Oracle, once a leader in advertising data, made headlines in June 2024 when it announced the closure of its advertising division, Oracle Advertising. This decision marked the end of Oracle Data Cloud (ODC), which included popular platforms like Datalogix, Grapeshot, Moat, and BlueKai. The company cited misalignment with its current strategic vision as the reason for shutting down its ad business, which had seen a decline in revenue to $300 million in 2024. The closure came as a surprise to both current and former employees, who were blindsided by the announcement shared with investors without prior notice to the ODC team.
The downfall of Oracle’s advertising division can be attributed to various factors, including strategic missteps, regulatory challenges, and internal underfunding. The company failed to keep up with competitors like Adobe and faced setbacks following the Cambridge Analytica scandal and GDPR enforcement. Despite having valuable assets like Moat and Grapeshot, Oracle’s inability to adapt to the changing landscape of the advertising industry ultimately led to its demise.
The closure of Oracle Advertising has created a void in the programmatic advertising market, particularly in sectors like viewability and ad verification where the company held considerable influence. Competition within big tech has led to companies blocking each other from collecting data on their platforms, resulting in Oracle Ads technologies being excluded from these walled gardens. Additionally, the shift in focus towards new mediums like connected TV and podcasts has led to a decrease in the perceived value of viewability data, impacting Oracle’s revenue.
With the closure of Moat, Oracle’s customers now need to seek alternative vendors for crucial services like brand safety and contextual targeting. This presents an opportunity for other adtech companies to attract new clients and expand their market share. The layoffs at Oracle’s advertising division have also made experienced adtech professionals available in the job market, offering opportunities for other companies to strengthen their teams.
Oracle’s decline can be attributed to its heavy reliance on third-party data, which has become obsolete due to stringent data privacy laws. The company’s settlement of a consumer data privacy lawsuit for $115 million highlighted the challenges of operating an advertising business built on outdated business models and processes. Moving towards first-party data and complying with privacy regulations are essential for the success of adtech companies in today’s evolving privacy landscape.
Looking ahead, companies in the advertising industry are focusing on developing innovative solutions that comply with privacy laws and provide value to their clients. The shift towards collecting and using first-party data is evident in light of GDPR and other privacy regulations. Data companies are exploring new technologies like data clean rooms and leveraging machine learning and AI for data analysis. Retail platforms are also becoming key players in the industry, holding valuable data that advertisers and adtech companies can utilize for targeted campaigns.
In conclusion, Oracle’s closure of its advertising division serves as a cautionary tale for adtech companies to prioritize privacy compliance and innovation in their operations. The future of the industry lies in developing new solutions that align with privacy laws and provide value to clients. Advertisers and adtech companies must adapt to the changing landscape of the industry and focus on building privacy-compliant advertising processes to thrive in the evolving market.