By Jack Nicas
A week after Google apologized for running customers'
advertisements alongside objectionable videos, triggering a change
in policy, its YouTube site is still rife with examples that are
angering more big advertisers and causing some to cut spending with
the tech giant.
Google's automated system placed ads for some of the world's
biggest brands -- including Coca-Cola Co., Procter & Gamble,
Amazon.com Inc. and Microsoft Corp. -- on five YouTube videos
peddling racist and anti-Semitic content, according to a review by
The Wall Street Journal.
Asked about the Journal's finding that their ads were still
appearing with such content on YouTube as of Thursday night,
Coca-Cola, PepsiCo Inc., Wal-Mart Stores Inc. and Dish Network
Corp. said Friday they were suspending spending on all Google
advertising except targeted search ads. Starbucks Corp. and General
Motors Co. said they were pulling their ads from YouTube. FX
Networks, part of 21st Century Fox Inc., said it was suspending all
advertising spending on Google, including search ads and
YouTube.
Wal-Mart said: "The content with which we are being associated
is appalling and completely against our company values."
Other companies whose spots appeared, including Toyota Motor
Corp. and Microsoft, said they were monitoring the situation.
Procter & Gamble said it was working with Google but declined
to say whether it was reducing spending.
The examples show how Google, the world's largest advertising
platform, is struggling to keep its clients' ads away from
questionable content, at least in the near term as it works on
solutions. The cancellations by many of the biggest U.S.
advertisers could dent revenue for Google, a unit of Alphabet
Inc.
Google "had assured us over the past few days that our brands
were safe from this type of content," said an executive at one of
the affected companies. "Despite their assurances, it's clear they
couldn't give assurance."
A Google spokeswoman on Friday reiterated the company's
statement from earlier in the week that it is improving its
policies and enforcement to better police content, pull more ads
from "hateful, offensive and derogatory" videos, and give
advertisers more control over where their ads appear. Google has
already begun some of those steps, the spokeswoman said, including
strengthening technology to automatically screen videos and adding
more reviewers to pull ads from problematic videos and websites.
However, she acknowledged imperfections in the software.
Google removed four of the five videos flagged by the Journal
and pulled ads from the fifth.
The ease with which journalists have been able to find top
brands' ads on controversial videos suggests Google is still
failing to catch some of the most obvious examples.
Ads for Coca-Cola, Starbucks, Toyota, Dish Network, Berkshire
Hathaway Inc.'s Geico unit and Google's own YouTube Red
subscription service appeared on racist videos with the slur
"n-----" in the title as of Thursday night. Those ads ran before
two videos that dub a racist song over videos of former first lady
Michelle Obama or Chicago rapper Chief Keef. The videos, posted by
the same account, have been viewed more than 425,000 times and
260,000 times, respectively.
Another video titled "Black people in their natural habitat,"
with a racial slur in the description, played monkey noises over
footage of black men in prison and images of black civil-rights
leaders Malcolm X and Martin Luther King Jr. Google showed ads for
Amazon, Microsoft and GM's Chevrolet unit before or during that
video.
The companies that cut spending -- Wal-Mart, Starbucks, PepsiCo,
Coca-Cola, Dish, GM and FX -- said that they were concerned their
ads appeared on such videos and that they would suspend advertising
until Google proves such an incident wouldn't happen again.
Amazon and Geico didn't immediately respond to requests for
comment.
Google has said it uses software to automatically screen videos'
titles, descriptions, images and dozens of other signals to prevent
ads from appearing on inappropriate content. But the software has
been imperfect. It has pulled ads from innocuous content, allowed
ads that violate Google's existing policies, and can miss context
or nuance.
Google said Friday that imperfection in the software led to ads
appearing on videos with racial slurs in the titles and
descriptions. The company said the software doesn't automatically
remove ads from every video with "n-----" in the title, for
instance, because it fears that could unfairly punish acceptable
content, such as documentaries or music videos.
The ads found by the Journal are among a string of examples
identified by news organizations in recent days -- each report
prompting advertisers to cut advertising spending with Google. On
Wednesday, AT&T Inc., Verizon Communications Inc., Johnson
& Johnson and other firms suspended some advertising with
Google after the Times of London showed them images of their ads
appearing alongside YouTube videos supporting terrorists, following
an investigation that focused on ads shown in the U.K.
Google has likely been showing major brands' ads alongside
questionable content for years. But the media's public airing of
the issue prompted advertisers to pull spending and forced Google
to make changes.
A Journal reporter, checking YouTube videos peddling
conspiracies and racist views over the course of roughly five hours
Thursday evening, found ads from major brands running on about 20
videos filled with racial slurs, hateful titles, or other content
that appears to violate Google's existing standards.
Google showed ads for PepsiCo's Quaker Foods unit, Microsoft's
Minecraft videogame and FX Networks' "Fargo" on a 15-minute video
titled "EXPOSING THE JEWISH LIES." The video showed a sermon from
Steven Anderson, the founder of the Faithful Word Baptist Church in
Arizona, which the Southern Poverty Law Center has deemed a hate
group for promoting views that the Holocaust was a hoax and gay
people should be killed. Faithful Word didn't immediately respond
to a request for comment.
When companies' ads appear on questionable sites or videos, it
doesn't only potentially muddy their brands, it also funds the
purveyors of such hate speech, misinformation or other unsavory
content. Each time a user watches the entirety of an ad Google has
placed before a YouTube video, the advertisers pay a small fee that
is split between the video's creator and Google. YouTube charges an
advertiser roughly $7 to $12 per 1,000 ad views on average,
depending on the targeted audience, advertisers say. YouTube's
immense scale -- it recently said users watch more than 1 billion
hours of videos a day -- helps it earn billions of dollars a year
on such ads, analysts estimate.
While Google's main moneymaker, internet search ads, has been
largely insulated from the controversy, the financial impact for
the company continues to grow as major advertisers freeze their
spending on important revenue sources for the company. Placing ads
on third-party websites brought in revenue of $15.6 billion last
year, or 17.3% of Alphabet's overall revenue. Alphabet doesn't
disclose YouTube's revenue, but has signaled it has been a major
driver of growth in recent quarters.
FX Networks appears to be the first brand to freeze spending on
search ads, though it is a tiny customer of that business for
Google. 21st Century Fox and News Corp., parent company of the
Journal, share common ownership.
"Currently, the advertising industry has a challenge related to
filtering and controlling contextual placement," a Microsoft
spokesman said. The company said its ad buying guidelines "preclude
placement in or near offensive content."
But Microsoft and several others didn't immediately pull their
Google spending, unlike PepsiCo and Wal-Mart.
"Toyota is aware of public comments by Google promising to deal
with this matter, and, as such, have not yet suspended our
advertising, although we are watching the situation closely," said
a Toyota spokesperson. Toyota has suspended some of its advertising
on YouTube in the U.K.
Procter & Gamble, the world's largest advertising spender,
said it would make "changes if we find our ads appearing within a
context that does not comply with our guidelines or business
ethics." It said it would not comment on its plans specifically
with Google, which showed an ad for P&G's Crest brand before a
video titled "A 6000 Year History Of The Jew World Order." That was
the only video of five flagged by the Journal that YouTube didn't
remove from its site.
Brands' ads show up on such videos in part because of the
complex automated ad-buying system that underpins much of online
advertising. Advertisers tell Google which audiences they aim to
reach, such as teenage males who like videogames, and Google
delivers their ads to those users as they browse across its
millions of YouTube videos and the more than 2 million websites in
its ad network. Complicating Google's job of policing content is
the sheer size of YouTube and its ad network, as well as the nuance
often required to determine what content is objectionable,
according to advertising and tech executives.
--Jennifer Maloney, Sarah Nassauer and Sharon Terlep contributed
to this article.
Write to Jack Nicas at jack.nicas@wsj.com
(END) Dow Jones Newswires
March 24, 2017 17:32 ET (21:32 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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