What’s a modern digital publisher to do? The publishing industry must “straddle apps and the web more than most mobile categories” according to a NYTimes article this week, and on top of that publishers have to grapple with the duality of products from a funnel perspective. New readership often comes via the publisher website and heavy users move on to the app download, but where should marketing dollars go? And which is ultimately more lucrative after all costs are accounted for?
VigLink CEO Oliver Roup weighed in saying, “we’ve seen it with AOL before- its to the publishers advantage to stay on a platform they can control.” While the in-app experience can create a premium feel and publishers might initially feel they have control over the entirety of the app they have painstakingly developed, Apple and Google’s bottom line motivations will far outweigh even the biggest lobbies from the largest publishers when it comes to winning their respective advertising agendas.
The endgame driver is not at all what consumers or publishers hope or actually want, not what’s best for publishers, but instead the ever-diverging paths to revenue between Google and Apple. Selling devices means Apple’s closed system has to be the company’s mission, while Google needs open search to serve ads. The two companies continue to control as many aspects of their platforms as possible, from much-talked about Apple’s allowance of ad blocking (which we covered here) to so-called “app blocking” from Google which will start next month. Not surprisingly, while Google is working to block app popups, the company is also making its mobile internet much faster and friendlier. However, in reviewing the Google product, many have pointed out that no one is out from under the company’s thumb. “There are real similarities to native hosting. Google and its partners will still wield non-trivial power in how advertising and tracking can take place within the system. While the system allows for third-party caching, Google’s powerful hosting network means the vast majority of AMP content will likely be hosted on the company’s servers” says The Verge. Not an unimportant observation and comparison.
In a report recently sent to clients, Goldman Sachs claimed that digital advertising is soon to be “fundamentally restructured” by Apple, Google and Facebook. As covered by BI, Goldman’s analysts predict “the infrastructure underpinning the digital ecosystem to likely go from the fragmented oversupply of largely recycled or undifferentiated content sites supported by a massive ad tech ecosystem toward consolidation around platforms and content owners.”
Goldman predicts a closed advertising platform for Apple (a la iTunes) and Google will continue to assert its power by policing ad formats that aren’t user friendly (harkening back to letting go of flash support, and pushing non-mobile optimized sites to the bottom of search).
All of this means that publishers must either make a choice (web or app) or monitor carefully the moves of both Apple and Google in order to optimize for the choices of both companies. No matter what big company agendas manifest, Roup echoed what many internet veterans have agreed with and said in their own words recently when he stated “the open web should continue to be more advantageous to publishers.”