In this special Conversations episode of Media Voices, Chris is joined by co-founder and CEO of Permutive Joe Root, and Dennis Publishing’s Head of Programmatic and Audience Data Alex Kirby. They discuss the realities of user privacy in 2019, whether publishers can turn trends to their advantage, and the tech solutions that add value to the entire ecosystem, and not just the vendors.

Chris: Welcome to this very special episode of Media Voices, talking about privacy, publishers, and rebuilding ad tech. Over the last few years, the advertising and publishing industries have been on something of a crusade to reinvent ad tech, spurred by everything from breaks in the value chain, changing publisher priorities, the availability of new tech solutions, and far more. There’s a sense that ad tech is mid-transition to a more mature form; one that’s more equitable to all parties involved. At the same time, high profile instances of data misuse mean that user privacy is riding high on the industry’s agendas.

So to discuss privacy, publishers and rebuilding ad tech, I’m joined by two absolutely fantastic guests, who I’ll ask to introduce themselves now.

Alex: Thanks. My name’s Alex Kirby. I head up the programmatic and audience data teams at Dennis Publishing. Dennis Publishing is a multi-brand digital and print publisher based in the UK, working across automotive, technology, lifestyle, and current affairs brands.

Joe: Hey I’m Joe, one of the co-founders and CEO of Permutive. Permutive is a publisher-focused data management platform. We started back in 2014 really helping publishers to build a privacy compliant alternative for data on the web.

Chris: Joe we should start with you then, and start with what is potentially the biggest question that’s going to get asked on this session. Why does ad tech need rebuilding then? What has led to the point now where people are having that conversation?

Joe: So I think really we see two macro trends in market which have really brought privacy to the front, not just in Europe but now globally as well.

So the first and the unavoidable force last year was GDPR, which obviously was front of everyone’s lips. Really a backlash from government against the overstepping of a number of industries when it came to privacy. In particular over the past few months, what we’ve seen is that focus moved towards ad tech, with ICO now investigating OpenRTB, we’re seeing programmatic advertising really coming under scrutiny from government bodies and regulators.

The second trend which we’ve seen in market has been that actually, not just when the largest government body in the world says you need to respect privacy, but more importantly when actually the largest tech company in the world says you need to respect privacy, there can be some very immediate ramifications.

And the second macro trend which we’ve seen has been that effectively Apple have gone to war with Google over use of privacy, and the side effect of that – or I suppose the collateral damage in that – has been what is known as the third party cookie.

And really those two macro trends have put privacy at the fore, and I think have exposed that ad tech has overstepped the mark in a number of ways. And now both the technology is failing, but also there are legal ramifications to it too.

Chris: That’s a very emotive language there. When you say that Apple has gone to war with Google then, could you expand on that, and explain what you mean, and what the ramifications will be?

Joe: Yeah of course. So I suppose at a very high level over the past five to 10 years, we’ve seen Apple pivot towards almost a privacy-as-a-service company. Effectively the promise Apple has made to its users is that actually if you use an Apple device, we’re going to ensure that your privacy is respected.

And I think you see signs of that when you look at their CES billboard from last year which was ‘What happens on your iPhone stays on your iPhone’. Effectively Apple has said, ‘Hey, we are going to put the user’s privacy at the forefront, and actually the two companies who we really see as violating user’s privacy are one, Google, and two, Facebook’. And in particular in going after third party cookie, what Apple are taking aim at is primarily Google’s business, but also will have huge ramifications on Facebook too.

Chris: Alex from a publisher perspective then, what is happening to publishers who are almost caught in the wash from that ongoing conflict between platforms?

Alex: I think with the rise of programmatic, and the compression and the devaluation of inventory and media spend, I think this is just another thing that has compounded that degradation of value.

What it’s allowed us to do is to really look at our business models, and see what opportunities there are to really put the user at the forefront. That’s what the industry as a whole it has really missed out on, and it’s what the recent legislations – though painful they may have been to implement the policies – it’s allowed us to really look at what our users want, how we can put privacy and those users at the forefront and build products around that.

I think that we will have to work a way to live in this new world. None of us can really afford to have our businesses crumble. Not just an industry, as users who want to be able to access content, access news, we need to be able to work in a privacy-compliant way that suits all parties.

But if we look at how many players there are in the market, exactly what those players are doing, we will see a light being shone on some nefarious practices. And I think that if you are not getting your act together with what you’re doing, you potentially might have some real issues going forward.

Chris: It’s bizarre. Every time I talk to a publisher, everyone’s talking about transparency, exactly about that, about shining a light on some of these players who might not be necessarily adding anything, but who are these people?! I get the impression that it’s just one or two people who have snuck their tech somewhere into the value chain! They must be quaking at this point!

Alex: Well yeah. One of the real issues that we have is, it’s quite difficult to sometimes identify those players. I mean we talk a lot about transparency, and at Dennis we are definitely trying to be as transparent to our users about exactly what we’re doing, who are selling to, how we create our audiences, all of those things.

But we don’t necessarily always know exactly who’s buying. We don’t know all of the technology that gets added in through that big chain. And so what this again has allowed us to do is to really try and delve into what’s going on.

I think there will be more companies that will come along, and there are already projects going on in the industry to really try and understand exactly what’s going on, as we shine a light under that hood, as we say. But it’s not really a sustainable situation to carry on as it is.

Chris: No, certainly. Is it fair to say that the most recent changes have been almost forced upon the industry, both by legislation and by the fact that people are recognising that their data potentially has more value to publishers than they’ve realised in the past?

Joe: So yeah certainly from our perspective, I think there have been a couple of things at play which have allowed the current ecosystem to develop in its current form. One of those which is really clear is that OpenRTB protocol, and to Alex’s point just now, effectively it’s really hard to know who is actually listening to and collecting all of this data, and it’s pushing things to an extreme.

And I don’t think that it is publishers who have ever gone out and violated user’s privacy. I think it is the rest of the ad tech ecosystem which has really overstepped that mark. And I think what GDPR has done is, it’s this forcing function for us to look at the ecosystem and say, hey who should and shouldn’t be a part of this, and who has overstepped the mark.

When we look at players who have done this in particular, you look at the third party data providers. But more broadly as a whole right you’ve got an ad tech industry which on the one hand has aggregated publishers and their inventory, and on the other hand it’s aggregated users and their data.

And I think what is coming to light is actually, that isn’t a fair practice. And GDPR is just this fantastic forcing function to re-evaluate.

Chris: That sounds fantastic then. And then as a result of all that, it’s your contention that publishers can really benefit from that. I just wondered if you could explain how they can go about doing that?

Joe: So I suppose very high level, we see third party data in the US is a 19 billion dollar a year industry, somewhere between 10 and 25 cents on every dollar in programmatic is spent on data. Data is this enormous industry. But that data is fundamentally underpinned by publishers. It is publishers which give birth to that data. It is the models which are built on top of them.

And actually for a long time what has happened is, publisher’s data has been aggregated by these third parties and then sold on across the web. And all of a sudden that doesn’t work anymore. When Apple killed the third party cookie, they effectively turned the lights off for half of the Internet.

For most publishers right now, between 30 and 40 percent of their users will be on devices which are killing third party cookies. That is a huge portion of the web which is invisible. And actually as GDPR kicks in, as we see other browsers forced to block third party cookies, that number is only set to grow.

So off the back of that actually, what you’re left with is a world in which publishers are the only ones with the vehicle and the technical ability to process a user’s data, and provide data to an ecosystem which is entirely dependent upon it.

So we see this as a huge opportunity. In the US alone it’s a 19 billion dollar opportunity, globally much bigger. And I think for us, we really see that publishers have this chance to reassert themselves in the ecosystem because of privacy.

Chris: That’s a huge figure. That’s one of those figures it’s almost too big to get your head around. So Alex, Dennis has a ridiculously wide portfolio of titles, and huge audience numbers who you could potentially use their data in a more effective way that actually respects them. But to what extent do you think publishers are going to struggle to lead that charge to reform?

Alex: We’re in a bit of a bind, because publishers have the will to reform, but not necessarily the resources, and ad tech companies have the resources but not necessarily the will, unless you’re Permutive and, rather than having an existing business model you need to amend, you build it from the ground up, and I think that’s why Permutive have been able to do what they can, and get traction in the industry that they are.

It’s definitely possible, and I think there are some really good examples in the industry of publishers pushing ad tech forward. It tends to be though that you see that when you have publishers working together through alliances.

Actually we are part of the Pangaea Alliance, and last year we built a prototype yield management inventory management system where we’ve API-ed all the data from all of our SSP partners. We were able to do that because we got funding through Pangaea, and through various other sources, because there’s quite significant amount of investment that needs to go into that.

In the end, we built a working prototype and we didn’t have the resources to be able to take it forward – it might be something we look at in the future – but this was only possible because we worked with other partners.

And if you look at for example what’s going on with Ozone and the technology that they’re building, you’ve got four of the biggest news brands in the UK coming together, building ad tech for publishers.

What we will see is more publishers trying to do things like this. And I think one of the big trends we’re seeing generally is publishers really recognising that our competitors are not who they used to be anymore.

Go back five, six years ago, you wouldn’t have necessarily had lots of publishers working in a room together to solve a common problem because we were all trying to fight each other for media spend. Now we’re trying to fight Google and Facebook for media spend, even though they’re also our partners, which sometimes causes some difficulties! Our competitors not who they are.

What we do have is also some fantastic media bodies and advocacy groups. So we work quite closely with the AOP, we bring them issues and a lot of the time the issues that we face are similar to other media owners. So we’re able to work with them to push forward potential solutions. But they need to have the scale and the backing to be able to do that.

Publishers are in the unique position that because we have the end relationship with the user, we can really understand what that user needs. And so we can take that to various different bodies and to other publishers and try and solve problems, but expecting that publishers are able to really push this forward I think is potentially a little bit unfair on us, considering as well we’re the ones who have been massively squeezed by all these changes in the first place.

Chris: In fact you said something before that sounded almost like a Sphinx’s riddle. One of them’s got the resources to do it but not necessarily the will, and the other’s got the will but not necessarily the resources. But do you think there’s ever going to be a will to work together with the wider ad tech industry and publishers to sort this out, is that ongoing or is that something that’s effectively never going to happen?

Alex: I think there’s a huge will. Where issues will come about is if you have a certain ad tech company that has a vested interest in keeping things the way that they are because that’s what their business is sustained on. Ultimately those business models are going to either be illegal or we will all face up to the fact that we don’t want to be doing them anymore.

But I think that you’re always going to have, in any industry you’re always going to have people that try and play the game a little bit. It’s a really good thing that this happened because advertising online generally has been far less regulated than other types of advertising, and it’s necessary that that we – just to say it again – shine a light on exactly what’s going on and try and clean it up a little bit.

But you will always have companies that try and maintain the status quo because that’s what works for them.

Chris: Yeah you’re up against human nature at that point, you’re not even up against ad tech companies, people see an opportunity and they go, ‘It’s kind of on the boarders of legal, maybe we can sort of try and exploit that!’

Alex: You’d like to think people will do the right thing but a lot of time you need the legal side of things to enforce that.

Chris: Absolutely. Just to go back to the question of resources then, when you look at the publishing landscape and you look at what publishers are trying to do, whether through alliances or through actually talking direct and renegotiating with ad tech companies, what’s the opportunity there for publishers to actually take the reigns, and from your perspective, how do you think they’re going to be able to do that?

Joe: Yeah I really empathise with what Alex said. Right now it feels like all the pressure is on publishers to go and do this, right? And I would argue that right now from our experience certainly in going to the buy side, that awareness and the knowledge around privacy and its ramifications is startlingly low.

So if you look at the vested interest of ad tech, if you take the DSPs or the third party data providers, right now when they speak to agencies, they talk to agencies if these problems aren’t problems for them. They’ve found ways around them, they found ways around the third party cookie. They have a consistent single I.D. All these different phrases pop up, all of which obscure the fact that they just don’t work.

Agencies aren’t aware of this because ad tech vendors say, ‘Hey we do work. It’s not a problem for us.’ But actually we see it from the opposite side, where now because we sit across so many publishers, we see that, hey most DSPs and third party data providers are only seeing 30 or 40 percent of the Internet. It’s actually staggering, but agencies aren’t aware of it. So I really feel like actually a lot of the work needs to happen within the agencies.

The IAB is in a really strong position to start raising awareness of it, but also really surprised for example the IAB has an audience taxonomy. When we spoke to them, actually publishers are not engaged with that piece of work. So it feels like there are these areas where actually publishers aren’t being brought in where they should be.

And then on the other side we have a load of ad tech vendors who are starting to obscure the truth, and I think those two things make it really hard for publishers, and certainly from our perspective, we want to help champion the voice of publishers. But I think also those trade bodies, the IAB in particular, can really help lead on this.

Chris: There’s so much to unpack there, that’s almost a podcast in its own right. So to start with privacy then, why is that awareness of privacy issues so low considering that there have been so many high profile issues around privacy and data breaches lately?

Joe: So the first and very real impact of privacy has been actually via Apple, not via the GDPR. But I think what we’re seeing is GDPR taking a while to kick in, right.

So you look at the ICO investigating OpenRTB, it’s actually been twelve, 13 months before they’ve had a chance to do this properly. And in that case it’s been very well championed by people like Johnny Ryan over at Brave and a few others, but that is taking a while to build up. Once that kicks in, that becomes unavoidable.

But in the meantime actually, it has been Apple and their charge in killing the third party cookie which has had the most impact on privacy. When Apple kill the third party cookie, they turn the lights off for half of the Internet. You’ve then seen Firefox follow suit, and you’ve seen others come in around this.

So privacy is here, but there are players who it really impacts their business, and it’s in their interests to obscure that from being widely known or acknowledged.

Chris: I suppose to play devil’s advocate here on behalf of Apple or Firefox, which I didn’t think I’d ever say, is that drive towards privacy not inherently a good thing for users?

Joe: Oh 100 percent. I think the drive towards privacy is super beneficial to the user, and it is correct. Effectively, ad tech has said, ‘Hey, without any regulation we’re just going to go completely wild’. And the net impact of that for a user is, your privacy is violated at enormous scale.

OpenRTB has to be one of the largest data breaches we’ve ever seen. And for the user it is enormously beneficial. I think for the publisher, the benefit to them is because they have that relationship with the user, actually they can have this conversation around privacy, and they can approach things in privacy compliant way.

So I think on the one hand, for the user, enormously beneficial. On the other hand for the publisher, actually it just increases the value of that relationship several orders of magnitude.

Chris: So Alex it sounds like that’s actually something that the industry has known for almost as long as digital publishing has existed, that they do have that direct relationship with the audience. But it feels like it’s only been since GDPR potentially that people have made that a real selling point when they talk about their ad capabilities, and even the ability to monetize the audience through direct reader revenue.

So from your perspective is that something that almost publishers took their eye off the ball from it, or do you think it was just eclipsed by opportunities around ad tech?

Alex: We lost it for a little bit as an industry, and I think it’s primarily because we were all chasing scale. Bigger was better for so many years. And because we were really, even if we look at – I mean we don’t do it but you know – clickbaity articles and desperately trying to drive impressions, there’s no quality to it, but people just wanted to be able to to serve large campaigns, and do it pretty cheaply. That was the requirements, and so that was how we had to respond to it.

And what’s happening now is recognizing that a little bit of data that you really know about is far better than lots of data that you don’t. And really being able to understand exactly what our users want.

As a multi-brand publisher, what our users want on a site like The Week is very different from a site like Expert Reviews, and so for us it’s about really trying to understand the nuances of those audiences and building products that that work for them.

What we’re trying to do, to follow on from what Joe said, is to really purvey ourselves as a quality source of data. I think we are very transparent with our clients about exactly where we get data from, the. methodology of creating those audiences, recency frequency windows, any of that different information, and so we can position ourselves in the market as a trusted source of, in many instances, sometimes still scalable data.

What will take that to the next level is to see whether or not we can merge with other publishers. So the the ad tech companies were aggregating publisher data and selling it on, so how much more valuable would it be if we worked with other publishers to do that, and to see where that goes.

There’s lots of opportunities to come. But working out exactly what’s the best thing to focus on for now is probably our immediate challenge.

Chris: I know I shouldn’t if I can’t help picturing those negotiations between publishers around alliances as being sort of tense Cold War negotiations conducted by one of those Dr. Strangelove tables. Just any false move might tear the alliance apart, and I know that’s not the case because I’ve spoken to people who work at Pangaea and Ozone and everything; it sounds like it’s actually quite rosy. But it’s bizarre that publishers are now in this position where they are aligned in the face of ad tech.

Alex: Yeah definitely felt strange initially, but then you realise that you have – it sounds cheesy – but far more in more in common than you do that divides you.

And as we say I find it like therapy, I swear. You sit in a room with people, especially going back five or six years ago, I was working on programmatic on my own, and if I have an issue, I didn’t have anyone I could ask about it. I would go to these meetings and I’d be like, ‘Does this happen to you too? How are you dealing with this?’

Have a glass of wine and it all kind of comes out, and you realise that not only are you facing the same issues, you’re struggling with the same issues, but you’ve often got the same solutions, or you share solutions, and it’s all for the good. I think there are lots of opportunities about that, and it’s really exciting actually. It’s definitely different, but it’s an exciting time.

Chris: Joining up that support group!

Alex: Pretty much, Publisher’s Anonymous, we’ll call it!

Chris: So what trends around, I suppose ad tech more generally, will publishers be able to take advantage of over the next few years, not just in the short term, but looking forward? Not just talking about that direct relationship with audiences, but what new developments in tech are enabling publishers to really make the most of the data that they have?

Joe: Yeah so I think as the macro thing we are most excited by in ad tech and technology more generally right now is that actually there is an opportunity to rebuild programmatic and OpenRTB in a way which doesn’t undermine and undervalue the publisher.

The first generation of programmatic effectively pushed publishers to the bottom, and forced CPMs down. And actually now that you’re removing the user I.D. from OpenRTB, there is this opportunity to rebuild programmatic in a way which is one, privacy compliant but two, brings publishers back up to the top in that ecosystem. And I think that’s enormously exciting.

Programmatic to me has been probably the most damaging force for publishers and publisher CPM. And then off the back of it the question is, how do you go and build a programmatic ecosystem which actually respects that user privacy?

And the thing which we’re really excited by a company is what we talk about is edge computing. If you look at Apple, what happens on your iPhone stays on your iPhone. Apple actually pivoted to an edge computing company around 10 years ago when they went after privacy, and what edge computing is, is effectively this notion that you process data on the user’s device rather than centralizing in the cloud.

And it has been that centralization in the cloud which has caused all of these breaches of privacy and OpenRTB, and in that programmatic ecosystem. And actually we think rebuilding ad tech on edge computing enables you to build this privacy compliant version which one, gives user control of the data, and two, actually enables publishers to have a programmatic ecosystem which works for them.

Chris: I’m glad you explained what edge computing was; I had to look it up before. It’s one of those terms that you hear at conferences, and you smile and nod like you know, and then you immediately Google it in your hand under the table!

So I wonder if you could expand on the issue around cloud computing then, and how that’s really enabled these data breaches, and ultimately has negatively impacted privacy, and I suppose ultimately, trust.

Joe: Yes. So I think actually the OpenRTB protocol is possibly the nicest illustration of the problem of the cloud. So you look at the OpenRTB protocol when an ad or a bid request is sent out, that is sent into the cloud. It has a user I.D. attached to it and a load of data. Now that data hits the cloud, and downstream there are 2000 people who are all listening and watching all the auctions, and hoovering up all of this data. Now you the user has no idea who these people are. If the publisher isn’t even aware, the user has no chance at all! And the problem with cloud computing is, once it hits the cloud, you have no idea where it goes next.

So really that is the problem which is created by cloud computing, and actually edge computing in the inverse of that tries to minimize the amount of data which goes to the cloud. It tries to keep as much of that data on the user’s device where the user can control that data. And it tries to eliminate the need to send I.D.s into the cloud. So we don’t want to send an I.D. describing someone, because another party downstream will hoover that up and build a picture of you as you move across the web.

Chris: And I suppose that’s actually one of the things that you hear the public talking about most of all. They might not necessarily be aware of the practicalities of how their data is used, but they’re very aware that it is being used in some quite unethical ways to target them with advertising, or the thing you always hear is that ads chase them around the web. Now that’s not necessarily a bad thing, unless it’s for a product you’ve already bought. But people seem to find it quite creepy even though that’s the ultimate in relevant advertising.

Joe: I think I actually had this experience yesterday on a Dennis site as I’ve been researching one of these smart watches, which one to buy, and Expert Reviews knew about this well before the actual manufacturer which ended up retargeting me ever knew about it, and actually in these instances, publishers have a tonne of data upfront.

It is natural that when I’m in that Dennis environment that I get targeted for advertising which is relevant to what I’m doing with them. I don’t think that is considered creepy, it is just better contextual, right? But I think where ad tech really starts to overstep the mark, some people that sits in retargeting.

But I think for everyone in general, that actually creeps into whether third party data providers have no relationship with you whatsoever, and are hoovering up all this data. So I think there are stages; people have different levels of comfort. I think Apple have drawn the line at, ‘Hey, we will let the publisher personalize and respond to the user, but beyond that we don’t believe it is right for anyone else.’

Alex: I think to go back to your point on the creepiness, and we’ve all probably experienced it. I think the one that really always freaks me out is when I’ve been talking about something, and then I’ll see an ad for it later, like how do they know? Even though they’re listening, that’s how they know! I think what we’re seeing is users, definitely a lot of people are becoming far more aware of how this all works.

And I think that creepiness comes because they don’t really understand it. So how does the computer know what I want? But if we are able to explain that to people, and what you’ll find is with the consent management platforms and the ability to choose…some people won’t care. I know when I go online, sometimes I just want to find out how to, I’ve just moved house, I’ve got a garden, I’m doing a lot of ‘How do I plant this thing,’ and sometimes I just want to find that out. I don’t really care, like I’m not interested.

However as a user, I might be really interested about where I get my news from, because that’s something I do care about. People have got to have the choice, they’ve got to have the choice to make a decision: how much are they engaged in what their data is doing, and how much do they care about their own privacy?

If people recognised that a lot of the free internet, if we call it that, has been powered by this, and that’s the value exchange, I think what we’ve missed or what we’ve dropped the ball on is explaining that value exchange, and making sure that value exchange is fair.

If you go back to how it was 20, 30 years ago, the amount of money and resources that companies would spend just to get an idea of what people wanted to buy, you remember how much stuff used to come through your door and things like that, nowadays we’re able to get that all online, and we are not giving the right value exchange back to the user.

If that value exchange is fair, users can make their own decisions as to how much they want to engage with it, and how much they want to react to it.

Chris: So from Dennis’s perspective then, the different sites that you have have very different audiences. So to what extent is it possible to negotiate a relationship with one audience who might be coming to a car site for instance, one of your automotive sites, versus something that’s slightly more lower end of the consumer tech spectrum?

Alex: So we have slightly different messaging across the brands to match the editorial tone of those individual brands. It’s not a Dennis brand but my favourite is The Daily Mash which has something along the lines of, ‘This is the world we live in now, click it’ as the consent management platform!

And again it’s really important for us to understand the nature of how our users use those websites. Some sites we have really regularly recurring audiences and they’re very happy to give us our data because they trust us, and they understand what that value exchange is.

Potentially some of the more consumer sites, someone might be driven by search, they might come they might look at one or two page reviews, and they don’t necessarily return until they’re looking to buy a different product.

So we can’t necessarily take the same approach. It has to be different, and it has to be a strategy based on the brand and the audience itself.

Chris: I suppose then to play devil’s advocate again, how much of this is putting the onus on the user, on the audience to actually look into this, and what some of the practical solutions to getting that buy-in from an audience who, as you said, don’t necessarily understand what has led to the free internet having reached this point?

Alex: One of the things that we’re doing, and it works for some brands not for others, but one of the things that we’re looking at is metering and paywall solutions. So after a certain amount of page views, please give us your email address, subscribe to our newsletter, allow us to…I don’t need to use the expression ‘profile you’ but it comes to mind…just to have a better understanding as to who that user is.

I think that we will start to see a lot more of this, but it works when you have a trusted relationship with a particular brand as a user. It’s not going to be something that will work for every kind of business model.

Chris: So Joe then, what are some other solutions then to actually building up that trusted relationship?

Joe: What we’re starting to see is Apple are in many ways defining what a good relationship looks like in the here and now.

So Apple have come in with almost a formal specification for what a good relationship and privacy looks like, and under their very formal specification if a user visits your website, then in that sense you have the relationship with the user, and the right to process their data in the context of their interactions with you. And we as a company very much subscribe to that philosophy.

I think the second piece is that the GDPR is also starting to establish, ‘Hey this is what a relationship looks like,’ and it’s establishing that notion of consent. So where Apple don’t look for consent but they limit what you can see about a user, the GDPR then comes in and also establishes that notion of consent.

We think those two form a really solid bedrock for approaching user data in a very privacy compliant way. Off the back of it, it locks out a tonne of the ad tech ecosystem which isn’t in that position to do that. And I think that fairly respects that relationship in that transaction with the user.

To Alex’s point on that value exchange with the user, I think most people are very aware of there is a value exchange with a publisher. What people are unaware of, and also where there is zero value exchange, is the value exchange of my data to a third party vendor, or to an ad tech company I have no idea about whatsoever. That is the value exchange which is really overstepping the mark in a lot of cases.

Chris: I suppose that the big challenge then, at least from an outsider perspective trying to understand this…I write about ad tech for a living and a lot of the time I still do have to sort of look up and go, what the hell is happening in this respect! So it seems like the only constant is change for ad tech. Everything is constantly being upended. There are new techniques coming in, there’s new legislation being forced upon people who have to deal with it.

So is privacy then here to stay? Or is this something that four, five years down the line, audiences are going to forget about, and we can go back to sort of the old days of handing over data without necessarily understanding what it was going to be used for?

Joe: I think certainly our perspective on this is that privacy is so hugely disruptive that ad tech will have to be rebuilt from the ground up to function in a world in which privacy is no longer nice to have, it’s a must have.

Going forward five, 10 years from now when we look back, it won’t be, ‘Hey, privacy was this thing which came and then went, and then we went back to the old way, rather we rebuilt our industry in order to better operate under privacy’.

And I think really above anything else, although we talk about government, although we talk about tech platforms, ultimately it is the user who is driving this. The users are adopting browsers and technology which respect their privacy, and in doing so they’re forcing ad tech to change.

Although it may be championed by certain companies like Apple, and privacy may be pushed forward, actually it is in that user adoption of technology which we’re really seeing that push towards privacy, and I think that GDPR is a reflection of that, rather than this thing which came up in isolation in Europe.

Chris: I’ve read some things you’ve written basically saying that privacy cannot be gamed anymore. How likely is that that this is eventually going to be a cat and mouse game between people who are trying to game it, and the people who are preventing it and really respecting the user rights?

Joe: Oh it definitely is something which is being gamed pretty heavily right now! So the thing which we see a lot of is this notion of fingerprinting, right. Third party cookies have died, a load of ad tech companies are now hurt by the fact that they don’t have a single I.D. for a user across the web, which actually underpins Google’s business, Facebook’s business, Criteo, a whole host of very large companies dependent upon the single I.D. and actually a while back, Google were at the forefront of fingerprinting, and Apple have really been the ones who are out there trying to crush this. Intelligent tracking prevention, this ITP protocol which they have within the browser which effectively kills third party cookies.

The first few versions of that were focused on third party cookies. Actually now most of those changes are focused on fingerprinting, and breaking the hacks which Google and others have put in place.

So now we’re seeing ITP released every month or two, and that is clearly an attack on fingerprinting. So I think for a while we’ll see this cat and mouse game, but eventually the browsers will finish locking everything down.

Chris: Talking about the resurgent value of publisher data, and the data they have on audiences, what can publishers do to capitalise on that recognition again that they have that direct relationship?

Alex: We’re really seeing the value of publisher data increasing again. So previously as has been mentioned, third party data providers have aggregated publisher data, scaled it out, lookaliked it, and sold it really cheaply across the market. And so publishers have not necessarily had the correct value attributed to it being the source of all of that data.

But also we’ve kind of been a little bit missed out of that chain. What we’re really starting to see now, theoretically at first but it’s starting to come into practice, is the value going back to publishers to recognise that this is, the base of all that data and also the real values is with us.

At Dennis, we’re really trying to obviously focus ourselves as a really trusted data partner. We’re definitely starting to see agencies and brands engage with us a little bit more, request more of our data sources. I think what we’re not quite seeing yet is a shift to recognising that sometimes less is more with data. So we don’t really lookalike, we don’t use third party data, we don’t try and scale out our audiences if they’re not audiences that should be scaled.

We’ve had data requests come in, someone who lives in Bromwich who’s a CEO of a company that’s 5,000+ people, with a turnover of X, who also buys Christmas presents, like how many people are there really!

Chris: That sounds like somebody who’s trying to find an ex!

Alex: And they’d also like to deliver a million ad impressions against it over a week, for example! Okay maybe a bit of an extreme example, but it’s not so uncommon to want something that is quite niche, at scale, but also quite cheaply.

Chris: I want to find gullible millionaires!

Alex: That’s actually a really good name for segment, I might create one when I get back!

So what we can do, we obviously always try and do an education piece. So one of the things that we do when we go to agencies and brands is we talk a lot about how we get our data, how we collect it, what we do with it. We talk about some of the unique features that Permutive allows us to do, so real time targeting is really key one for us, but also as we’ve mentioned, the ability to be able to collect data on sites like Safari where third party data is blocked, so there is no where else that is accessible to get that data.

We’ve also been quite cautious about which data partnerships we engage with for years, because we don’t want a huge amount of our data being put into the system and devaluing what we can do if brands come to us direct.

However, that’s not to say that someone’s not going to be able to go and buy an in-market for car segment at [50p] per thousand to hit millions and millions of users. What we try and do is to explain to them, you have no idea where that comes from, you don’t understand anything about what those users actually…those users are probably someone who looked at one car review, or anything to do with motoring, but there’s no way of actually qualifying that intent.

I think that’s the real key thing, is we’re happy to qualify our data, and what we really need to see next is brands and agencies wanting to engage with that, but also be willing to pay for it.

Joe: See I think Alex touched upon all the key themes which we really believe in market right now. At a very high level, what we’re seeing is over the past 10 years there’s been this huge oversupply of data. Third party data has swamped the market, and it’s devalued data as a whole.

And now all of a sudden that third party data is drying up, and it’s drying up very quickly. So now there is third party data only around 30, 40 percent of the Internet, and that is shrinking at a very rapid rate. And as that supply starts to come down, what you see is actually publishers are left as the only ones in this ecosystem holding any data. Although there is less data, the value of that data now increases.

The second thing which Alex touched upon which we really believe is a great thing is, there is no transparency in data right now. And the IAB in putting forward this audience taxonomy and transparency proposal, actually it is a great vehicle for publishers to now go out and say, ‘Hey, actually this is declared data. This is real data. This is how we build our audiences versus all these other companies who are doing very obscure modelling to figure things out.’

So I think there are two things, one is data is shrinking at a very rapid rate which is increasing its value, and publishers end up as the only one that’s holding any data. And number two is, as transparency comes to market, it, to Alex’s phrase, shines a light on the fact that publishers are the ones who have real and high quality data.

Chris: I think we found the podcast title, shining a light! Coming into this I was talking about whether this is a change that has been forced on publishers, and it felt like I was almost underselling exactly how much this might be able to change the industry. But between the two of you, it sounds like there’s actually quite a lot of optimism that publishers really can take the lead in rebuilding that, in re-establishing their value within that data chain. And more importantly doing it in a way that really respects the audience.

So do you think this is a cause for optimism, rather than something that is very reactionary?

Alex: At Dennis Publishing, we’ve always prided ourselves on our agility. It’s evolve or die a lot of the time, right? It’s a slightly dramatic expression, but one of the things that you mentioned earlier was the only constant is change. And I think there is no industry that feels like there is as much change. I’ve been at Dennis Publishing for nine years, and I always said I’d leave when I was bored, and I’m still here, and still never bored. I don’t have the luxury of boredom.

Chris: Those rugs are going to keep being pulled out!

Alex: Because there’s always another challenge, and there’s always another focus. I think that as I said, we know we have to be agile with it, we have to always be ready to change, and we have to be potentially looking at the way that the wind’s going to blow in a few years time. There is a huge opportunity.

There’s a huge opportunity because sadly not everyone will survive the next few years, so if we can assert ourselves, and we can position ourselves, probably a better expression, in a positive way doing things in a legitimate, trusted environment, transparent environment, then we will thrive. And I think we’re in the position to do that now.

Chris: That’s perfect. I’m feeling happy. And so do you agree that this is a potential sea change moment?

Joe: Yeah I think for us as a company, we believe that actually privacy presents the biggest opportunity publishers have faced since digital started. And the reason why is, it massively revalues the relationship with the user, and that leaves the publisher on top.

So for us as a company, everyone is always asking us, ‘When are you going to stop selling to publishers and move into new verticals?’ For us we’re always saying, we really believe that publishers are a big business, and really the reason behind that is because of this privacy, and because of that relationship.

I’ve never been more optimistic about how big a business publishing can be than I have at this point.

Chris: That is really aggressively optimistic about the future!

Alex: The key thing is, if publishers crumble, everything crumbles, because publishers are the front and centre of the entire business model. So there is a vested interest in all of us to sustain ourselves.

But at the same time, we have to do that in a way that is compliant with the law, that is morally right. Because things are changing, maybe I don’t think I realised a few years ago quite how much of a change this would be, but it is, it’s here.

And so let’s try and position ourselves in a positive way for it.


This episode of Media Voices is sponsored by Permutive, the data management platform built for publishers. Permutive enables publishers to increase their data driven advertising revenue and make revenue diversification a reality, whilst keeping user privacy at the heart of its technology. Some of Permutive’s customers include BuzzFeed, Business Insider, The Economist, Condé Nast International, Immediate Media and Burda Forward.

Understand how to use your data to gain a competitive advantage and increase your revenues in The Data Maturity Curve for Publishers.

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