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News Corp seizes ad tech opportunity amid revenue declines

News Corp is the latest publisher to throw its weight behind making programmatic ad sales “premium,” in an attempt to stave ad dollars from flowing to the digital advertising giants Facebook and Google, as its traditional business see revenue declines.

News Corps’ revenues dropped $45 million in the last quarter to reach $2.12 billion. CEO Robert Thomson said the company is “aggressively” moving to digital, and that includes beefing up its digital advertising. During the last quarter, digital ad revenue accounted for 27% of the company’s news segment.

The ad tech push comes at a time when Google and Facebook are under more pressure than ever to demonstrate their worth in the digital advertising space. Google this week announced a slew of concessions it’s making to brands in the aftermath of YouTube’s recent brand safety crisis.

Earlier this week, Google said it’ll partner with comScore for third party verification about its inventory. YouTube also said it won’t run advertising on channels with less than 10,000 lifetime views, a metric of video views that aggregates viewership from all videos posted by the creator. That’s in hopes of ensuring brands aren’t inadvertently supporting things like jihadist videos on YouTube.

In a fun twist of events, the fact that YouTube was running ads on inappropriate videos recently came to light, in part, through an exposé on digital advertising released by The Times, a UK-based news publication owned by News Corp.

“This is the perfect ​moment to launch an alternative to the digital platforms that have arbitraged ambiguity and compromised the integrity of advertising,” News Corp head Robert Thomson said, hinting at Google and Facebook’s recent respective digital and video snafus.

“Affinity and integrity are far too often missing in the modern marketplace,” Thomson said during the company’s recent quarterly earnings call. “A tweak to an algorithm, or a fact check here or there does not solve the basic problem. Ad agencies and their programmatic ad networks are also at fault, as they sometimes artificially aggregate audiences, and these are then plied with content of dubious provenance: the agencies win; the fabricators of the take win; and advertisers and society both lose.”

News Corp has been investing heavily in ad tech over the past few years, and acquired global digital ad platform Unruly in 2015, to help News Corp “create new premium video inventory for our News UK mastheads and other businesses, and to provide advertisers with best-in-class brand solutions across all platforms,” said News UK’s chief Rebekah Brooks.

It’s also been steadily expanding its programmatic ad sales to match its traditional advertising business across its properties. Now, the publisher is building its own programmatic ad network and plans to sell premium inventory using Unruly’s private marketplaces across News Corps entire portfolio of sites.

Unruly’s private marketplaces let marketers buy media based on a variety of different targets, including the likely emotional states of viewers. It categorizes inventory by the type of content the ad will run against and what Unruly thinks viewers will be feeling in reaction to the content. In order to do this, Unruly devised an emotion classification system, and paired that with Grapeshot’s article analysis technology, which helps Unruly determine which Websites and Web pages are likely to elicit which emotions from consumers.

Those moves can be understood in a wider digital advertising climate in which ad buyers and ad sellers alike have grown dissatisfied with the performance of digital advertising. News Corp and other publishers are looking to regain some control of their digital ad sales and wrestle away digital ad dollars that are currently being captured by the likes of Facebook and Google.

News Corp is also building out a programmatic ad offering that’ll debut later this year. This week, News Corp named New York Post CEO and publisher Jesse Angelo as head of digital advertising solutions to oversee the development of the programmatic platform “to give brands a direct way of ​targeting a large, high-quality audience of potential customers in a trusted environment,” the company said. The programmatic platform will enable marketers to buy inventory across News Corp sites and against advanced audience targets. News Corp’s next task is convince brands and marketers that its programmatic ad platform is worth more budget spend than the competitors.

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