More US companies suspend ads on YouTube over "offensive content"

The announcement came after the United Kingdom government and the Guardian newspaper stepped up pressure on YouTube to police content on its platform, pulling ads from the video site because they appeared beside clips they view as inappropriate.

According to USA Today, AT&T is halting all ad spending on Google except for search ads, which means their ads will not run on YouTube or two million websites that participate in Google's ad network.

On Wednesday, The Wall Street Journal said the ad cuts may expand past YouTube, covering "much of their advertising from Google". Google needs to strike a balance between pleasing advertisers and those who upload videos to YouTube and are free to take their creations elsewhere if unsatisfied with their shares of ad revenue.

"A cascade of major brand boycotts for Google ad spend (mostly non-search) has emerged, raising concerns on first quarter and second quarter results and the future of programmatic advertising", Justin Post, an analyst with Bank of America Merrill Lynch, wrote in a research note on Thursday, referencing the automated software Google uses to match advertisers with content online.

Havas, the world's sixth-largest advertising and marketing firm, also took down its United Kingdom clients' ads from Google's display ad network and YouTube, reported Bloomberg. "A dearth of trust and a need for verification lie at the heart of these problems", he said. And it was freakish to see an ocean of news outlets just skip over the fact that both companies are pushing hard into advertising themselves with completed or looming acquisitions of Time Warner, AOL and Yahoo. "We will continue to take every measure to ensure our brand advertising is consistent with our brand values".

And Google already has some protections in place for companies that are anxious about brand safety, such as its Google Preferred feature, which allows advertisers to choose a subset of content partners to associate with, Hargreaves said. Most outlets were quick to malign Google for purposely letting extremist content get posted, ignoring the fact that the sheer volume of video content uploaded to YouTube on a daily basis makes hateful-idiot policing a Sisyphean task.

However, the three American companies move to stop ads will not extend to search ads.

An investigation by The Times in the United Kingdom found that companies, university and nonprofits had their ads appear on hate websites and YouTube videos created by supporters of terror groups such as the Islamic State.

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Google rivals such as Facebook could also benefit if they prove safer havens for digital advertising.

Brands have removed their ads from YouTube - which is owned by Google - after learning that their commercials were appearing next to videos promoting Islamic terrorism, white supremacy and other forms of violent bigotry.

In the current heated climate, a lack of guarantees is probably not what brands and advertisers want to hear coming from Google.

Despite the fact that Google's policy changes likely won't meet all the desires of advertisers, their agencies saythere's some progress.

That hasn't mollified the concerns for several major advertisers. In the fourth quarter of previous year, the company generated 85 percent of its total revenue from ad that generated $22.4 billion.

Still, the recent controversy's impact on Google isn't a hit to revenue, but a hit to reputation, as reflected in a recent drop in parent company Alphabet's stock.

Rajan Anandan, Vice-President and Managing Director, South-East Asia and India, Google, told BusinessLine that the company is set to give brands more control over where their ads appear, and that the company itself has a rigorous brand-safety policy in place.

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