Google is playing around with outdoor ads in the U.K., though the company says its plans to sell billboard space there is just an “experiment.”
But Google might be using outdoor ads to help get another part of its business off the ground.
This isn’t Google’s first flirtation with outdoor ads. That honor goes to Sidewalk Labs, the urban technology company owned by Alphabet, Google’s parent company.
Two weeks after its founding in June, Sidewalk made its first move: It was the lead investor in Intersection, a company created by the merger of two smaller ones — Control Group, which makes outdoor digital interfaces, and Titan, which runs outdoor ads. Dan Doctoroff, the chief exec of Sidewalk Labs, is Intersection’s chairman. It turns New York City’s pay phones into Wi-Fi hubs, running off the ad revenue.
While Sidewalk Labs may make some money selling ads, that won’t be its business focus. In fact, few of the Alphabet companies are interested in that. For these moonshots focused on the physical world, the aim — at least internally — is to build businesses that are not dependent on the business that fuels Google.
For Sidewalk Labs, the focus is likely to center on distant bets on aspects of urban life — transit and land use patterns, construction, real estate — that will be upended by tech advancements, particularly ubiquitous sensors and autonomous driving.
In its first five months, Sidewalk Labs has shared little. But last week, Doctoroff, the former New York City deputy mayor, gave a talk at the Municipal Art Society that offered us a hint of its plans. (You can watch the full video here.) The talk, titled “The Shared City,” focused on how new technologies and the sharing economy ethos can enable cities to tackle rising housing costs, quality of life issues and shrinking budgets. One example: Embedded sensors inside buildings that measure noises and smells would render “the terribly crude” zoning and building codes in cities obsolete.
Doctoroff, who was most recently CEO of data and media giant Bloomberg LP, also touched on the seismic changes coming with self-driving cars. Autonomous vehicles, he said, “would likely help to complete the revolution that Zipcar and Uber have started. That is … viewing transportation as a service, rather than as an asset.”
Until self-driving cars arrive en masse, his company may lean on the valuable data in sensing technology as it partners with city governments and private firms. That’s the path thus far of Waze, the navigation app Google acquired. (Waze remains a part of Google proper, for now.) In October, Waze announced that it had added 50 cities to its Connected Citizens program, which swaps data with local governments.
Hence Sidewalk Labs’ proximity to city politicos. Two weeks ago, the Alphabet company became a paying client of Vishaan Chakrabarti, an architect and former city planning official who broke off to start his own firm. Janette Sadik-Khan, the ambitious former transportation director under Mayor Michael Bloomberg, is also consulting with Doctoroff’s company in some capacity, according to multiple sources.
Reps from Sidewalk Labs did not return requests for comment.
In the short term, outdoor ads could pay the company’s bills, but it’s probably a better fit for Google. (As a marketer, Google likes billboards.)
Business Insider first reported that the search giant opened its massive ad platform, DoubleClick, to advertisers that buy outdoor ads (OOH, in the parlance). Google denied the program was anything but a test. A rep sent this response: “OOH snap. This is just an experiment with some media agencies in the U.K. No product is currently in development. Keep on driving.”
Should something move into development, however, it would be an easy way for Google to access more ad dollars. This type of automated ad buying — Business Insider reports that Google used information like weather and local sports scores to serve them — plays on its strengths over ad rival Facebook. Spending on digital outdoor ads is set to hit $2.96 billion this year and grow around 11 percent for the next few, per eMarketer. “Large, growing and digital — all the right boxes Google wants to check,” said Eric Franchi, co-founder of Undertone, a digital ad company that has dabbled in outdoor ads.
Three billion is a decent-sized market. But it pales next to the markets for cars, transportation and real estate — the industries Alphabet companies like Sidewalk Labs are eyeing. Or are likely eyeing. They’ve yet to put their plans on a billboard.
This article originally appeared on Recode.net.