|News Round Up
If legitimate interest is disallowed as a provision for targeted advertising by the EU’s ePrivacy law, which expands on GDPR regulations, it could cause a 70% reduction in display ad revenue in Europe and a 33% cut in digital ad budgets, according to a report from Citi. The change could “eviscerate Facebook and Google, at least under their current business model,” writes Axios’ Steve LeVine. The final law may be watered down by industry lobbyists, “but if this does not happen it could have a devastating impact on the online advertising industry and future innovation as consent becomes the be all and end all," the report says. More.
Instagram is testing a payments feature allowing some users to shop or make payments directly on the platform with a select group of partners. So far, restaurant reservation app Resy has integrated native payments on Instagram, TechCrunch reports, but the photo platform is also putting in place ways to buy things like movie tickets and apparel. Removing the friction of having to link users out of the app to make a purchase could bring more advertisers to the platform, and also opens a wealth of commerce and consumer data where Facebook has trailed Google and, especially, Amazon. Snapchat also just launched a native payments and Snap to Store measurement feature in February, so Instagram had to have one too. More.
When Less Is More
The prevailing wisdom is venture capital and private funding for digital media startups have dried up since the heady rounds of early trendsetters like BuzzFeed, Vice, Mashable and Refinery29. But that isn’t quite true. Axios raised $20 million in November, while just last month theSkimm and the Athletic, a subscription sports news site, raised $12 million and $20 million respectively. The Outline, a news and culture media company, just closed a $5.2 million round where the publisher deliberately took less money than was on the table, reports The Wall Street Journal. “One of the reasons why we didn’t raise $25 million, or get as much money as possible, is we really want to create a sane business that’s scalable,” says Joshua Topolsky, founder and CEO and former of editor of Bloomberg. More.
Pandora reported Q1 earnings, with revenue up 12% year-over-year to $319 million. Advertising contributed $215 million and subscriptions brought $105 million. MAUs, however, were down 4% to 72 million, showing the company still has work to do to grow its audience. AdsWizz, the digital audio ad tech company Pandora acquired in March [AdExchanger coverage] will not only bolster Pandora’s own ad tech capabilities, but build a marketplace that will grow the entire digital audio ecosystem, CEO Roger Lynch told investors on the call. Lynch isn’t concerned about competitors leaving AdsWizz under its Pandora ownership. “I think there’s benefit in those publishers staying because AdsWizz has the largest platform, and as we start to put our inventory in, they have by far the largest amount of digital audio inventory to monetize,” he said. “When you’re creating a marketplace, buyers will want to be where the inventory is and Adswizz will have that inventory.” Read the release.
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