Streaming On Sale
When Amazon first defaulted Prime Video to an ad-supported model, billions of impressions flooded the market and drove down overall streaming CPMs.
Now, one year later, Amazon is still lowering rates across the board as other programmers scramble to compete with the digital behemoth.
Prime Video impressions cost about $35 out of the gate last year, and now cost closer to $28, according to Emarketer. But the dynamic is deliberate for Amazon. Netflix is less pleased that its CPMs dropped from $42 to about $31 in the same time, while Disney+ ad costs went from $39 to $28.
“It’s clear Amazon is [using] its humungous scale and ecommerce infrastructure to disrupt the streaming video landscape,” Jennifer Kohl, chief media officer at VML, tells Digiday.
Streaming ad prices should continue to fall as ad inventory hits the market. Again, Amazon likes the price-depressing dynamic. Prime Video will increase its ad exposures this year. Other programmers are hamstrung about increasing ad impressions per hour, which started low to pacify subscribers. Thus Amazon can swamp even big-name streaming platforms with its growing supply.
Looks like the more TV inventory spawns, the cheaper it’ll become.
Let’s Be Upfront
In the past year alone, a changing of the guard took place among TV ad sales leaders. The decades-long leaders at Fox, A+E and Warner Bros. Discovery all left, Ad Age reports. Relatedly, 2024 was the first year that TV upfront commitments to digital video surpassed prime time linear, according to Emarketer.
“So [the TV ad chief] roles are increasingly as much about data and technology as they are about IP and premium content,” says Jeff Collins, a Viant veteran who Fox promoted to president of ad sales, marketing and partnerships last year.
Ad tech disdains the datalessness of the upfronts.
The Trade Desk CEO Jeff Green said on an earnings report earlier this month that it’s building a deal management product – a “forward market” – so buyers and sellers can commit future budgets. The product “will change the ecosystem and eventually upgrade the upfronts,” he said.
Programmers and streamers want to make buying ads with them more like how advertisers set up campaigns on YouTube, writes Ad Age.
What advertisers bid for even primo or tentpole TV content on YouTube is peanuts compared to TV programmers’ upfront rates.
The Googleverse
Big Tech giants with nation-state levels of cash enjoy many advantages. But there are real disadvantages, too.
The Information details how Google’s AI investments have entangled the company as individual leaders jump around and business units grow and recede.
DeepMind, Google’s internal research unit, prefers to ship quickly, like ChatGPT’s update cycle. The Google Cloud group prefers “reliable and long-lasting” services and new features requested by important customers.
The Pixel phone was originally going to have a built-in AI feature dubbed Pixie, which would look things up and complete tasks across different apps, according to The Information. It was folded into Gemini to avoid operating two separate chatbot AIs. But Gemini only works on Google apps like Gmail or Calendar, so the Pixie tech lost its functionality.
The big example is Google Search. ChatGPT or Perplexity can try lots of new things with their nascent search engine products.
Google must play it safe, to start at least, with an AI tab in its traditional search experience and rollouts of generative AI responses within the search feed.
Last fall, though, the Google Gemini team moved from the unit overseeing search to Google DeepMind – where the AI tech may be shielded from the bureaucracy of Google’s more mature business units.
But Wait! There’s More
Microsoft has started canceling leases for its AI data centers. [Bloomberg]
All 50 states have now introduced some kind of “right to repair” legislation, intended to make fixing mechanical equipment easier for consumers. [404 Media]
TikTok (with Douyin) became the first app to reach $6 billion in annual consumer spending. [TechCrunch]
You’re Hired
Nielsen hires Jessica Holscott as CFO. [Variety]
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