Analysts Predict the YouTube Advertiser Boycott Will Cost Google $750 Million

Posted April 06, 2017

Google's initial response, a promise of new controls for marketers, failed to curtail the boycott.

The fallout has dealt a major blow to Google and led to a number of big companies pulling their advertising from the video-streaming platform.

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What's more, GroupM is now using OpenSlate for all YouTube's channels, including the seemingly safe haven of Google Preferred, which entails only the top-performing clips. Automatically classifying entire videos, then flagging and filtering content is a more hard, expensive research endeavour and one that Google has not focused on much - until now. "We have limited resources". To be sure, Google has taken steps to prevent companies from appearing to support offensive videos by giving them more say over where their ads are placed.

But, he added: "Shutting off all Facebook or YouTube is just silly". Google has responded by promising greater transparency and saying it will be more aggressive in ensuring brand safety of ad placements. The company's SlateScore has become the industry standard for measuring the quality of content on YouTube. GOOG, +1.08% GOOGL, +1.06%, told marketers and advertisers that it plans to allow third-party measurement companies to monitor where ads appear on YouTube, and to report back to marketers on the "brand safety" of its videos. "We are working with companies that are MRC-accredited for ad verification on this initiative and will begin integrating these technologies shortly". That's in addition to more than 250 United Kingdom advertisers who have frozen spending on YouTube, an exodus touched off by a report by the Times of London that ads from major brands were appearing in videos posted by white supremacists and other hatemongers.

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"It has always been a small problem", Schindler said, noting that the only change is that it hasn't been pointed out, until now.

It's not an easy problem to fix, even for a company with the brainpower that Google has drawn upon to build a search engine that billions trust to find the information they want in a matter of seconds. "This is good news for the two sides of the spectrum, but everyone in between is likely to get squeezed, with at least a portion of the dollars, if not half or more, going to platforms like Google". For small operations and individuals, it lets them display ads and collect ad revenue without having to sell the space themselves. Google apologized for last month and now Google's chief business officer, Philipp Schindler, opened up to Recode about the issue. And his statements about the boycott showed how convoluted Google's position is.

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New default setting: Ad settings will now default to exclude "potentially objectionable content". Content that promotes negative stereotypes of certain groups through inappropriate jokes and insults and content that denies sensitive historical events such as the Holocaust, will also be included.