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3 October 2019

Comcast mounts Google’s greatest threat to date

Comcast is really getting its teeth into the whole ad tech minefield, lunging for the jugular this week as the world’s largest cable TV operator turned media powerhouse takes on the bigger half of the online advertising duopoly. First blood in a war of disparate titans sees Comcast accuse Google of waving privacy concerns to hinder its video ad arm FreeWheel from selling ads on YouTube – firing a warning shot to Google that it won’t stand for such anti-competitive practices where its beloved video is concerned.

While Google is no stranger to scrutiny and legal action, more recently mounting in both volume and severity, the company and its parent Alphabet have seldom seen an attack on this scale – arguably marking Google’s greatest challenge to date. Comcast has also sent out a rallying cry, calling for technology companies to pool resources together, according to Reuters sources, with the supposedly harmless aim of “discussing” Google’s stranglehold and the threat this poses to online video advertising.

Smaller entities than Comcast are typically deterred from following through on complaints against Google given their reliance on its technology and services for survival. Comcast and the wider cable industry don’t.

That said, Comcast has initiated proceedings lightly at first, likely testing the waters of Google’s retaliation, with sources saying the accusations are yet to escalate beyond closed doors of a congressional task force. Google’s only response so far is a comment stating it is cooperating fully with the latest investigations, following a spate of requests for information from the US Department of Justice regarding alleged antitrust law violations.

The tussle arrives a decade since Google first welcomed FreeWheel into its ecosystem. This was a landmark agreement at the time, allowing NBC (Comcast) and Turner (AT&T) to sell YouTube ad slots via FreeWheel’s video ad servers instead of being tied to Google’s system. It took 9 years for Google’s feathers to be sufficiently ruffled, cutting off FreeWheel’s flow into Europe no thanks to the EU’s stringent GDPR regulations. Sources now claim that Google is attempting to cut off certain data streams from FreeWheel media customers in the US – thereby reducing FreeWheel’s appeal as a Google ad tech alternative. Using the term minefield in our opening gambit now seems much more poignant.

Our interest was also drawn to this case because of Comcast’s recent embrace and resultant expansion of the addressable advertising technology Sky AdSmart which has progressed nicely since the takeover. Comcast might therefore not care too much for FreeWheel’s European YouTube expulsion, combining the clout of Sky’s AdSmart and Comcast’s new On Addressability initiative (which we believe are fundamentally the same system) in combination with Liberty Global’s in-house ad tech system. But that’s a different kettle of fish.

A Comcast statement reads, “FreeWheel would embrace a solution that allowed it to continue to meaningfully serve its clients when they publish their content on YouTube, as it had for over a decade on that platform. Unfortunately, the actions to remove or degrade FreeWheel’s capabilities on YouTube fall well short of that.”