Illustration: Rebecca Zisser/Axios

Tech companies are launching ad businesses to eat at the multi-billion dollar advertising pie dominated by Google and Facebook for the past few years.

The big picture: Other tech giants, like Apple and Amazon, are doing all they can to eat away at the duopoly — at the expense of traditional advertising giants in the media business.

  • Apple is reportedly in talks with Snapchat, Pinterest and other companies about participating in an Apple network that would distribute ads across their collective apps, the Wall Street Journal reports.
  • Amazon reported over $2 billion in mostly digital advertising sales for the first quarter of the year. The retail giant is expected to grow its ad business faster than any other tech company, according to eMarketer.
  • Microsoft is expected to make over $4 billion in advertising revenue this year, more than a quarter of all U.S. newspaper ad revenue. Its uptick in advertising growth is fueled largely by the acquisition of professional networking site Linkedin and its search site, Bing.
  • Roku, as Axios reported last month, is quietly building a large software business, driven mostly by advertising revenue. And that software business is now bringing in more revenue than its signature hardware product.
  • B2B tech companies like Oracle, Adobe and Salesforce are all using cloud technologies to collect data that can be used to better target advertising. Oracle and Salesforce acquired two major ad tech companies to aid their efforts, Moat and Krux, respectively.

The irony: Many of the tech companies began with an aversion to advertising, fearing it would be a disruption towards the consumer experience.

  • Google founders initially warned in 1998 that advertising-based search engines were “inherently biased towards the advertisers and away from the needs of consumers.”
  • Facebook CEO Mark Zuckerberg reportedly only accepted advertising on his platform initially so he could pay the bills.
  • Apple has historically valued user privacy above all else, stifling its previous attempts into the ad business
  • Snapchat boss Evan Spiegel initially criticized some targeted ads as "creepy," but four years later, 90% of the ads sold on Snap's platform are sold in an automated fashion.

Some publishers are banding together to offer marketers to cheaper advertising against traditional media content at scale.

  • A bunch of digital websites, from Quartz to New York Media to PopSugar and Rolling Stone are all joining Concert, a digital advertising marketplace operated by Vox Media in conjunction with NBCUniversal, with the goal of combating tech giants' ad dominance collectively.
  • Murdoch-owned News Corp. launched a global digital ad network earlier this year called News IQ, which will pull audience data from sites like The Wall Street Journal, New York Post and Barron's and give advertisers a way to reach specific audiences around safe content.
  • AT&T is hoping to create a similar type of ad network via its partnership with Time Warner. Sources say the ad network could eventually bring on other media and technology partners, similar to Concert.
  • Disney and Verizon with Oath have also taken similar steps to build their own ad networks.

Yes, but: Even those efforts will be hard to knock the massive leadtechnology companies have over legacy media in advertising.

The bigger picture: It's not just tech firms, but retail and consumer package goods companies, too. Ad-serving has become so democratized that any company with an audience is now able to steal advertising dollars away from traditional media companies. Kroger has an ad business and so does its grocery rival Albertsons. Target has a media network and so does Walmart.

Go deeper

Caitlin Owens, author of Vitals
11 mins ago - Health

The coronavirus is starting to crush some hospitals

Illustration: Aïda Amer/Axios

Some states are seeing dangerous levels of coronavirus hospitalizations, with hospitals warning that they could soon become overwhelmed if no action is taken to slow the spread.

Why it matters: Patients can only receive good care if there's enough care to go around — which is one reason why the death rate was so much higher in the spring, some experts say.

Scoop: The Lincoln Project is becoming a media business

Illustration: Eniola Odetunde/Axios

The Lincoln Project is looking to beef up its media business after the election, sources tell Axios.

Driving the news: The group recently signed with the United Talent Agency (UTA) to help build out Lincoln Media and is weighing offers from different television studios, podcast networks and book publishers.

Trump, Biden strategies revealed in final ad push

Data: Bully Pulpit Interactive; Chart: Danielle Alberti/Axios

President Trump is pouring hundreds of thousands of dollars into Facebook ads on the Supreme Court and conservative judges in the final stretch of his campaign, while Joe Biden is spending over a million on voter mobilization, according to an analysis by Axios using data from Bully Pulpit Interactive.

The big picture: Trump's Facebook ad messaging has fluctuated dramatically in conjunction with the news cycle throughout his campaign, while Biden's messaging has been much more consistent, focusing primarily on health care and the economy.