US wireless carriers Verizon and AT&T are the latest advertisers to boycott Google’s YouTube over concerns that not enough is done to prevent ad placement next to content promoting terrorism and hate.
The telecom giants released statements on Wednesday (March 22) issuing their intent to halt advertising on YouTube and Google’s display network until receiving assurances that their ads will not be played ahead of objectionable content.
The action comes in spite of a public apology on Tuesday (March 21) by Google’s EMEA president, Matt Brittin, who pledged to review Google’s ad placement policies, categorisations of inflammatory content and advertiser controls.
Joining the pack
Verizon and AT&T represent the third and fourth largest advertisers in the States according to Kantar Media and join a growing list of advertisers in revolt. Havas - the world’s sixth largest media agency - pulled involvement for its entire UK client base, which includes the likes of O2, Royal Mail, BBC, Dominos and Hyundai-Kia.
With its search channel maturing, YouTube has served as a driver of growth for Google, reaping some $5.58 billion for in global net ad revenue for Google last year, but analysts warn that the current advertiser crisis could see the search giant face short-term revenue loss.
In the long term, however, Jackdaw Research’s Jan Dawson believes there’s a danger that companies will lose faith in the automated placement of ads, hurting the wider programmatic industry and its members.
"The bigger risk is this seems to be a backlash against programmatic advertising in general," said Dawson, “There's this worry that you no longer have control over where ads appear."
Moral high ground?
As noted by TechCrunch, however, the two carriers’ motives might not be just about taking the moral high ground, with both companies focused and financially invested in building their ad tech businesses.
“That ambition underpins Verizon’s desire to acquire Yahoo (and why it spent $4.4 billion purchasing AOL) and AT&T’s proposed acquisition of Time Warner. This means both companies potentially stand to benefit if Google loses advertising market share,” reported TechCrunch.
Meanwhile, a report by Reuters raised the question of whether the advertisers pulling their spend from YouTube are likely to reallocate it elsewhere, citing a quote from Brian Wieser, an analyst at Pivotal Research, in response.
“If you know all of your competitors are reducing their spending too, then you don’t need to spend more,” he said.