What a difference a week can make. Threads, Meta’s rival to Twitter, launched just over a week ago and has garnered a staggering >100m sign-ups, surpassing ChatGPT as the fastest-growing online platform. Shortly after Threads' debut, the first advertisement appeared on the platform. Hulu, the sponsor of the first branded content, recognized the strong growth momentum and reacted swiftly. Amid Twitter's ongoing issues, especially regarding brand safety, brands are eager to leverage Threads' potential. Another company which wasted no time and hopped on the bandwagon is LBG Media. It launch a fun 'Threads vs. Twitter' meme series on day one. LBG is attracting many followers on the new platform, with a few of its brands already surpassing their Twitter follower count. Despite Meta's silence on monetising Threads, the future looks promising. Elsewhere, in contrast to industry trends, strong advertising growth in digital has been reported by the Guardian US. The business is experiencing momentum in direct digital advertising, capitalising on brands' flight to quality. Their focus on direct advertising and diversification away from programmatic is paying off in the US. In other news, the FTC has opened an investigation into ChatGPT over privacy and harmful content concerns, Hipgnosis is considering selling assets, and two independent agencies are joining global holding companies.
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The first Threads advertisement The first advertisement was spotted on Threads just a few days after its launch. It was a sponsored post by creator Adam Rose for Hulu’s Futurama series, with a #HuluPartners hashtag. This post has received hundreds of interactions since its publication. According to Hulu, it launched this ad as they saw strong initial momentum and plans to continue testing advertisements on this new platform. Threads amassed 100m users in less than a week, which has caught the eyes of brands and publishers. It is unclear how Meta will monetise this new platform, but the early appearance of the first ad demonstrates its potential for branded content. One of the quick movers is Ladbible, who has posted a series of memes featuring ‘Threads vs. Twitter’ right after Threads’ launch, which attracted very strong engagement. Instagram’s seamless followers’ transition supported Ladbible’s good start with this new platform, with both Unilad and Gamingbible already gaining more followers on Threads than Twitter. So far, Ladbible is posting regularly every half an hour and intends to keep the content on Threads light and fun, while avoiding content repetition. It is still early days but Ladbible will adapt its strategy as Threads evolves. Digiday, Adage
Guardian US bucking the trend with advertising growth Guardian US. saw a rise in advertising revenue in 1Q of its fiscal year (Mar YE), which is April to June, despite headwinds seen in the digital advertising sector. This continues the strong growth of 40% achieved in FY23. The publisher does not use a paywall and relies on advertising and reader support, each contributing 50% of its total revenue. The publisher says it is seeing a flight to quality as brands shift their marketing budgets when time is tough. More importantly, the Guardian believes that it could buck the trend because of its successful advertising strategy. It focuses on direct advertising, which provides clients with custom content offerings, rather than programmatic advertising which is more cyclical and suffers from yield declines recently. It has improved its revenue mix this year, with only 40% (50% last year) advertising revenue coming from open market programmatic and 60% from direct advertising. This is also supported by its increased volume of its self-produced branded content materials. Currently it has no revenues generated from affiliate marketing or events. Adweek
FTC initiates official investigation on ChatGPT The Federal Trade Commission (FTC) is officially investigating the risks associated with AI chatbots, focusing on OpenAI, the creator of ChatGPT. FTC is examining whether OpenAI has engaged in ‘unfair or deceptive’ privacy and data security practices. The regulator is also concerned about the vast amount of personal data consumed by AI technology and its potential harmful outputs, such as misinformation and offensive comments. Lina Khan, the FTC chair, highlighted the necessity of this investigation. She expressed concerns about AI services like ChatGPT being fed large amounts of data without checks on the data inserted, which led to incidents such as sensitive information appearing in responses to unrelated inquiries. Sam Altman, OpenAI's CEO, expressed disappointment over the FTC's investigation starting with a leak, stating it doesn't help to build trust, however assured cooperation. In response to the FTC’s concerns, he emphasized that they are confident in their legal compliance and that their systems are designed to learn about the world rather than individuals. In March, Italy's privacy watchdog temporarily banned ChatGPT due to similar concerns. However, the ban was lifted after OpenAI made its privacy policy more accessible and introduced an age-verifying tool. FT
Hipgnosis considers sale of music rights to boost share price Hipgnosis Songs Fund, a UK-based company that owns the rights to music by artists like Neil Young and Nirvana, is considering divesting some of its music catalogues. The company aims to narrow the gap between its share price and its asset value. According to the company's CEO, the current share price undervalues the company and he is currently discussing various options with the board and key shareholders to boost the company's value. A new strategy is expected in August ahead of a shareholder vote to decide the fate of the fund. However, the company also cautioned that divesting music catalogues could incur a tax charge and the company could face a corporation tax charge of up to £245 million if all music assets were divested. The company is trading at a market value of about £892 million, which is roughly half of its net asset value. FT
Havas acquires majority stake in creative agency Uncommon Uncommon has sold a majority 51% stake to Vivendi-owned Havas, valuing the agency at a potential £120m. This valuation means Uncommon could become one of the most successful agency start-up since Adam&Eve/DDB, now part of Omnicom. Uncommon’s three founders, previously from WPP’s Grey, own close to 90% of the shares which will reduce to 49% after the deal. Uncommon is an award winning UK creative agency which has 169 staff, 45 accounts and doubled its annual income to £22m by the end of 2022. With existing US clients, the agency plans to expand its footprint in the region. Its New York Office is set to open in the coming months, and this deal could further drive Uncommon’s growth in the US and beyond. Uncommon has turned down some potential deals before due to concerns over offer dilution and drag on growth. However, both companies said it’s not the case this time and the agency will continue to operate separately from the group’s creative network with high level of autonomy and control. Also this week, Omnicom acquired Ptarmigan Media, a UK-based agency with expertise in financial services. The transaction value was not revealed. Campaign, Campaign
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