Telecom Giants Looking to Compete With Silicon Valley for Ad Dollars
Telecom giants AT&T and Verizon feel they can compete in the digital advertising space based on the huge amount of data they’ve collected from their users over the years.
Now that AT&T has closed its acquisition of Time Warner, it’s thought that they are better posed than other telecom giants to take some of Facebook’s and Google’s advertising revenue. AT&T also recently purchased AppNexus to build out its advertising business. Of course, it’s been a long time since companies like Verizon and AT&T were known just as “the phone company.” AT&T owns DirecTV, with the Time Warner acquisition they have CNN and HBO. Verizon purchased AOL and huge chunk of Yahoo!, rebranding it Oath, which includes Huffington Post and the social network Tumblr.
Telecoms have been buying studios and content producers in recent years, as Comcast bought NBCUniversal, Verizon starting and then abandoning GO90 and then AOL and Yahoo!, and now AT&T gobbling up Time Warner’s Warner Bros, HBO, and CNN and the Turner Networks. Since they also operate in many markets as internet service providers and cable operators, they have vast amounts of customer data, which is a huge concern for privacy advocates. It also impacts the Net Neutrality debate, and the ISPs have long thought companies like Google and Facebook were getting a free ride on infrastructure they built and maintain. According to The Verge:
AT&T, in particular, may be well-suited to build profiles of its customers that it can use to sell targeted advertising. If you’re an AT&T cellular customer, the company already has access to real-time location data, mobile browsing activity, and other lucrative personal information. It can cross-reference that data with the information you provide the company when you sign up for its service, along with information it may be able to glean from your viewing habits if you subscribe to DirecTV and information it can purchase from third-party data brokers.
- AT&T now owns an internet service provider (both Time Warner cable and their own DSL/Fiber-optic network), a cellular service provider, and a satellite cable TV provider (DirecTV).
- AppNexus gives AT&T a programmatic advertising network it can use to plaster ads on the web, within mobile apps, and on television.
- Verizon owns Oath brand, which contains the remnants of Yahoo and AOL in addition to its own phone business, ISP, and cable platform.
- Every one of those businesses and media properties provides the companies with a built-in dataset and the means to help companies target ads to customers in a way that may rival Facebook and Google.
- The rollback of Obama-era privacy rules means telecoms now have no check on how they decide to handle sensitive user data.