Q&A with DoubleClick CEO About Google Acquisition & Digital Privacy

GooglelogoThe Wall Street Journal (subscription required) has an interesting Q&A with DoubleClick CEO David Rosenblatt about the pending acquisition by Google. Rosenblatt tries to reassure consumers and privacy advocates that this merger won’t change how safe their data is. He says things like, “Ad-serving information collected by DoubleClick has always been the property of our clients, not us… so we are very comfortable with our current policy.”

“Current” being the operative word. Companies change policies all the time. It’s nice DoubleClick’s “current policy” protects me, but it’s not difficult to see why privacy advocates would want to see a force external to the company to ensure this going forward. So are his answers reassuring? Judge for yourself, the Q&A follows:

Wall Street Journal: Can you reassure Web publishers who rely on Google for ad revenue and traffic but worry about Google’s increase in market power?

Mr. Rosenblatt: I can’t speak on behalf of Google since we’re not owned by them yet. But Google shares revenue with publishers so it makes sense that their interests are pretty well-aligned.

WSJ: Digital-privacy advocates have raised concerns about the Google-DoubleClick merger, saying neither company has taken steps to safeguard the data it collects about consumers’ Internet behavior. How do you intend to respond going forward?

Mr. Rosenblatt:
Ad-serving information collected by DoubleClick — and this is a really important point — has always been the property of our clients, not us. And so a change of ownership of DoubleClick will not change the terms of those contracts…so we are very comfortable with our current policy.

WSJ: Some say the ad serving that DoubleClick does would be an obvious complement to Google’s push to sell more graphical and video advertising. What does it take to implement more graphical and video advertising?

Mr. Rosenblatt: In general, video advertising as a trend is pretty firmly in motion. In spite of that, though, it is still very small. There are somewhere between half a million and a million search advertisers in the market, there are probably only a couple to five thousand graphical advertisers and probably less than a hundred video advertisers. There is no reason for that imbalance to exist. So one of our goals is to increase efficiencies with which people buy and sell video advertising and democratize access to the process in the same way that Google has democratized access to the search market…It is going to be easier to buy video advertising, and therefore many more people are going to do it.

WSJ: What is getting in the way now?

Mr. Rosenblatt:
Many of the tools to produce and track and measure video advertising are still extremely immature. For example, there are a lot of systems in place for graphical advertising to both collect data and also monetize the advertising so that it gets the highest response rate from customers. Many of these things are just not possible today for video advertising.

WSJ: For example?

Mr. Rosenblatt:
It is not possible to dynamically switch ad content (in ads that run before online videos) in response to user response on a large scale. That is an example of something I think will broaden the market. It is still very difficult to create the video ads themselves. That’s another thing that I think will become easier.

WSJ: What else do you see advertisers hungry for?

Mr. Rosenblatt: Advertisers are interested in two things. One is increasing the efficiency of their media buys. It still costs too much to spend money online compared to offline. For example, every part of the process is still not as efficient. Everything from tracking measurement across thousands of Web sites, collecting all of those forms of data, billings, physically trafficking ad units out to publishers — all of those sorts of things are still too manual…The second thing advertisers are looking for is measuring the efficacy of their media. So I think we as an industry have done a good job of perfecting that measurement within specific channels, like search or within graphical, but not as much between them. If you have $100 to spend and you have a certain goal for your advertising, you should be neutral between spending that on graphical, on video, on search media — let alone between the Internet and offline channels. But in order to make that decision you need tools to help you measure the relative efficacies, and those don’t really exist yet.

WSJ: What does the Google-DoubleClick deal mean for advertisers and publishers? What differences will they see?

Mr. Rosenblatt: Interestingly, the search part of online advertising was very small in 2000 compared to what it is today. One of the reasons it grew so much was because Google and Yahoo and others were able to create levels of access and efficiency within that market that hadn’t been there before. If we can do the same thing with display, there is no reason why it wouldn’t have a comparable effect with those [graphical and video] ad models.

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