Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here.
The Cost Of Ad-Free(dom)
Streaming is getting a lot more expensive.
The average cost for major ad-free streaming services has risen nearly 25% over the past year, The Wall Street Journal reports. Case in point: Disney is hiking prices for its ad-free services again. This is its second price hike in less than a year, and it’s not the only one charging more. (Here’s looking at you, Paramount and Netflix.)
More subscriber churn is very likely. Viewers often dip in and out of streaming services to catch their favorite shows before canceling and moving on to the next one. Or they might opt for a cheaper, ad-supported offering, which is what programmers with new ad tiers (i.e., Netflix and Disney) are hoping for.
Netflix and Warner Bros. Discovery both say their subscribers on ad-supported streaming tiers generate higher average revenue per user (ARPU) than their ad-free counterparts. One reason is because streamers have a habit of discounting and subsidizing subscriptions to incentivize sign-ups.
But ARPU is a major indicator of streaming profitability, and if ads have higher ARPU, we’ll see more programmers putting a higher price tag on their ad-free services to push viewers into signing up for ads.
And if not, they can at least make more money from those pesky subscribers who insist on watching TV without ads.
Traffic Jam
Since acquiring Twitter last year, Elon Musk has made a habit of tweeting his grievances with media companies. But catty posts only go so far, and it appears Musk has found a new way to use the platform to target his enemies.
Twitter (or X, we suppose) is allegedly throttling link traffic to certain sites by introducing a delay before the sites load, The Washington Post reports.
The delay seems to only affect media outlets Musk has publicly criticized, such as The New York Times and Reuters, and Twitter’s direct competitors, such as Snap and Substack. Meta-owned social media rivals Facebook, Instagram and Threads, as well as former Twitter head Jack Dorsey’s Bluesky are also impacted.
Slower site loading speeds stifle ad revenue, because users grow frustrated and bounce to other sites before the page (and its ads) fully load.
The delays affect the “t.co” link-shortening domain. WaPo says t.co links posted on Twitter that redirect to the affected sites load about five seconds slower than other sites that use the same shortlinking service.
But not all of Twitter’s competitors are subject to throttling. Links to YouTube and Mastodon are loading as usual.
Sum It Up
Google just fired another salvo in its AI search war with Microsoft.
The company announced Tuesday that its AI-equipped Search Generative Experience (SGE) can now summarize certain articles, The Verge reports.
After users click a link to an article, a button appears at the bottom of the page that, when pressed, prompts SGE to generate a bulleted list of key points derived from the article.
Google says SGE can only summarize free content; it cannot be used for paywalled stories.
The feature is currently available only to participants in Google’s Search Labs program, and can be accessed in the Google app on iOS and Android. Google plans to bring the feature to the desktop version of its Chrome browser soon.
In addition, SGE can now display definitions or illustrations explaining a topic when users hover over certain keywords in search results.
These AI-powered features are table stakes for how search engines will work going forward, according to Google CEO Sundar Pichai.
But Wait, There’s More!
How Linda Yaccarino is trying to woo advertisers back to Twitter (fine, X). [The Drum]
Agencies weigh the pros and cons of generative AI in political advertising. [Digiday]
OpenAI tests using ChatGPT for content moderation. [Semafor]
Inside the DEF CON conference’s AI chatbot hackathon. [CNBC]
The Consumer Financial Protection Bureau plans to prohibit data brokers from selling consumer data for targeted advertising or training generative AI. [CyberScoop]
Sports Illustrated publisher The Arena Group sells a majority stake to Simplify Inventions. [Axios]
You’re Hired!
Amazon ad management software startup Teikametrics hires Ben Rey as CRO and Erik Ricard as VP of services. [release]
Acast appoints Greg Glenday as chief business officer, Ricardo Neto as VP of sales and Tiffany Ashitey as interim managing director. [release]
