Morning Brew Daily
Meta’s Fact-Check Overhaul Scares Advertisers & Delta Teases Gambling Mid-Flight?
Mon, 13 Jan 2025
Episode 495: Neal and Toby discuss Meta’s recent overhaul of its policies that have sent shockwaves throughout, particularly with its main advertisers expressing concerns on its new free-speech direction. Then, JPMorgan wants staff to return to office 5 days a week and not everyone is happy about it. Plus, the December jobs report shows a hot labor market which has curtailed hopes of a near Fed rate cut. Meanwhile, Delta and robot vacuums are the weekend’s winners. Lastly, a preview of what’s coming in the week ahead. Subscribe to Morning Brew Daily for more of the news you need to start your day. Share the show with a friend, and leave us a review on your favorite podcast app. Checkout public.com/morningbrew for more Listen to Morning Brew Daily Here: https://link.chtbl.com/MBD Watch Morning Brew Daily Here: https://www.youtube.com/@MorningBrewDailyShow All investing involves the risk of loss, including loss of principal. Brokerage services for US-listed, registered securities, options and bonds in a self-directed account are offered by Public Investing, Inc., member FINRA & SIPC. Alpha is an AI research tool powered by GPT-4. Alpha is experimental and may generate inaccurate responses. Output from Alpha should not be construed as investment research or recommendations, and should not serve as the basis for any investment decision. Public makes no warranties about its accuracy, completeness, quality, or timeliness of any Alpha out. Please independently evaluate and verify any such output for your own use case. *Terms and Conditions apply. 00:00 - LA Wildfire Update 03:15 - Meta Advertiser Concerns 08:10 - JPMorgan Return to Office 11:50 - December Jobs Report 17:45 - Winners of the Weekend 24:30 - Week Ahead Learn more about your ad choices. Visit megaphone.fm/adchoices
Chapter 1: What concerns do advertisers have about Meta's new policies?
Then Midtown's sweet green restaurants rejoice. J.P. Morgan has called every one of its 300,000-plus employees back to the office. It's Monday, January 13th. Let's ride.
We'll be right back. The death toll increased to 24 and is expected to rise, authorities said. The weather is not looking good for firefighting earlier this week, with at least two heavy blasts of Santa Ana winds expected. But later in the week, the winds are projected to calm down and remain low for the weekend.
Also, if you've been on social media, you've no doubt seen some of the aerial firefighting efforts going on, both from the smaller Nimbler helicopters and the bigger so-called super scooper planes that are swooping in to douse parts of the blaze. Those iconic water bomber planes are actually here on loan from Canada as part of a longstanding agreement between the Canadian and U.S.
governments to kind of share aid when fighting, uh, wild fighters. Right now there are two planes in LA being flown by rotation of eight Canadian pilots. Two more are getting folded into the rotation this week, which is good too, because the FBI is currently investigating incident where one of the super scoopers hit a civilian drone damaging it.
So hopefully that can get back up in the air soon because seeing these super scoopers in action is, It is pretty remarkable to see just how nimble the pilots can be and how accurate they can be when trying to fight these fires. Now a word from our sponsor, Public.com.
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Chapter 2: What is JPMorgan's new return-to-office policy?
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Mark Zuckerberg's makeover of meta for the Trump era took a surprise and dramatic turn last week when the CEO said his company would end its use of third-party fact-checkers in favor of the crowdsourced community node system employed by Elon Musk's ex. Could that cost it business?
Potentially, some marketers are now saying that the change could limit their ad spend on the platform if it were to lead to the unchecked spread of fake news, harmful content, and hate speech. Several advertising bosses told the Financial Times that brands are beginning to reassess their plans to advertise on Meta's platforms over brand safety concerns.
Chapter 3: What does the December jobs report reveal about the labor market?
For Meta, advertising is not just an important source of revenue, it's the only source of revenue. In the third quarter, advertising accounted for 98% of Meta's total sales of $40 billion. Its 21% share of the U.S. digital ad market is only second to Google,
Meta's ability to keep advertising dollars flowing not only keeps the lights on now, but it's also crucial for subsidizing those futuristic money-sucking bets such as the Metaverse and AI. So the stakes are enormous. Toby, do you think Zuck's gamble on community notes will lead to an advertiser exodus?
I mean, just look at X to see the answer to that question because when X has been kind of the opposite of meta when it comes to brand safety, if you want return on investment, if you want this close relationship with these brands, you don't necessarily look at X as the poster child of that because with X,
uh, Elon Musk kind of more laissez faire this third party, uh, without fact checkers, uh, to keep the platform pretty buttoned up. You have seen advertisers kind of flee the platform and meta has long been seen as not a more of a safe Haven where you will find more brand safe content to place your ads next to. So even though a meta is kind of copying X's fact checking, uh,
approach, you do see how it can unsettle advertisers if you do not have some of these safeguards in place.
So yeah, there is definitely a little bit of fear out there that Meta could start to turn more into a platform that resembles X. Now, the rebuttal to this is that Meta's ad tools are second to none, maybe second to Google. But along with Google, it has built this duopoly in digital advertising. It has incredible targeting tools. Brands often see
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Chapter 4: Who were the weekend's big winners?
Just incredible performance when you place an ad in on Meta's platforms like Instagram or Facebook proper. So the pushback to that is if brands continue to see that performance on their money, that ROI, then they're not going to go anywhere. And that really is all they care about.
Meta did a full-court press to advertisers on LinkedIn and other places saying, look, we still have these brand safety tools in place. Those are not going anywhere. We want to make sure your advertisements aren't appearing next to harmful content. But still... these quotes given to the Financial Times from ad leaders said, yeah, people are going to start reassessing their advertising spend.
So we'll see whether Meta takes a hit. On the other hand, you can say that this story goes in a million different directions, but you could also say that maybe it is a self-defeating move in the advertising space, but it is a plan to future-proof Meta's business in the next administration because there's a huge antitrust trial looming
in April, and a lot of these changes that Mark Zuckerberg has been making to Meta are to get in the good graces of the Trump administration. So a lot of moving parts here.
I don't think you will see advertisers care as long as the platform continues to perform. They don't really care what their ads are. appearing next to you if they are still getting the same ROI that they've been enjoying.
So that's probably maybe the cold hard truth that a lot of these advertising execs did say like, hey, as long as it still makes sense to put our ad dollars there, we will do that regardless of the new fact-checking strategy. But I do think that last part that you mentioned is very important.
Zuck has kind of looked at the playing field here, seen some of the antitrust action that is being levied against big tech and saying, wait a second, whoever's currently in office has a lot of say and usually does end up influencing who or what the antitrust apparatus of the United States ends up operating like.
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Chapter 5: What can we expect in the week ahead?
And so trying to cozy up a little bit to the Trump administration might just be a long-term bet on the future of Meta. He's positioning himself. People are calling Zuckerberg a little bit of a chameleon in this sense that
He is going where the winds are blowing, so part of it is potentially something that he has to consider when it comes to impacting his business's bottom line, but also he is looking ahead and saying, I need to possess myself well for these next four years.
Workers at America's largest bank are donning their Patagonia vests and lacing up their dress shoes once again as they prepare for the end of the work-from-home era. Hybrid employees at JPMorgan got hit with a memo last week saying they will be asked to return to in-person work five days a week starting in March.
Most of the bank's workers were already back clocking in, including senior managers in client-facing roles. This latest move affects mostly back office roles like call center workers who had still been rocking two days a week from home. But so far, the bank's 300,000 plus employees aren't taking it very well.
JP Morgan ended up shutting off comments on the internal memo after employees criticized the move, with some even suggesting unionizing. Neil, on the one hand, about 70% of the bank's employees were already back in the office five days a week. But also, this is certainly the end of an era.
It is the end of an era, as we like to say a lot. Some of these quotes that people were putting on the message board, which I think are quite revealing. One person said that someone who was driven around by a chauffeur must have made the return to office decision. Another said they were bullish on Rolex prices, as you mentioned.
One comment I think that raised a lot of attention was that maybe workers should unionize. Another finally said, this ain't it. So whenever we've seen this over the last few months, Amazon, Starbucks, Dell, AT&T are all large corporations that have said, you know what, this hybrid working experiment that we've implemented since COVID is not working for us for whatever reason.
You can read between the lines. Maybe it's, quote unquote, a soft layoff or something like that. And they're starting to bring workers back to the office. The thing is, as we've seen from these companies bringing workers back to the office, you need to have your office ready. And that hasn't gone totally well.
And I think that's why JP Morgan says we're going to give you a 30 day heads up so we can actually get our stuff in order at our New York offices or wherever they have offices to make sure that we're ready for when you come back in, because that hasn't been always the case.
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