May 2 2023 - Ads, AI & Annual Reports

👋Happy Tuesday folks. No fuss, just the news, let's get into it –

Quick Take

• NewFronts kick off with YouTube, TikTok and Amazon taking spotlight
• Spotify cutting audiobook fees to lure authors
• Apple's new 4.15% Savings account is incredibly popular (no surprise)
• Remember when I said Vice wasn't going away (yet)? Yeeeaahhh....
• Earnings today: Uber, Starbucks, Marriott, Pfizer and more

Vice is reportedly preparing to file for bankruptcy after failing to find a buyer, according to sources. The digital-media company, which was valued at $5.7bn in 2017, has struggled to make a profit and has repeatedly laid off staff in recent years. Vice is believed to have attracted interest from at least five companies, but bankruptcy is now the most likely option. If it were to file for bankruptcy, Vice's largest debtholder, Fortress Investment Group, would likely become the company's owner, while Disney and Fox would receive no return on their investment.

YouTube presented new ad formats available across Shorts at the NewFronts presentation in New York. The company is expanding its video reach ads to Shorts using AI to maximize brand reach for a blend of skippable ads and 6-second ads. YouTube is also expanding reach ads to the in-feed environment and Shorts content package for advertisers. The company is adding a slot of inventory that will allow advertisers to purchase the first ad slot a viewer sees when they start a session of scrolling on Shorts. YouTube's Shorts have been gaining momentum, generating 50 billion daily views, and the company made it monetizable for creators via revenue sharing.

TikTok is developing a tool for content creators to disclose whether they used generative artificial intelligence in making their videos, amid concerns about misinformation and copyright battles related to deepfakes. The AI disclosure could be similar to sponsored content labels, although it is unclear whether or how TikTok will enforce the tool. The feature would help the company detect AI-generated videos, some of which are deepfakes that use fake images of real people to cause confusion. Social media platforms such as Facebook and YouTube are also considering how to identify manipulated videos.

Geoffrey Hinton, a pioneer in artificial intelligence, has quit his job at Google and warned of the risks of generative AI. He fears that this technology could lead to misinformation, unemployment, and even pose a threat to humanity. Hinton believes that the race between companies like Google and Microsoft to develop AI systems will escalate without some sort of global regulation, and is concerned that there is no way of knowing whether companies or countries are secretly working on potentially dangerous AI. He urges the world's leading scientists to collaborate on ways of controlling the technology before scaling it up any further. As Hinton says, "It is hard to see how you can prevent the bad actors from using it for bad things."

First Republic Bank, the 14th largest U.S. bank, has been seized by regulators and sold to JPMorgan Chase in an effort to curb a two-month banking crisis. First Republic's assets were battered by the rise in interest rates and the company had struggled to stay alive after two other lenders collapsed in March, spooking depositors and investors. The takeover was announced hours before U.S. markets opened and 84 First Republic branches in eight states reopened as JPMorgan branches. First Republic’s shareholders and debt holders will be wiped out in this deal, a typical occurrence when a bank is put in government receivership. The F.D.I.C. estimated that its insurance fund would have to pay out about $13 billion to cover First Republic’s losses, but depositors will be protected.

Apple's new Apple Card Savings account saw up to $990 million in deposits during the first four days after launch, with $400 million deposited on the first day alone. The account offers a 4.15% APR, with no fees or minimum balance required, and is managed through the Wallet app. Approximately 240,000 accounts had been opened by the end of the first week, which is limited to Apple Card holders.

• IBM CEO Arvind Krishna announced that the company will pause hiring for roles that can be replaced with artificial intelligence and automation in the near future, in an attempt to focus on high-skilled roles. IBM will suspend or slow hiring in back-office functions, which amount to approximately 26,000 workers. Krishna believes that around 30% of those roles could be replaced by AI and automation over a five-year period, leading to the loss of roughly 7,800 jobs. The company is already investing heavily in AI to automate tasks such as employment verification letters and moving employees between departments.
• Microsoft's recent patent filing for "enhanced eye tracking systems" has sparked speculation that the company could be working on a new AR headset. The patent shows a pair of glasses that use a combination of cameras and eye positioning to create a self-calibrating eye-tracking system.

• Adidas is being sued in a class-action lawsuit alleging that the company deceived investors about its former star collaborator Kanye West and the potential harm he could cause the company due to his erratic behavior. The lawsuit accuses Adidas's former CEO and CFO of failing to disclose ongoing issues between the company and Kanye West, and that Adidas was long aware of the potential harm Kanye behavior could cause, but failed to properly limit their financial exposure. Adidas has rejected the claims, and the lawsuit is seeking unspecified damages and the payment of the class action's legal fees.
• Spotify's audiobook creation service, Findaway Voices, will no longer take a 20 percent cut of royalties for titles sold on its platform, as long as the sales are made on Spotify. This move is likely an attempt to attract indie authors from its biggest competitor, Audible, which takes 75 percent of retail sales. Spotify's audiobooks business has a long way to go, but the company plans to launch more features for independent authors in the future.

• Vizio, a leading smart TV manufacturer, has launched a branded content studio to expand its presence in streaming programming. The new business unit is building on the success of its test shows. Vizio Ads will oversee the studio effort and provide advertising inventory on the company's WatchFree+, SmartCast, and TV apps. The new brand studio aims to offer custom, exclusive branded content series.
• BeReal's new feature, RealPeople, is a curated timeline of high-profile users' daily lives, including updates from athletes, artists, and activists. The feed offers a "real unfiltered glimpse" into the lives of notable users and will only be available in the UK at first.

• Snap has hired Patrick Harris, a former Facebook and Meta veteran of 12 years, as Senior Vice President of Partnerships. Harris will lead ad-agency and partnership teams at Snap. The company has also hired David Sommer as Head of Verticals, overseeing the consumer packaged goods vertical for the US. Based in New York, Sommer previously served as the Chief Commercial Officer for shopping app Fetch, after spending nearly 11 years at Meta as Head of Industry for CPG, retail partnerships, and shopper marketing.
• Amazon has announced that it plans to bring over 100 Amazon Original series and movies from Amazon Prime Video to its ad-supported free streaming service Amazon Freevee. The titles will be released throughout the year, the company says, noting this marks the first time marketers will be able to advertise against this group of Amazon Originals, and in a traditional ad format. The shows will be available across devices, including Fire TV.
• Bumble launches new interest badges and prompts related to mental health and self-care, including "Therapy," "Mindfulness," "Deep chat," "Nutrition," "Sleeping well," and "Time offline." The move comes as 55% of respondents say it is important to be open about mental health when connecting with others, and 60% are comfortable talking about it on the first date, according to a survey commissioned by Bumble.

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• Disney uses Ron DeSantis’s own words against him in free speech lawsuit

Also, this.

Preach

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