News brands seek shelter from duopoly in Ozone

Joint advertising platform The Ozone Project, set up by three major newspaper publishers and spanning four national titles, aims to bring a vital sales boost to an ailing market.

When Kylie Minogue, Fatboy Slim and Idris Elba performed at News UK’s chateau at Cannes Lions, the audience included some surprising guests. The publisher of The Sun and The Times invited senior commercial figures from two old rivals, Telegraph Media Group and Guardian News & Media.

It showed how the three newspaper publishers are finally putting their traditional rivalries aside in an effort to improve collaboration, after years of declining ad revenues, with Google and Facebook having sucked up most of the growth.

Earlier that day, Dominic Carter, chief commercial officer of News UK, Dora Michail, digital managing director of Telegraph Media Group, and Hamish Nicklin, chief revenue officer of Guardian News & Media, (alll pictured above) had announced the launch of The Ozone Project in Cannes. The advertising platform will offer joint digital display ad inventory and audience data across their four national newspaper titles for the first time. The idea is that buyers will be able to get access to almost 40 million people in "brandsafe, fraud-free, premium environments" from a single buying point – with first-party, publisherowned data at its heart.

The Ozone Project is a significant move because the UK newspaper industry has struggled for at least two years to find a way to pool ad sales. A series of initiatives, dubbed Project Juno, Rio and then Arena, ran into the ground as talks, which included Daily Mail owner DMGT and Daily Mirror owner Reach, failed to result in an agreement.

"What we learned through all those previous discussions is that advertisers and agencies alike believed that publishers should collaborate more," Carter says, sitting alongside Michail and Nicklin. "They also wanted scale, they wanted data and they wanted ease of buying. The reason we’re very excited about The Ozone Project is we’re answering a lot of the questions asked of us and we’re doing it with the learnings and insights over the last couple of years."

The Ozone Project may be more viable because it is less ambitious – at least in its launch phase. News UK, Telegraph Media Group and Guardian News & Media will each continue to sell its digital ad inventory on a standalone basis as well as offering joint sales through The Ozone Project. Print, multiplatform campaigns and branded content aren’t on the shared agenda.

The three publishers, each of which has an equal stake in The Ozone Project, have recruited an ad tech boss, rather than a news insider, to head the operation. Damon Reeve, an Australian who has previously run ad network Unanimis and technology business OpenX, has been named project lead.

During a joint interview, Carter, Michail and Nicklin sounded enthusiastic but cautious, because it is unfamiliar territory for news brands. They will let Reeve assemble a team and pitch to agencies later in the year but they made it clear that creating "a better ecosystem" for digital advertising is key.

The Ozone Project is about more than just pooling ad sales and audience data. Reeve says it is also about publishers taking more responsibility for ad technology, after years when the supply chain has been dogged by problems around fraud, viewability, measurement and too many intermediaries taking a cut.

As much as 70p of the advertiser’s pound can be gone before it reaches the media owner. Or, as Nicklin puts it, The Ozone Project wants to give programmatic a good name and show how self-serve advertising can be done "properly".

The Ozone Project will invest in what Reeve calls its own "foundational" technology layer, which means the publishers can control how advertising appears on their sites, rather than letting ad tech buyers put tags and other code wherever they like. "The code on page that is currently provided by tech vendors who are also demand partners presents a conflict of interest," Reeve claims. "It is important for publishers to recognise that there’s a point where they should be taking more responsibility than they have been for any code that’s on page."

Setting up their own technology architecture allows the load information for data and ad inventory through that central buying point to be "much more consistent and clean", Reeve adds. Improving transparency will mean that publishers can "understand where value is being created".

Advertisers , meanwhile, should benefit because they will be able to plug in their own data, such as CRM, to target audiences more easily.

The response has been positive. Robin O’Neill, digital trading director at Group M, describes The Ozone Project as "sensible" and "well thought-through". He adds: "From a technical point of view, it’s not complicated."

Emma Cranston, joint head of display and activation at Manning Gottlieb OMD, says: "Combined behavioural data sets appear to be one of the key differences as to why an advertiser would use The Ozone Project over a series of private marketplaces."

The reason we’re very excited about The Ozone Project is we’re answering a lot of the questions asked of usDominic Carter, News UK

She does, however, caution that the initiative is "still in its infancy". She also adds that she thinks that "the success of the venture will come down to measurement – they need to get the pricing right to ensure the performance metrics are competitive".

Douglas McCabe, chief executive of Enders Analysis, which provided advice on Project Juno, says: "The model feels good from the conversations I have had with the publishers and also with some of the agencies. While this alliance does not have a guarantee of success, the sector has to launch these initiatives to have any chance of taking and building market share."

One senior media buyer offers a blunter view, saying that, because news publishers have suffered so much at the hands of the GoogleFacebook duopoly, "They have no choice. They have to do this."

Total ad revenues for national UK newspapers have almost halved from £1.4bn to £750m since 2010, according to Group M. One source estimates that The Ozone Project publishers would be lucky to bring in £100m in digital display between them, while Google and Facebook’s UK revenues run into billions.

The Ozone Project is optimistic that more publishers could come on board (though one rival grumbles about not being invited at the start) and it might go international. "The ambition is not just for the three of us," Michail says. "Other quality publishers can join us."

News publishers may be more willing to collaborate because there is a new generation of leaders who do not come from the world of ink and hot metal. Nicklin used to work at Google. Michail, like her boss, Nick Hugh, chief executive of Telegraph Media Group, came from Yahoo. Even Rebekah Brooks, chief executive of News UK, has fresh eyes after a long absence in the wake of the phone-hacking scandal.

Nicklin dismisses suggestions that the news industry needed outsiders to drive change. "Collaboration has been demanded by the marketplace," he says. If The Ozone Project breathes fresh oxygen into the newspaper advertising market, it will be a lift for a sector that has been starved of good stories – and it could have a greater civic benefit by supporting trusted news.

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