YouTube’s $25 billion ad problem, and the changing Google policies

YouTube’s $25 Billion Ad Problem, And Alphabet’s Fix

Alphabet Inc., Google’s parent company, and the owner of YouTube, recently announced that it is introducing a new system that will let outside firms verify advertisements’ quality standards on YouTube.

Coming as what Alphabet hopes, will be the remedy to the huge advertising boycott YouTube has been up against lately, this change also embraces wider definitions of “offensive content”.

Over the last few weeks, a whole bunch of companies including AT&T, Verizon, Enterprise and even the British government have pulled their ads off of the YouTube platform following the British government’s vociferous objection to one of their ads being played on top of an extremist video that featured highly provocative and offensive content.

The British Government’s reaction and consternation placed the spotlight on YouTube’s current policies that stated that all ads YouTube carries were overlaid atop videos basis the amount of viewership of the content, but did not consider the content of the video itself; nor did it (YouTube’s algorithm) look for any parity between the video’s content and the ad itself.

YouTube did have some checks in place to ensure sensitive content was flagged, but the definition of “sensitive” or “offensive” that YouTube used so far was very loose and half-hearted.

The cause and the effect combined to made the situation extremely problematic for the brands, YouTube, and Alphabet itself.

Why? Well, YouTube’s erstwhile policies and methods basically meant that videos supporting terrorism, extremism and such morally offensive subjects had ads running atop them from brands of every nature, who had absolutely no support or allegiance to said videos. In fact, none of them would’ve really known of this disparity either, given the randomness driven by the automated algorithm that places ads on the platform.

Miffed and offended, many large brands pulled their ad campaigns off of YouTube, and involuntarily triggered a boycott of the platform by other brands too.
This included brands like PepsiCo., Johnson and Johnson, and WalMart, amongst many others.

Let me diverge for a bit, and state the un-obvious.

Just a few months ago, something of the kind would perhaps not have gained this form of momentum or impetus.
The fact is that there is a rising anxiety in people’s minds regarding the trustability of the “new online” – everyone has become a little extra sensitive to whatever they see online. The entire Fake News incidents and how people could’ve been manipulated by what they read/saw online is still very raw in their minds.

Add to this the fact that Facebook recently admitted flaws in how it reported ad performance to ad buyers.

With all of that in play, digital advertising has come under greater scrutiny lately, and thus Alphabet’s YouTube problem kept snowballing as things rolled downhill.

To be fair to Alphabet, navigating this issue is certainly no cakewalk. Content worth as much as 400 hours is uploaded to YouTube every minute, and navigating through that much content is obviously not an easy job.

To top it all, as per Alphabet’s erstwhile policies, any channel with a certain number of views were seeded with ads running on top of their videos. Alphabet had not implement, so far, any methods to categorise channels basis the nature of the content they doled out, nor had they formulated differential policies towards the ad-overlays.

Amidst all this though, is one undeniable fact – advertisers and brands depend upon Google’s system to get them the best results. So being the customer, brands’ interests and brand image is paramount to YouTube’s existence, even more than it’s revenues.

Quite a good example would be that of Google’s AdWords, the larger ad business that Alphabet runs across the internet. Over the years, it has been Alphabet’s policy to not stand between the publishers, and the advertisers, for fear of becoming too much of an arbiter of what’s appropriate.

But in the process of making the path from advertiser to targeted audience eyeballs as efficient as possible Alphabet does make a lot of money. So it must then, not shrug away from the onus of responsibility when its systems run into issues.

Even after apologies, and statements promising that steps would be taken in this regard, brands are still pulling the plug on their YouTube ad spend, and Alphabet’s shares are doing the frisky dingo on the charts.

All in all, Alphabet has lost about USD 25 billion to this tailspin that YouTube has hit, and even though that number does pale in comparison to the entirety of Alphabet’s income, it is still quite a big number.

The new policies should be of some relief. After the forest caught the fire, Alphabet has improved its ability to flag offending videos and immediately disable ads. This has led to some advertisers circling back.

With these new changes in the policy, we can expect more advertisers to come circling back. But the question will still remain: see Is this going to be the solution?

We think not.

Even though the policies have been changed to broaden the definition of sensitive content, there’s not enough information shared by Alphabet to convince the world that there are now enough checks in place to mark sensitive content as such and treat it differently.
Case in point would be that of YouTube channels like Real Women Real Stories.

Run by Israel-based entrepreneur Matan Uziel, the channel features videos of women narrating to the camera their experiences of sexual abuse. Under even the amended policies, this would be marked off as sensitive content (under the unchanged policies it was marked off as sensitive content, and ads were taken off of the channel).

And there are many other channels of this kind that have, and will be, marked off.

So, even though it may be quite clear what content a channel is running, machines and algorithms don’t really yet know to interpret it correctly. The content in Real Women Real Stories is not particularly offensive, not promoting terrorism, extremism, or violence of any kind – but it did get the stick.

What I’m saying is that there is rather a much-needed journalistic approach to real stories that need to be told. Yet, these channels will receive the same treatment as purposefully offensive content made with mal intentions do. That does not seem fair, and neither do the policies enabling such interpretations.

So, while Alphabet has admittedly taken the first baby steps – only after having been kicked in the gut by the advertisers – yet, there is a long way to go for them to actually be able to work this out properly.

With YouTube’s ad revenues hopefully preserved now, Alphabet must surely realize that the task is not yet done.

Also published on Medium.