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At the Code Conference this week, AT&T CEO Randall Stephenson spoke about the company’s currently blocked acquisition of Time Warner. But Stephenson also explicitly revealed one reason why AT&T wants to buy the cable company in the first place.
“(Time Warner) has an amazing inventory of advertising that they just kind of sell broadly. It’s not a very targeted approach,” Stephenson said. You can view the full interview on YouTube, but it can be summarized in the following way: AT&T wants to leverage the “amazing amount” of data that it already collects on its customers to serve up targeted ads on Time Warner content.
For context, AT&T collects a massive amount of data on its customers. In Stephenson’s own words, it ranges from the type of content users view to the exact location of their smartphones.
It’s not an unheard-of strategy, either. Verizon did something similar when it bought Yahoo and AOL last year, The Verge reported in April 2017. Among other types of data, Verizon uses cookies to track every website a user visits, as well as the location of their devices.
It’s pretty clear where AT&T and Verizon might be headed. As even more evidence of that, Stephenson also responded to a question about going “toe-to-toe” with Silicon Valley.
“I believe if you don’t create a pure vertically integrated capability from distribution all the way through content creation and advertising models you’re going to have a hard time competing with these guys,” Stephenson said.
“These guys,” of course, refers to the existing tech juggernauts. Together, Facebook and Google make up nearly 100 percent of digital ad spending. To compete with tech firms in the digital era, adopting their methods seems to be the dominant strategy for telcos.
All of this is pretty terrible from a data privacy standpoint. That’s especially true since the U.S. telecom market is so consolidated, with few choices for consumers. In other words, we may be barreling toward a targeted ad dystopia — one in which being tracked for ads is just the cost of having cell service.
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