3 thoughts from me: (1) G likely released YouTube #s for 1st time to drive press who fell for it. $ share to legit pubs isn’t remotely close to current perception, (2) G didn’t want market narrative about data/regulation which took 10% from FB’s stock when CFO warned about it. /1
(note FB watched Google point market with YouTube and poof we finally have Instagram #s), 3) GOOG isn’t divesting its ad services proactively, it’s not simply a low margin 30/70 split business. OK, I need to get a sandwich, but will be back shortly to finish this thread. /2
back at it. On #1, see thread with prediction for FB earnings and CFO's note (). This caused Facebook stock to drop ~10%. Facebook and Google can't allow market to know data regs may contain and slow their dominance. If it does then market seizes it. /3
So Google needed positive narrative for earnings. They were already under SEC pressure for taking advantage of loophole to hide YouTube numbers and Pichai's promotion to CEO made their rationale to SEC unsustainable. I wrote about issue in Mar 2018. /4 (digitalcontentnext.org/blog/2018/03/0…).
everyone led with YouTube's $15B and followed with stories like @petersontee whether disclosure would push Instagram to also share revenues. Maybe...all fair coverage. digiday.com/media/alphabet… Here is the thing, though. We still barely know anything about YouTube's ecosystem. /5
In 2018, we did a benchmark report from actuals across @dcnorg members (digiday.com/media/alphabet…). Even if I assume 50% YOY growth, YouTube is paying hundreds of millions to DCN members/year. Considering press estimated payments more than $7.5B from YouTube, it begs questions. /6
Clearly almost all the $7.5B is going to long tail, independent creators, small YouTube shops. That's the best case. But how much is going where? Long tail also includes overseas content farms, rights infringing content, toxic content, etc. @60Minutes had good segment on it. /7
It's also worth noting things YouTube TV also launched which is an entirely different dynamic in terms of revenue ad sharing based on licensing deals more akin to the MVPD world. /8
Heck, YouTube built Russia Today into a juggernaut over the years (). So I'm just not willing to look away and say "great, we know the #s of the most dominant distributor in digital video advertising, they're sharing a lot of revenue, so let's move on." /9
OK, that covers #1 &2 so on to #3. No, I don't buy reports Google is considering proactively spinning ad services business (it claims it only keeps 30% revenues). First, the 70/30 split is contested in many ways. Critically this includes value of data. /10 wsj.com/articles/justi…
If you want to understand the regulator scrutiny around data and antitrust for Google (Texas, FTC, Justice, Judiciary) in US, look across the pond at the UK CMA (competition authority) investigation. Particularly Exhibit E. /11 assets.publishing.service.gov.uk/media/5df9ecc0…
DCN has helped distribute research (digitalcontentnext.org/wp-content/upl…) to set baseline on most ways in which Google collects and mines data on our browsing, device-usage, location and offline lives. We knew most of it happened when we weren't actually wanting to interact with Google. /12
But the UK CMA report went in hard with the authority and capabilities of a regulator. This chart is a very important one to understand. Figure E2 (p17). The blue dot is where Google's ad services come into play. /13 
Google mines data from 8+ million sites it has tags/cookies. Other ways it can get data are from its own apps in background, Android devices, logged-in Chrome users. In all cases, browser/OS changes (hello Apple) and regulations (hello GDPR, CCPA) are creating risk for Google /14
#132-136 (p37-38, Exhibit E assets.publishing.service.gov.uk/media/5df9ecc0…) are also critical. Highly respected researchers (Acquisti, Marotta) empirically showed current data system (3rd party cookies) drive most $ to intermediaries (Google being #1) and pubs only get 4%. /15 wsj.com/articles/behav…
Although Acquisti study left Google speechless, it set off G's trade groups (primarily via @adexchanger) with counter narratives to dispute study. Mostly with misleading points. In all cases, they narrowly looked at behaviorally targeted ad CPMs being higher with data. Duh. /16
Google also posted blog stating 52% of $ will go away without 3rd party cookies. CMA does nice job analyzing in 133-135 and has begun to probe Google's data. Important as Google buried the flimsy "research" and won't discuss publicly. Google is clearly an interested party. /17
#143-145 also seem to call into question whether Google has leveraged its dominance to keep access to data way outside the rules of GDPR. Again, this is why antitrust and data policy are on a collision course. @ronan_shields covered this week. /18 assets.publishing.service.gov.uk/media/5df9ecc0…
Everything above in 11-18 is critical to understand for all antitrust investigations happening globally. Particularly that exhibit E. Highly relevant especially if incremental data has even more value. It’s how Google and Facebook eat the world. positive opportunity is that /19
Antitrust and data regs are happening. It’s why Facebook’s CFO had to warn. It’s why Google is creating a 2yr window to react on 3pty cookies. It’s why legit pubs are looking towards 1st party data and other forms of revenue tied to their direct, trusted relationships. /20
