Designing
New Context
Designing
New Context
| What role should digital advertising play and how must it be transformed in today’s online environment that is overrun with malicious media, including fake news and fraudulent articles written with generative artificial intelligence (AI)? This series examines these issues and looks toward the future via interviews with members of the Quality Media Consortium, which was founded by advertising and media companies striving to build a healthy media environment. |
Based on the current state of the online ad market, Hiroaki Takita (president of Toyo Keizai Inc.) and Hideyuki Nagasawa (special advisor of BI.Garage) warn that we are at a critical moment for democracy. Companies are unknowingly placing ads in poor-quality media due to multiple factories in the online advertising ecosystem, and media outlets dedicated to serious journalism are losing their influence.
BI.Garage is a member of the Digital Garage Group that develops and sells cutting-edge online advertising technologies. To help change this environment, in October 2023 it founded the Quality Media Consortium of 30 media companies, and the consortium has released its Quality Media Declaration. Chairman Takita and Secretary-General Nagasawa discussed the background of these issues and their future vision for a healthy media environment.
president, Toyo Keizai Inc.
Hiroaki Takita
Started working at Toyo Keizai Inc. in 1985. Past positions include Venture Club editor (1999); Japan Company Handbook editor (2005); director and chief editor (2011); managing director (2016); managing director, Business Promotion Office head, and Digital Business Division head (2018); and senior managing director (2020). Was appointed to his current position in December 2022. Commentator on Gacchiri Monday!! (TBS; 7:30 – 8:00 a.m., Sunday; appeared on the annual ”We Took the Company Public” special program).
special advisor; BI.Garage, Inc.
Hideyuki Nagasawa
Joined DENTSU INC. in 1977 and served as head of the Digital Planning Department, Newspaper Bureau. Became head of Dentsu’s Interactive Communication Bureau in 2004, president and CEO of Cyber Communications Inc.（Current CARTA COMMUNICATIONS Inc.） in 2006, and executive director of the Japan Interactive Advertising Association in 2014. Has been a special advisor of Digital Garage, Inc. since 2017, and director of BI.Garage, Inc. since 2020. Is Secretary-General of the Quality Media Consortium comprised of 30 Japanese media companies, where he promotes digital advertising leveraging the value of media outlets that produce their own content.
Takita: To define the Internet, we can say it’s humankind’s first method for disseminating information to individuals. In that way, I think it’s far surpassed the Industrial Revolution. Media companies spend money to produce content, but the widespread use of the Internet has created a world where this content is treated on equal footing with armchair journalism, “fake news,” and the like. I expected this, but the actual situation is much worse than I imagined.
Nagasawa: Speaking from the standpoint of an ad agency, media companies that spend money to create content, like those Takita mentioned, are not properly valued in the online ad market. This is because clicks are given priority in online advertising. It’s a different metric than mass media ratings, or newspaper or magazine circulation. It doesn’t matter how many times an ad is viewed in a digital media; it only works if it receives clicks. In other words, looking at the structures of online ad platforms, there is no interest in the quality of content and media, or in ethical considerations. The most important thing is displaying ads.
Nagasawa: I worked at Dentsu a decade ago. Thinking back to that era, online ads were sold the same way as those in mass media outlets like newspapers and TV programs. Things changed when Google and Facebook emerged, leading to the advent of mechanical, programmatic advertising. Today people talk about the “attention economy,” in which advertising follows the principle that content is valued for its ability to draw user interest. It doesn’t matter if the content is immoral, scandalous, or of inferior quality.
Furthermore, some advertisers don’t care where their ads are displayed, as long as people see them. They use cookies for behavioral targeting. Online ads are shown on hundreds or thousands of websites according to this principle. With this method, it doesn’t matter what 99.9% of users think, as long as 0.1% of them click on the ad. This overturns the past philosophy of mass media advertising, and it treats users with contempt. There is no consideration of user interests or preferences, which I feel shows a decline in morals.
Nagasawa: If nothing is done to change this, I thought it would be impossible for companies to maintain high-quality content cycles with their advertising expenditures. Of course ad quality is important, but the true value of advertising is only demonstrated when ads are run in high-quality mediums. In our Quality Media Declaration, we state that “good advertising exists within good content.” This is absolutely true; good media outlets must have good content, and good media draws loyal users (readers).
Trustworthy media companies like Toyo Keizai spend a great deal of time and effort gathering information. They obtain supporting evidence, edit their articles, and proofread them before they are published. They also share their own opinions. Users highly appraise this content, including ads. I think high-quality media companies will be in a predicament unless there are standards for evaluating these ecosystems.
I expect we will see increasing numbers of fake news articles and ads, including those written with generative AI. In that type of society, what guidelines should we use to evaluate information? The answer is certainly not ad page views. Society should value content based on sufficient information gathering, which is the true role of journalism. And if journalism does not function properly, democratic society will become unstable.
Takita: You mentioned democracy, which I think is an extremely important point. I hope readers will realize that journalism is a necessary expense for a democratic society. If they want democracy to be sustained, we need media companies that will invest in journalism, like those in the consortium. Toyo Keizai has about 100 reporters and does everything in-house. Our employees engage in reporting and interviews based on an understanding of the company’s philosophy. We scrutinize each article to see if its phrasing is appropriate. It’s a fact that journalism does cost a fair amount of money.
In democratic nations, citizens consume information published by media companies that pay these expenses. Citizens make suitable judgments and act accordingly. I think this process leads to a happier society. Journalism is banned in Russia, North Korea, and other autocratic nations. People who disagree with this premise might think the Quality Media Consortium members are getting stirred up about nothing. However, high-quality media exists in healthy societies. These expenses are an essential part of democracy, and they bring worthwhile benefits.
On a somewhat related topic, last year we published a Japanese version of How Civil Wars Start: And How to Stop Them, written by Barbara F. Walter and translated by Yasushi Isaka. Walter, a prominent American political scientist, spent 20 years doing thorough research and historical analyses to create her polity index, a scale from -10 to +10. Negative numbers indicate how close a country is to autocracy, and positive numbers express their level of democracy. Insurrections and civil wars do not take place in countries at either extreme. Countries with negative scores include Russia and North Korea, and countries with positive rankings include Canada, New Zealand, Norway and other Northern European states. The United States had a similar ranking until a few years ago, but its score was lowered to +5 due to factors like the Donald Trump presidency, QAnon movement, and unprecedented Capitol attack. This means the U.S. is neither a democracy nor an autocracy, putting it in the zone with the highest risk of civil war.
America’s revised score includes politicians and other multiple, complex factors, but I also think there are impacts from the Internet and social media. In particular, social media users only view what they want to see. Localized, fragmented information creates isolated bubbles where users no longer entertain different worldviews. I’ve heard some Americans don’t talk to their family members according to whether they are Democrats or Republicans. I feel like Japan is going down the same road. Although Japan isn’t in as much danger as the U.S. and may not be the site of insurrections, I think individual freedom is being gradually eroded, and I worry that democracy is crumbling.
It sounds a bit grandiose, but the work we are doing today may help protect democracy. I won’t make the overblown claim that we can prevent civil war, but the 30 Quality Media Consortium companies play an essential role in safeguarding Japanese democracy and maintaining a society where everyone can act and live freely. I’m not saying that we don’t need other types of media, but I hope readers will understand that our 30 members are doing business based on this sense of crisis.
* Takita and Nagasawa discuss ad strategies to protect brand value in Part 2, which will be posted at a later date.
Jointly administered by 30 leading media companies, this organization was founded by BI.Garage to improve the quality of Japanese digital advertising. It is the only ad network that works to provide the highest-quality advertisements by focusing on the quality of ads and the mediums where they are delivered.
＊Quality Media Declaration
