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The ad tech cookie that’s about to crumble

A wave of consolidation in the advertising technology industry will soon eliminate the majority of players in the space. Some of the biggest ad tech companies that went public during the ad tech boom around 2013 now trade in the single digits.

Why this is happening: Ad tech was created to help advertisers save money and create a better user experience, but the market grew too fast for publishers to manage. That led to regulatory fallout (like the General Data Protection Regulation (GDPR) in Europe), the rise of ad blockers, and publisher/advertiser backlash. Also, once media shifted to the smartphone, many ad tech companies that were cookies and targeting-based (works well on desktop, not on mobile) were left in the dust.

Data: Money.Net; Chart: Chris Canipe / Axios

Last week, Sizmek announced plans to acquire Rocket Fuel, for $125.5 million and there are reports that a merger between Taboola and Outbrain is in advanced stages. Earlier this year, Terry Kawaja, founder and CEO of media and technology firm LUMA Partners, said consolidation in the ad tech space will cause 90% of the companies disappear.

Go deeper: Most of this consolidation is occurring in the ad targeting and distribution space. We're now seeing a whole new wave of ad tech companies popping up that specialize in new digital formats, like augmented reality, artificial intelligence and measurement. These companies will inevitably go through the same rise and fall driven by consumption habits. There's always the next best thing!

Steve LeVine 15 hours ago
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Self-driving lab head urges freeze after "nightmare" fatality

Uber self-driving car in Pittsburgh. Photo: Jeff Swensen / Getty

Carmakers and technology companies should freeze their race to field autonomous vehicles because "clearly the technology is not where it needs to be," said Raj Rajkumar, head of Carnegie Mellon University's leading self-driving laboratory.

What he said: Speaking a few hours after a self-driven vehicle ran over and killed a pedestrian in Arizona, Rajkumar said, "This isn't like a bug with your phone. People can get killed. Companies need to take a deep breath. The technology is not there yet. We need to keep people in the loop."

David McCabe 11 hours ago
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Senate committee probes Facebook, Cambridge Analytica

Mark Zuckerberg walks in front of trees
Facebook CEO Mark Zuckerberg. Photo: Drew Angerer/Getty Images

The Senate Commerce Committee is sending written questions to Cambridge Analytica's parent company and Facebook about the revelation that the data consulting firm improperly gathered user data from the social giant.

Why it matters: This is the most aggressive action by Republicans yet to investigate the reports about the Trump-linked analytics firm.

Quote“They’ve got responsibility to make sure that that information is used in an appropriate way, so we want to find out how it was gotten, how it was used, and we want Facebook obviously to be transparent about that.”
— Sen. John Thune