Since its January debut, the USC Annenberg Innovation Lab Ad Transparency Report has delivered substantial impact while catalyzing an ongoing dialogue across the World Wide Web.
The Ad Transparency Report, a monthly public memo, sets out in part to call attention to the byzantine digital bramble of online ad networks and consumer brands that – intentionally or not – provide revenue to peer-to-peer pirate movie and music websites.
Web goliaths such as Google and Yahoo! have responded to the publication of the Transparency Report by reaching out to the Innovation Lab and working to further explain and even alter how they do business. Ad agencies such as Group M and Omnicom have likewise worked to halt their campaigns from showing up on pirate sites. And major media outlets such as the New York Times, the Guardian and the Los Angeles Times have covered the Transparency Report, as have a slew of niche publications that focus on the advertising, entertainment and file-sharing industries.
"The Report has brought some sunlight to an issue that people weren't concentrating on," Jonathan Taplin says. "It's like any good research report – you look at something that was under a rock and you lift up the rock and see what's underneath. And it wasn't pretty."
Taplin is the USC Annenberg Innovation Lab's director and an USC Annenberg clinical professor. The Innovation Lab brings together experts in a wide range of disciplines from academia, for-profits and other non-profits. The Lab carries a mission "to be a leading innovator and advisor on transformational changes happening in our participatory culture," according to the 'About' text on the Lab's website.
Lab director Taplin's extraordinary career includes stints as Bob Dylan's tour manager; the producer of major motion pictures and television documentaries; a patent-holding CEO; and a Wall Street executive. "The ad business was the least transparent business that I know," Taplin says. "People don't really understand how it works. They don't know who the players are. They don't know how those ads end up on your computer or why it seems like brands are following you around wherever you go."
Previously, that confusion contributed to the difficulty in determining how advertisements from prominent – and less prominent – companies made their way to pirate sites. Occasional gaudy glimpses into that world demonstrated that the connection could be lucrative. Taplin brings up the infamous Megaupload pirate site founder, Kim Dotcom. A report by Google and PRS for Music, mentioned in the initial Innovation Lab Ad Transparency Report, determined that 86% of peer-to-peer pirate sites were advertisement-supported. And this newspaper report notes how a court case revealed how one notorious site was offered $100,000 monthly to post gambling ads.
"It's really an issue of, 'Where is the money in this business?'" Taplin says. "And if the money that paid for all of Kim Dotcom's yachts and his four mansions and everything came from advertising, you don't need a law to stop that. You just need the people in the business to pay some attention and develop a series of best practices."
Each Ad Transparency Report has specified the top ten ad networks that bring the greatest number of ads to pirate sites. The January report placed Openx and Google (including Double Click) in the top two slots as greatest offenders.
That inaugural report was based on a full year's worth of data gleaned from the open source Google Transparency Report. That Google effort makes public near-complete lists of the requests the company receives from copyright holders and their representatives to remove content posted to sites sans approval.
By the time the February Innovation Lab Ad Transparency Report was published, both Openx and Google had dropped out of the top ten. "We've seen radical changes in Google's behavior," Taplin says. "We're beginning to see radical changes in Yahoo's behavior. And Quantcast, another fairly big player, has changed their behavior quite rapidly."
While the initial Ad Transparency Report focused on ad networks, the subsequent two editions have added lists of some of the popular brands and enterprises whose ads Innovation Lab researchers have observed appearing on pirate sites.
These enterprises include the likes of Gucci, IKEA, Pizza Hut, Pottery Barn, Windows 8 and the National Guard and U.S. Army. Taplin says the discovery of the latter pair has so far led to more chatter than any other segment of the March report.
That latest report also steps outside the digital realm for a field trip to meatspace. The report features a large color photograph of two billboards in New York City's Times Square. The billboards are a centerpiece of the "Piracy is Progress" ad campaign by American Eagle Clothing and prominent agency TWBA/Chiat Day.
Taplin calls the campaign counterintuitive and bizarre. "They certainly seem to worry about copyright in terms of people doing knockoff American Eagle apparel," he says of the retailer. "But they don't seem to worry about piracy. It's just completely weird."
Additional editions of the Ad Transparency Report will be published monthly and will be posted to the Innovation Lab website. Taplin also says he'll be heading this month to the White House to further discuss the research.
Why all the effort? What is to be gained – or lost – if the opaque status quo regarding online advertising and the funding of sites that ignore intellectual property rights remained?
"If the money that was flowing into pirate sites flowed back into legitimate sites and they in turn put money back into the content economy, then the people that train at a school like Annenberg, or a school like Cinema, or a school like Music, will be able to make a living," Taplin says.
And if that doesn't happen? "Then they won't be able to make a living," Taplin says. "It's just that simple."
Monthly editions of the USC Annenberg Innovation Lab Ad Transparency Report are posted here.
