Ad Targeting In The State Of The Union; Why Gaming Is The New Beating Heart Of Subscription Packages

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Not Kidding Around 

During the State of the Union address on Tuesday, President Biden called on lawmakers to get cracking on legislation that bans ads targeted at kids.

“It’s time to ban targeted advertising to children, [and to] demand tech companies stop collecting personal data on our children,” Biden said. He also gave a shout-out to Facebook whistleblower Frances Haugen (who was in attendance) for raising awareness of the “national experiment” social media platforms conduct on children for profit.

Haugen disclosed documents a few months ago revealing internal Meta (then just Facebook) research acknowledging that usage of its apps cause mental health harm to young users, particularly young girls.

For that and other sins, reining in Big Tech is one of the rare bipartisan issues supported by lawmakers on both sides of the aisle.

But it’s still not easy to land a meaningful blow. Section 230 of the Communications Decency Act shields open distribution platforms from liability for content posted by users. The FTC is also grappling with what it can and can’t do to regulate “surveillance advertising.”

The irony is, Big Tech will be more than happy if eventual data privacy legislation sticks to regulating ads that target children. Other bills in the mix already, such as the Banning Surveillance Advertising Act, aim to stop targeting and tracking altogether.

Gaming The System

Netflix acquired Night School Studio, its first game studio, in September 2021. Yesterday, Netflix dropped $72 million for the Finnish mobile developer Next Games, the studio behind game franchises for hit shows, like “Stranger Things” and “The Walking Dead.” Next Games made $30 million in 2020, more than 95% from in-game purchases, per the release.

That revenue stream goes away now, though, because Netflix’s pitch is for games to come free with a subscription.

Meanwhile, Amazon Luna, the $6-per-month cloud gaming service, launched to US customers. Through a “unique offer,” Prime members can access free gaming titles during the month of March. Wow, wonder how they landed that partnership.

Speaking of actual partnerships, Apple Arcade and Google Play Pass (their respective gaming services, which both cost $5 per month) each recently announced subscription access for Verizon customers. Apple also bundles Arcade, which means it becomes more affordable as subscribers add Apple TV+, Apple Music, Apple News, iCloud data packages, etc.

But don’t miss Microsoft. Xbox data helps underpin Microsoft’s advertising audience graph. Also, one surprisingly common reason Bing loyalists (seriously) say they use Microsoft’s search engine is that it distributes credit toward Xbox’s Game Pass subscription.

Pub Crawl

Publishers are exploring new business models, including subscriptions – but revenue diversification raises questions about talent retention.

Big-name publishers used to have more power over writers. Individuals couldn’t run their own ad sales, publish a magazine or easily get their healthcare, etc.

But with a Substack and enough followers on Twitter and LinkedIn, a publishing business can spring up in an afternoon, writes Brian Morrissey, the former Digiday editor-in-chief who now covers the publishing business in a Substack called The Rebooting

The trend isn’t new – it’s what Shopify did for individual merchants. 

The New York Times, as the biggest brand name in news, sits at the nexus of these changes. It still delivers cachet to writers and tries to retain that value. Reporters can start a podcast or their own newsletter – although those products must live within The Times’s subscription offering. But writers need permission to land a book deal or to do outside consulting work, even if it isn’t directly competitive, Insider reports.

It doesn’t always pan out. One former Times staffer recently sought approval for an outside project, which had been paying them more than their NYT salary – and permission was denied.

“This isn’t a ridiculous millennial crybaby thing,” says one former Times staffer. “This is being reasonable and responsible about finances.”

But Wait, There’s More!

The invasion of Ukraine exposes the tricky balancing act of brand responsibility in advertising. [Digiday]

Disney opens a new data platform and programmatic deals with The Trade Desk. [Ad Age]

PMG and KERV International partner to get shoppable video onto TikTok. [release]

While ad tech acquires game developers, the developers buy up music rights. [The Verge]

Adam Singer: Key questions to ask potential marketing/analytics hires. [blog]

Goodway Group acquires the growth marketing agency Tuff. [release]

You’re Hired!

Previous BuzzFeed and BlackRock marketing lead Frank Cooper III joins Visa as global CMO. [Adweek]

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