One day after The New York Times crowed about dramatic growth in digital revenue, IAC reported strong results for its Dotdash publisher group. Revenue for the network of vertical sites grew 32% to $40.2 million in Q4, and 2018 full-year revenue was $131 million. For more, check out Dotdash CEO Neil Vogel’s recent podcast interview. Meanwhile, Business Insider parent Insider Inc. surpassed $100 million in revenue and achieved profitability in 2018, Digiday reports. And News Corp. grew digital subscriptions at The Wall Street Journal 23% in the past quarter. CEO Robert Thomson said in a company statement that revenue growth came from “the power of premium content and authenticated audiences in a fact-challenged world that craves credibility.”

Achtung, Facebook!

Germany’s antitrust authority to Facebook: Don’t combine user data from WhatsApp, Instagram and the big blue app without specific and voluntary consent. Sound familiar? Just a few weeks ago, France’s data protection authority fined Google 50 million euros for using a pre-ticked box to gather consent and for being unclear about how it uses consumer data – both major no-nos under GDPR. The ruling from Germany, the result of a three-year investigation, strikes a big blow to Facebook’s plans for integrating the backend technology underpinning its messaging services, The Guardian reports. Facebook will “no longer be allowed to force its users to agree to the practically unrestricted collection and assigning of non-Facebook data to their Facebook user accounts,” stated Andreas Mundt, president of Germany’s federal cartel office. That means Facebook will have to stop linking data collected from its tracking pixel on third-party websites without consent. Facebook has 12 months to change its data policies. What does Facebook have to say about it? Read the blog post, but here’s the gist: “We disagree with their conclusions and intend to appeal.” And what does this mean for the IAB’s consent framework? It’s not a good sign.

A Gap In The Great Firewall

Facebook is having better luck in China, which is its largest market in terms of ad revenue despite Facebook being banned in the region. Teaming up with a local Shenzen agency Meet Social, Facebook hosts meetings with prospective clients who want to reach its 2.3 billion users outside of China. Meet Social says it will generate $1 billion to $2 billion in ad sales on Facebook and Instagram this year, CEO Charles Shen tells The New York Times. Facebook, which works with seven similar resellers in the region, saw total revenue from China-based advertisers hit $5 billion in 2018, 10% of total sales, enough to rank it as the seventh-biggest internet company in the country, according to Pivotal Research. More.

But Wait, There’s More!