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The Publisher Lab: Google reorganizing to focus on Bard, UK publishers sue Google, and the growth of Amazon digital advertising

The Publisher Lab: Google reorganizing to focus on Bard, UK publishers sue Google, and the growth of Amazon digital advertising

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We have another episode recap of the Publisher Lab and this week, we’re talking mostly about Google and Amazon. Google seems to be in the news a lot lately, for better or worse, and Amazon is quickly shifting from an underdog in digital advertising to a major player.

Prefer to watch the podcast? Check out the YouTube video version here.

Google shifts virtual assistant employees to work on Bard

According to CNBC, Google is restructuring management roles within its virtual assistant division to put more effort toward Bard. For example, Google Assistant’s engineering VP was recently transferred to be the lead of the Bard engineering team.

Google certainly has felt the threat of other generative AI, specifically Microsoft and OpenAI’s ChatGPT, which was released earlier this year. Google quickly followed with its own release of Bard, though it’s widely believed that ChatGPT has a leg up on Bard.

Google is dominant in two major ways that give it access to other parts of its business: search and its office suite. So many advertisers are interested in Google because of the huge base of users to serve their ads to and it has access to so many websites because publishers wanted to monetize through Google AdSense. Additionally, Google has access to a lot of user data through Google Calendar and Gmail.

However, at the end of the day, the only value Gmail holds is that user data, and Google’s display revenue is just a drop in the bucket compared to what they are making through search. Advertisers would gladly go somewhere else if you took away Google’s search ads.

The thing with Bard is that it felt very rushed. Google has been sitting on LaMDA for years and seems to have been caught unaware by ChatGPT. It seems like they are executing Bard out of fear rather than when it is the most quality it can be. It would be in Google’s best interest to regroup and consider how they can integrate Bard into everything, creating as much synergy as possible.

Google being sued for $4.2 billion by UK publishers

A new lawsuit has developed in the UK by publishers. In the lawsuit, UK publishers claim Google has given preferential treatment to its own ad products since 2014, which resulted in lesser revenue for publishers. The publishers are suing for $4.2 billion.

Google has called the lawsuit “speculative and opportunistic.”

However, it is hard to imagine that Google has never given preferential treatment to its own ad products. Google has made it really difficult to compete with the schema data and context it applies to its YouTube videos, making it hard to rank videos not on the platform. This is where you might run into antitrust issues—they’re a dominant figure in this space and then make it seemingly impossible to win out against its products.

In other lawsuit news concerning the DOJ and EU, Google has offered to restructure its ad tech business and show rival ads on YouTube. It’s possible more lawsuits will follow this one by UK publishers.

These lawsuits in the United States, however, are being fast-tracked. It appears as if we’re heading to a recession and the government will want Google to be freed up to plan its finances, as it is a major employer and the lawsuit would have effects on its budget.

Out of these lawsuits, it seems as if the one by the DOJ is most likely to make a major impact globally; if Google is required to break up its business, it would make the ad industry very different. If required, it’s likely Google will break out AdManager, separate from Google AdExchange, and the ad server itself.

Amazon swooping in with digital advertising could bring opportunities for publishers

Last year, for the first time in years, Google and Meta’s digital advertising revenue fell below 50%. This is largely due to the rise of Amazon’s digital advertising business, which held 11% of digital ad purchases in 2022. In 2021, Amazon generated $31.2 billion in revenue and in Q4 of 2022, Amazon’s ad revenue grew 19% YoY.

Part of Amazon’s success is due to the unique offerings of its SSP—it brings in new, quality advertisers from its DSP, there are no third-party fees, and Amazon has a ton of first-party data. This brings opportunities to publishers because of the huge pool of quality advertisers available within the platform and the competition it drives in regard to Google and Meta’s ad businesses, competition that will raise earnings for publishers.

However, there are a few difficulties with using Amazon for digital advertising. It offers header bidding but using it creates a dual layer, where the request is first sent through Amazon and then other demand partners, slowing down publishers’ websites and limiting revenue potential. Additionally, it can be difficult to be accepted into the Amazon Publishers Services program.

Comments or questions?

If you have a question or comment, head to PublisherLab.org and leave us a line! You can also find all of our podcast episodes, or on whatever platform you use for podcasts. Or, leave us a comment on one of our YouTube videos.

Whitney is a former journalist for numerous city-wide newspapers and online media sources and an accomplished digital and creative marketer. She has multiple years of digital publishing expertise and contributes regularly to all of Ezoic's content sources.

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