June 26 2023 - All the News That's Fit to Scroll

👋Happy Monday friends. There's a lot in today's roundup, covering almost every sector. I apologize for the long summaries, but they are juicy and worth the read. No fuss, let's get into it –

TikTok is making moves to become a shopping destination and compete with giants like Amazon and Temu by signing logistics deals with third-party firms. The company aims to ensure smooth delivery of products purchased through its app by partnering with external logistics firms to handle inventory storage, packing, and shipping. However, its biggest challenge lies in gaining the trust of U.S. brands and retailers due to concerns over potential bans on the app. TikTok sees e-commerce as a way to diversify its revenue stream, aiming for $10 billion in ad revenue by 2022. At a recent conference, TikTok employees promoted the TikTok Shop and handed out merchandise to showcase its ambitions. TikTok has been building its e-commerce team, hiring a former Amazon and Alibaba executive to lead its U.S. logistics efforts.

The Directors Guild of America has ratified a new three-year contract with Hollywood studios, with 87 percent of members supporting it. The contract brings gains in wages, streaming residuals, safety, diversity, and creative rights. No negotiations are scheduled between the Writers Guild of America (WGA) and the studios, while talks between the Alliance of Motion Picture and Television Producers and SAG-AFTRA, representing actors, are ongoing. The DGA expresses solidarity with writers, actors, and crew members, sharing similar priorities.

Apple's executives at the Cannes Lions festival took a cautious approach to their ad ambitions, focusing on analyzing the advertising landscape rather than revealing any big plans. Their conversations with ad tech vendors centered around their search business rather than discussing their own ad-tech plans. Apple aims to grow its search ads business, which has been successful since implementing privacy-focused changes three years ago. While Apple has been gradually laying the groundwork for ad tech, a full-fledged ad tech stack is not expected anytime soon. Some individuals at Cannes felt uneasy about Apple's lack of transparency and disruption of the advertising landscape through privacy changes.

IBM is reportedly in discussions to acquire software company Apptio for a price ranging between $4.5 billion and $5 billion. The potential deal is part of IBM's strategy to further expand into automation technology. Apptio, currently owned by Vista Equity Partners, offers online services for IT budget management, forecasting, and analysis, with a significant customer base including Fortune 100 companies. IBM's CEO, Arvind Krishna, who has been reshaping the company, has expressed a focus on smaller acquisitions following the $34 billion Red Hat acquisition.

• Creative Company of the Year: 1) Omnicom, 2) WPP, 3) Interpublic Group
• Network of the Year: 1) DDB Worldwide, 2) Ogilvy, 3) BBDO Worldwide
• Independent Network of the Year: 1) Gut, 2) Wieden+Kennedy, 3) Rethink
• Agency of the Year: 1) Gut, Buenos Aires, 2) Publicis Conseil, Paris, 3) adam&eveDDB, London
• Independent Agency of the Year: 1) Gut, Buenos Aires, 2) Rethink, Toronto, 3) Wieden+Kennedy, Portland
• Palme d’Or: 1) Somesuch, USA, 2) Smuggler, U.K., 3) Biscuit Filmworks, USA, 4) Spoon, Japan, 5) Rebolucion, Mexico
• Creative Brand of the Year: 1) Apple, 2) Dove, 3) Heineken

• Infiniti is undergoing a brand refresh to distinguish itself and embrace its Japanese heritage. The refresh includes an updated logo, redesigned showrooms, unique sounds, and a proprietary fragrance. The new logo features a three-dimensional illuminated version that integrates road lines into the grille. Infiniti's showrooms now resemble modern bungalows with floor-to-ceiling windows, indirect lighting, and wood slats instead of walls. A bespoke aroma of wood and citrus has been developed to create a tranquil atmosphere, accompanied by a signature sound called "Moment of Tranquility." The brand refresh aims to attract and retain luxury vehicle buyers, particularly as Infiniti focuses on introducing more electric and plug-in hybrid models in the future.

• Lionel Messi's groundbreaking contract with Major League Soccer's Inter Miami CF could have far-reaching implications for the power balance between athletes and team owners. The deal not only includes a high salary for Messi but also gives him a share of MLS' broadcasting deal with Apple TV+, a cut of league sponsor Adidas' profits, and an ownership stake in the team. This new model, inspired by tech companies' compensation practices, allows players to have unprecedented leverage in contract negotiations and could potentially reshape the relationship between athletes and ownership. While currently unthinkable in leagues like the NBA and NFL due to their collective bargaining agreements and salary cap structures, Messi's deal and Saudi Arabia's aggressive moves in pro sports could lead to increased power for superstar athletes in the future. The concept of giving players equity in their teams could keep them more committed to their clubs and provide an alternative form of compensation beyond just salaries.
• A survey conducted by marketing agency Empower has found that over two-thirds of creative industry workers are concerned about the impact of generative artificial intelligence on their profession. The anonymous survey targeted individuals in design, communications, marketing, digital, and video production and received just over 200 responses. The study revealed that only 13% of respondents were "not at all concerned" about the effects of generative AI on their profession. Concern levels were evenly distributed across different degrees of concern, including moderate and somewhat.
• Alessandro Manfredi, the global chief marketing officer of Dove, believes that the creative ambition within a marketing team is more crucial for a brand's advertising success than agency input. Manfredi stated that the biggest challenge for Dove, owned by Unilever, is marketers lacking receptiveness to creative ideas from agencies. The pressure to deliver advertising quickly often leads to safe and risk-averse creative work. Manfredi emphasized the need to create processes within the company that encourage receptiveness to creativity and avoid playing it safe. Unilever has brought a significant number of marketers to the Cannes Lions festival this year and established the Creative Council, consisting of chief marketing officers and creative directors from various agencies, to increase ambition and remove barriers to creativity. Additionally, Unilever has introduced "evergreen briefs" that allow agencies to develop ideas throughout the year, covering both product-specific and broader brand goals.

• Disney is in the process of moving Hulu's ad targeting capabilities to its streaming platform, Disney+. The company aims to achieve full ad targeting parity across its platforms over the summer. The integration requires a gradual and thoughtful approach, as it involves incorporating Hulu's less conventional ad formats, such as pause ads and binge ads, into Disney+. Close integration between advertisers and Disney's ad server is necessary to offer a variety of ad formats outside of the traditional 15- or 30-second spots. The move towards programmatic ads is a key part of Disney's strategy, with the goal of making more inventory addressable and available programmatically.
• The second day of the FTC v. Microsoft hearing focused on the console wars and the position of Xbox in the market. Xbox Chief Phil Spencer took the stand to discuss Microsoft's loss in the console wars, the aggressive competition from Sony, and the challenges faced by Xbox as a distant third-place contender. The debate over whether the Nintendo Switch should be included in the console market definition continued, with Microsoft arguing for its inclusion to solidify its position in third place. Spencer acknowledged the hardware differences between Xbox and the Switch but emphasized that Nintendo is still a competitor. The hearing also touched on Microsoft's struggles to compete with PlayStation, the motivations behind the Activision acquisition, and the potential for Xbox exclusives. Spencer reaffirmed Microsoft's commitment to keeping Call of Duty on PlayStation and addressed concerns about Sony's platform being hostile to Xbox. The hearing will continue with PlayStation chief Jim Ryan's pre-recorded video deposition and appearances by Nvidia executives and Activision CEO Bobby Kotick.
• Google is launching a new search feature called "Perspectives" that aims to provide different viewpoints from humans in search results. The feature will display a tab called "Perspectives," where users can find videos, images, and written posts shared on discussion boards, Q&A sites, and social media platforms. This includes content from platforms like TikTok, YouTube, websites, tweets, Quora, and Reddit. The Perspectives feed appears to be Google's attempt to offer diverse human perspectives and reduce reliance on appending "reddit" to search queries.

• YouTube is testing a new gaming product called Playables, which allows users to play online games directly on the platform. The games can be accessed on both mobile and desktop devices through the YouTube website or app. One of the games mentioned is Stack Bounce, an ad-supported arcade game. This move is seen as a way for YouTube to generate additional revenue from the gaming industry, particularly as advertising spending declines.
• Apple is making plans to create dedicated areas within its retail stores to showcase the Vision Pro headset. These spaces will not only provide demonstrations of the device but also allow customers to select the appropriate-sized bands and light seal, which helps block external light from entering the headset. Apple is considering implementing an appointment-based system for purchases, similar to what they did with the original Apple Watch in 2015. Additionally via Mark Gurman: "Some observers at WWDC noticed that the EyeSight feature wasn’t functional on the demo hardware. That stemmed partly from a desire for secrecy: The feature, which helps differentiate the headset from rival models, is one of the most locked-down aspects of the project. Now Apple can expand the number of engineers working on it to ensure that the technology is fully functional for next year’s launch."
• According to anonymous crew members who worked on the upcoming film "Spider-Man: Across the Spider-Verse," the working conditions during the production of the sequel were described as arduous and unsustainable. Four crew members, including artists and production executives, spoke pseudonymously about the challenges they faced, attributing them to producer Phil Lord's management style. They claim that Lord frequently made changes and revisions, leading to a backlog of work and causing approximately 100 artists to leave the project before its completion. The crew members state that the constant changes and revisions affected multiple departments and led to long work hours and wasted effort. They also mentioned that Lord struggled to visualize 3D animation and had difficulty settling on a clear vision for the film. Sony Pictures Animation executives disputed these claims, stating that animation is an iterative process and that the changes were necessary to improve the film. They denied any conflict between Lord and the studio and defended the revisions as part of the normal filmmaking process.

• Rodeo FX has opened a new studio in Paris, France, marking its fifth international location. The company recognizes the importance of the European market and aims to leverage the city's artistic talent and proximity to renowned industry schools. The new studio in the 11th arrondissement will enable Rodeo FX to expand its expertise and provide a wide range of services to artists, clients, and partners. The inauguration of the studio was attended by Mr. Fitzgibbon, Minister of Economy, Innovation and Energy, and other dignitaries, highlighting the collaboration between Quebec and France.
• Roblox has launched the Roblox Partner Program to support brands looking to advertise on its platform. The initiative aims to meet the growing demand from brands following over 100 brand activations on Roblox in 2022. The program will focus on platform education, research and measurement, product and content innovation, and connecting with Immersive Ads, which allows brands to insert programmatic ads into gaming environments. Roblox has partnered with industry figures, including gaming studios, third-party sellers, and agencies, to provide expertise and support to brands.
• Warner Bros. Discovery faced a week of significant challenges, including changes at TCM, disappointing box office results for "The Flash," discussions with Netflix for HBO streaming licenses, speculation about the fate of CNN, talk of a music publishing sale, and a report on cost-cutting. The flurry of news reflects the ongoing transformation and uncertainty following the merger of Discovery and WarnerMedia. Warner Bros. Discovery aims to release quarterly financial results on August 3, providing a clearer picture of its performance since the merger.
• San Diego Comic-Con is facing more setbacks as several major studios and streamers have announced they won't be participating in the convention. Marvel Studios, Disney, Lucasfilm, HBO, Sony Pictures, Universal Pictures, and Netflix are among the companies skipping the event due to the ongoing WGA strike and an upcoming SAG-AFTRA strike, which have limited the availability of talent for panels. Warner Bros. is still undecided but may bring animation titles, while Paramount Pictures will promote its new animated release but has not confirmed panels for its Star Trek shows. San Diego Comic-Con is scheduled for July 19-21.

• According to Phillip Shoemaker, the former head of the App Store Review process at Apple, major improvements to the App Store review process are unlikely to happen unless Phil Schiller, the current chief overseeing it, steps away from his role. Shoemaker believes that automation, similar to Google's approach, could solve the issues of inconsistent rulings and improve efficiency. However, Schiller reportedly insists on human review for every app. Shoemaker suggests that Schiller should step back and allow new leadership. He also discusses the need for clearer guidelines and suggests that Apple's 30% App Store transaction cut may be too high.
• Jacob Devlin, a prominent AI researcher who left Google for rival OpenAI in January, has returned to his former job at Google. Devlin had raised concerns internally about how Google trained its Bard AI chatbot using data from OpenAI's ChatGPT. His departure highlighted a broader disillusionment with Google's AI strategy among employees. The move reflects the intense competition for talent in the AI field as companies and startups race to develop automated text, code, and video production services. Google's decision to rehire Devlin despite the public airing of his complaints underscores the demand for skilled AI researchers.
• Apple has restarted talks with Indian authorities and officials for the launch of its payments service, Apple Pay, in the Indian market. The company is working on a localized version of Apple Pay that will be compatible with the UPI (Unified Payments Interface) platform, a popular payment mode in India. Apple aims to enable iPhone users in India to scan QR codes and initiate UPI transactions without needing to use a separate payment app.

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