The ‘Chinese Google’ Is Making Big Bucks Using AI to Target Ads

The Chinese web giant now uses deep learning to target ads on its online services, and according to Andrew Ng—who helped launch the deep learning operation at Google and now oversees research and development at Baidu—the company has seen a notable increase in revenue as a result. “It’s used very successfully in advertising,” he says, sitting inside the company’s U.S. R&D center in Sunnyvale, California. “We have not released revenue numbers on the specific impact, but it is significant.”

The salient question is just how much the technology is juicing ad revenues. Though Ng won’t say, a major boost would not be surprising, according to Adam Gibson, a software engineer who aims to bring deep learning algorithms to the wider tech world through a startup called Skymind. Deep learning, he explains, better analyzes data describing how people have responded to digital ads in the past and adjust new ad campaigns accordingly. “Deep learning [is] able to handle more signal for better detection of trends in user behavior,” he says. “Serving ads is basically running a recommendation engine, which deep learning does well.”

via The ‘Chinese Google’ Is Making Big Bucks Using AI to Target Ads | WIRED.

Hidden “Beacons” Were Also Installed In L.A. And Chicago

A BuzzFeed News investigation reveals the quiet spread of Gimbal Inc.’s[bluetooth]  phone-tracking technology in some of America’s largest cities.

The beacons are manufactured by Gimbal Inc., the San Diego company that made the 500 beacons that were removed from New York City phone booths earlier this month

Taken together, the programs reveal a broad initiative by Gimbal to quietly partner with outdoor advertising companies in major American cities.

Although beacons do not collect any information themselves, they play a central role in Gimbal’s phone-tracking technology. Gimbal requires smartphone apps that use its software to get users’ “opt-in” permission before collecting data and sending beacon-triggered notifications. When a Gimbal-enabled, customer-approved app “sees” a Gimbal beacon, the phone sends information about the encounter — including the phone’s “unique identifier”, its location, and the time of day — to Gimbal’s servers.

Gimbal’s apparent strategy — getting hundreds of its beacons placed in high-trafficked public spaces — contrasts markedly with the indoor, retail-focused applications that have dominated beacon-based marketing so far, such as telling a customer in aisle 12 that polo shirts are on sale.

Titan Outdoor Advertising initially said that the beacons it installed in NYC phone booths were only being used for testing and maintenance purposes. In several instances, however, the Gimbal beacons installed in Titan’s phone booths were used for explicitly commercial purposes.

Indeed, a large beacon network seems to be essential to the services the company has marketed to its clients. Gimbal’s “Profile” service, for example, “passively develops a profile of mobile usage and other behaviors” that allow the company to make educated guesses about a user’s demographics (“age, gender, income, ethnicity, education, presence of children”), interests (“sports, cooking, politics, technology, news, investing, etc”), and the “top 20 locations where [the] user spends time (home, work, gym, beach, etc.).” According to Gimbal, the Profile service only operates for users who explicitly “opt in” to it.

via Hidden “Beacons” Were Also Installed In L.A. And Chicago.

They’re Tracking When You Turn Off the Lights

Municipal Sensor Networks Measure Everything From Air Pollution to Pedestrian Traffic; Building ‘a Fitbit for the City’

Hidden on a Brooklyn rooftop, his wide-angle infrared camera peers at windows of thousands of buildings across the East River. The camera detects 800 gradations of light, a sensitivity that lets his software determine what time households turn in, what kind of light bulbs they use, and even what pollutants their buildings emit.
In the coming weeks, the University of Chicago will install dozens of sensor packs on street lamps in the city’s central business district and elsewhere. Each pack, roughly the size of a thick laptop, contains 65 sensors intended to capture data on environmental conditions including sound volume, wind and carbon-dioxide levels, as well as behavioral data such as pedestrian traffic flow as revealed by Wi-Fi-enabled smartphones.

via They’re Tracking When You Turn Off the Lights – WSJ – WSJ.

Sir Martin Sorrell: “The last time I checked, our margins are only 15/16 per cent of revenues…”

“The last time I checked, our margins are only 15/16 per cent of revenues. Last night I checked Facebook and Google and theirs are in the stratosphere – up to between 40 and 50 per cent. What we’re trying to do is act as we have always done in the middle.”

via Sir Martin Sorrell ‘puzzled’ by ongoing programmatic transparency debate | The Drum.

Another take on what the rise of native ads means for the industry

Ben Thompson is a good strategic thinker in the mold of some of the really great tech strategy academics out here.  Here’s his case for why the future for Google’s business is dim: the rise of native ads.  If you’re a long time reader here, it’s the same debate we’ve been having for years. The more aggressive questioning these days is whether brand management has a future in a connected, info symmeetric, real time future.  Maybe the concept of brand management looks entirely different in ten years from now.

However, over the last few years a new type of advertising has emerged: native advertising. I’ve already made my defense of native advertising here, but just to be clear, I classify any sort of “in-stream” advertising as native advertising. Thus, for a news site, native advertising is advertising in article format; for Twitter, native advertising is a promoted tweet; for Facebook, native advertising is ads in your news feed; for Pinterest a future giant a promoted pin. These sorts of ads are proving to be massively more effective and engaging than banner advertisements – as they should be! In every medium except, arguably, newspapers, which had geographic monopolies native advertising is the norm simply because it’s more effective for advertisers and a better experience for users: TV commercials are 30 or 60 second fully produced dramas, magazine ads are highly refined visual experiences, radio ads are jingles, etc. And so it will inevitably go with digital advertising, at least when it comes to brand advertising.

The problem for Google is that there is no obvious reason why they should win this category. Yes, they’re an ad company, but the key to native advertising on the Internet is the capability of producing immersive content within which to place the ad, such as Facebook’s newsfeed, Twitter’s stream, a Pinterest board, or even your typical news site’s home page.

via Peak Google | stratechery by Ben Thompson.