How ad tech is changing the world (really)

GumGum VP ANZ sales, John Stubley
By GumGum VP ANZ sales, John Stubley | 6 July 2016
 
GumGum VP ANZ Sales, Jon Stubley

I’m serious.

Adtech gets a pretty bad rap. At worst it is accused of ruining the online experience and at best it is seen as a necessary evil; the irritating cousin whom you are obliged to invite to your family party even though you don’t really want to.
Like that irritating cousin, some of the bad rap is warranted. If an ad is intrusive, irrelevant and annoying, it negatively impacts the user experience. When this happens, companies absolutely should be called out on it (although the spectre of ad blocking is also doing a lot to focus the minds of those particular culprits).

But the same technology that is seen as a necessary evil is quite genuinely driving innovation and real social change.

How?

First and foremost, it is bank rolling the two current behemoths of innovative technology experimentation – Google and Facebook.

A search engine at heart and at its genesis, Google is the Google (and Alphabet) we know today because of the introduction of AdWords in 2000. In 2001, Google’s ad revenues stood at US$700 million. Fifteen years later, they stood at US$67.39 billion (the majority of the company’s overall US$75 billion in revenues).

This in turn is funding a raft of innovative and experimental technology. And it isn’t an insignificant investment. Google is currently running at a $US3.6 billion operating loss on experimental projects like Google Fiber, driverless cars, Nest thermostats, Project Loon Internet balloons (balloon-powered internet for remote locations), Verily Life Sciences (medical research), Calico (aiming to prolong human lifespan), and whatever other Blade Runner-esque projects that are going on at Google’s pleasingly named “moonshoot’ factory, X.

Inevitably, not all will see the light of day, but for every Google Glass (and dare I say it, Google+), there is little doubt that some of these initiatives will fundamentally transform our society in the not too distant future and deliver a disruptive ripple effect on industries like the auto sector while they are at it.

Plus, let’s not forget that on a more prosaic level, AdWords has also contributed to investment in products like Gmail, Google Docs and Android, among others, that have helped make lives more efficient and collaborative for businesses and individuals alike.

Facebook isn’t lagging too far behind. Deriving $17.08 billion of its $17.93 billion in total revenue from advertising, it is now beginning to morph into more of a technological power play.

As Google did before it, Facebook is using its ad technology as an investment vehicle to create a more diverse business and experimenting with different products and services. Both virtual reality and artificial intelligence are standout areas here, with its investment in Oculus Rift and efforts and investment in AI research under its FAIR initiative. It has already begun rolling out some services, including using AI to automatically describe the content of photos to visually impaired users.

Secondly, in addition to funding the most innovative companies currently on the planet, the actual technology part of advertising technology has also been used to drive innovation in non-advertising sectors.

It is rare that we get the opportunity to write about ad technology and helping to cure cancer in one sentence, but after selling Invite Media to Double Click (owned by Google) in 2010 for US$81 million, founders Nat Turner and Zach Weinberg founded Flatiron Health in 2012.

Instead of using data technology to more effectively target digital advertising, Flatiron uses data technology to dramatically improve the treatment of cancer patients and accelerate research into the disease.

In a 2013 interview, Turner explained “The technology is remarkably similar to our last company, whereby we’re building a meta layer above massive datasets and systems that today are separate walled gardens, similar to ad exchanges and networks”. And just last month, the US Federal Drugs Authority (FDA) partnered with Flatiron to assess the use of real-world data to demonstrate the efficacy and safety of immunotherapies and other emerging anti-cancer drugs.

And finally, ad tech itself is continuing to innovate.

Companies like my own have made significant investment in computer vision technology that is being used to develop a totally new form of less interruptive and intrusive advertising (in-image advertising) and there are some great strides being made out there in the world of mobile experience, personalised ad delivery and cross-platform delivery.

It would be a stretch to suggest this type of innovation will change the world, but it will change a consumer’s digital experience whilst continuing to bankroll free content and blue sky innovation.

In the meantime, next time you are irritated by an auto-play video ad (yes, I’m thinking of the same publishing house as you are), remember that one day the ad tech behind it might be responsible for bringing us the flying hover board that we all grew up dreaming about.

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