I Wonder When the Bubble Will Burst

One of the subtexts of internet media has been repeated indications that the phenomenally detailed and extensive date that they use to sell is complete garbage.

It now appears that one of the central tenets of big data, detailed location data, is, “It’s a Ponzi scheme.”

When juxtaposed with things like Facebook’s bogus pivot to video*, I am increasingly convinced that the entire foundation of the modern internet data economy is complete garbage, where voluminous data serves to obscure rather than to reveal:

Advertisers are scrutinizing their data pools more than ever in programmatic advertising. In the latest installment of Confessions, in which we exchange anonymity for honesty, we spoke to an executive at a location data vendor who said most of what those companies sell is fraudulent.


How much of the location data in the market is fake?
I met with a programmatic leader at one of the agency networks recently who asked my firm to help him verify the location data in the bid stream because they believe up to 80 percent or more of the lat-long data available there is fake. No one has stopped to think about where that data has come from and why a publisher would choose to sell it all to a vendor who is going to build a business on top of their data. What’s actually happening is these ad tech vendors are trying to pad out the limited data they already own with other data sets from competitive vendors or other unknown sources. Most reputable publishers would rather use their data across their own business than sell it to ad tech vendors, as the revenue potential is greater against their own content.

Does the data even work?
Who goes into a shop with their phone in-hand looking at a publisher site? That’s not how people behave when they’re shopping. And yet there are location data vendors who are selling data sets of people who are more likely to go into a shop after seeing an ad. Additionally, there are players in market that are pumping exchanges with this fraudulent data to satisfy demand from advertisers who want to know that someone visited their store after seeing an ad.

Am I the only one who thinks that a vigorous (but fair) enforcement of federal and state fraud statutes would have half of Silicon Valley management in the dock?

*Facebook Overestimated Key Video Metric for Two Years (Wall Street Journal)

Leave a Reply