GM Thought of the Week

Google launches YouTube TV – can it compete in the mainstream?

This month, Google announced the launch of YouTube TV in the US – a monthly subscription-based service that will allow users to stream live and On-Demand TV via online devices.

It’s an interesting move from Google, and one that may not seem entirely logical at first, considering the competition it will face from already established streaming services such as Netflix and Amazon. However, I think it makes sense that Google would try to position YouTube as a partner that can offer it all in the hope of appealing to more advertisers and gain a larger share of their AV budgets.

Particularly in the kid’s market YouTube, and in fact digital channels in general, are used as an additional channel to reach lighter TV viewers or as a secondary touchpoint for audiences already exposed to a TV campaign, but are rarely able to deliver objectives as a standalone channel as efficiently as TV. With the launch of services such as YouTube TV and the likes of YouTube Kids, Google is offering advertisers an opportunity to keep up with the ever-changing way that people of all ages are consuming media.

As specialists in youth, we know that kids and parents are using online to watch content more and more frequently, and we can’t ignore this shift in behaviour. Whilst YouTube TrueView has provided us with an opportunity to begin capitalising on this viewing behaviour, it has come up against many challenges to do with brand safety and accuracy of its targeting. These newer platforms are Google’s way of being able to deliver more robust targeting of specific audiences in safe and contextually relevant environments.

Whilst YouTube TV is unlikely to pose any immediate threat to TV and VOD services yet, with the rate of change in both consumer behaviour and choice for accessing content it is a question of ‘when’ rather than ‘if’ this will have an impact on the media landscape.

Rebecca Price, 13th April 2017

Google Rivals’ Search Returns No Results

Google is again featuring in its own search results: owing to the revelation that the corporation narrowly avoided prosecution by the US government back in 2012.

It was the opinion of the giant’s rivals that Google Search was monopolising the market. The Federal Trade Commission subsequently investigated the claims, and whilst there was appetite to prosecute, ultimately the case was dropped.

It brings to mind Amazon’s current dominance of the market in the UK, with rival businesses unhappy at the way Amazon undercuts their prices. The burning issue in both cases is a question of “playing fair”. Google’s rivals argued that the search engine removes content from certain web pages in order to improve its own search ranking system. However the agency concluded that “Google did not abuse its market position to hurt rivals” and Google itself added “speculation about potential consumer and competitor harm turned out to be entirely wrong”.

One could suggest that the case of the Google furore demonstrates very different conditions to those featuring in other recent news scandals: tax evasion/avoidance, price fixing – ie actions that are morally or legally wrong. This is arguably just a case of Google providing a better product than its rivals, with the public the ultimate judge of character. Microsoft installs Bing on every new computer; with said search engine also powering Yahoo! – so the consumer has to make a conscious choice to opt out of this, and into Google. The majority do. Ultimately each case has to be judged individually, but if a Digital property is able to slash its overheads to make its product the cheapest on the market, then why shouldn’t a consumer choose to use it? Should a Digital corporation be punished for its success? We are entering a much wider debate.

Of course, success equals revenue – and in the Digital space this mantra is king. In the US, Google has the largest market share by a search engine (75%), but in the UK, the dominance is even more pronounced. Few markets are monopolised more than our own – Google controls a staggering 88% of search share as of February 2015. This compares to 7.2% for Bing and 3.8% for Yahoo. Bear in mind that this translates into ad sales share: a lot of ad sales. It is estimated that Google controls just under one third of all Digital advertising worldwide, and around half of all mobile advertising. Can we put a figure on that? It’s tricky, but in 2015 that could equate to £2.5bn in revenue. Little wonder that Google’s rivals are up in arms and looking to arrest their dominance.

Sources:

http://www.bbc.co.uk/news/technology-31981498

http://theeword.co.uk/info/search_engine_market/

http://uk.businessinsider.com/heres-how-dominant-google-is-in-europe-2014-11

http://www.emarketer.com/adspendtool