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A+E and CBS Debate the Merits of Walled Gardens in an OTT World

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Walled gardens are still with us as consumers turn to streaming video and advertisers chase after them, but will those walls come tumbling down?

A+E, for one, doesn’t think so. During an Advertising Week session called "The Streaming Wars Paved the Way for an Ad-Supported OTT World," Jason DeMarco, A+E Networks' vice president of programmatic and audio solutions, noted that today's walled gardens extend past Google, Facebook, and Amazon, and are, in fact, becoming more popular. Content companies see value in having their own exclusive sales offerings. These gardens create revenue opportunities with little friction. But if the area is going to grow companies will need to form additional partnerships, adding more content to their exclusive offerings—or a few more beds to their gardens.

Taking the opposite view was Jason White, executive vice president and general manager of global programmatic revenue for CBS Interactive, who doesn't think walled gardens can maintain. “At the end of the day the marketer needs to have the ability to manage all their campaigns across all supply pools," he said. Closed platforms, like those from Roku and Amazon, make it harder for marketers to compare results and optimize their campaigns. "Openness is better," he added.

With the California Consumer Privacy Act (CCPA) set to take effect at the beginning of 2020, privacy is also a big topic at Advertising Week. A+E's Demarco sees privacy regulations as necessary at this point, since the ad industry didn't do enough to self-regulate, but he can't see how the government can effectively police privacy rules. The lesson from  Europe's GDPR is one of inconsistency, he believes, with some infractions getting heavy fines and others being ignored. Advertiser IDs can be erased, but the general public doesn't know how to control their data. Whatever mechanisms are put in place need to be well publicized, perhaps with PSAs.

As other states pass their own consumer privacy laws, CBS's White believes online companies will simply adhere to the one that's the most stringent. He's in the process of adapting to the CCPA's demands now by adding "do not sell my data" controls to pages. What these measures will mean for online ad sales remains to be seen. As Maggie Mesa (vice president of mobile business development for OpenX) noted, consumer response to data privacy controls is the big unanswered question. What will the opt-out rate be? The industry can only wait for the answer.

 Photo: Maggie Mesa of OpenX and Jason White of CBS Interactive

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