Google’s latest General Data Protection Regulation update has unsettled publishers and independent ad tech vendors.

Last week, the tech platform confirmed it’s limiting how many ad tech vendors publishers can get user consent for, should they choose to use Google’s consent manager provider, or CMP, under the GDPR, as first reported by AdExchanger. Publishers that use Google’s consent-gathering tool, Funding Choices, can only use 12 ad tech vendors, according to an update on Google’s support blog. This is one of several tools Google is providing publishers with to gather consent across their websites and apps.

While ad tech vendors publicly display confidence, many are privately panicking. “No one is safe,” said an ad tech executive, who spoke on condition of anonymity. “They’re scrambling to get in front of publishers. There is no way the average publisher’s ad tech and sales teams can fully understand the nuts and bolts of how some of these second-tier ad technologies work. So, it’s going to come down to their relationships with publishers.”

Several publishers Digiday spoke to received a flurry of emails from ad tech partners on May 4, asking if publishers plan to use Funding Choices, and if so, whether they are among the chosen 12 vendors. “People are getting nervous they won’t have access to good supply,” said a publishing executive.

No one knows why Google picked 12 as the number of vendors. To some publishers, it seems like an arbitrary figure that’s way lower than what most publishers require to maintain their programmatic revenue. A quick count of the main data management platforms, supply-side platforms, demand-side platforms, ad servers and viewability companies in the market (excluding Google) comes to 20 vendors. Both ad tech and publisher execs predict vendor consolidation as a result of the restrictions. “I can’t see it as anything other than a vendor bloodbath,” said a publishing executive who spoke on condition of anonymity.

Google didn’t respond to a request for comment before press time.

As it stands, publishers have three choices: Use Google’s Funding Choices and agree to select only 12 vendors (they’d technically choose 11 vendors, as Google will count as one) that send revenue back to publishers; they can choose an alternative CMP provided by a third party; or build their own CMP as Axel Springer has.

For many of the big publishers, picking an alternative CMP to Google is a no-brainer. “We want control on who and how many partners we work with,” said another publishing executive. “Publishers who have the bandwidth to implement their own CMP will probably avoid the Google Funding Choices.” The fact that alternative CMP solutions exist and larger publishers likely want to develop their own CMP options has given some ad tech vendors hope.

A lot of publishers have already reduced the number of vendors they work with over the last year, to reduce page latency, eliminate hidden fees or reduce the number of middlemen in the supply chain. The implementation of ads.txt, the Interactive Advertising Bureau’s anti-fraud initiative, has led publishers to shed even more vendors.

But publishers want control over who they cut and when. “If I want to add in another partner, that should be my business choice, not made because I’ve been given stiff restrictions,” said a different publishing executive. “Essentially, I’m being asked to control who buyers work with and who we work with. For me, it’s pretty unrealistic.”

Having only 12 ad tech vendors could also dent publishers’ programmatic revenues in the short term. “The commercial depression we could see from this restriction is too big a risk to take at this early stage, when it’s coupled with the potential revenue losses that could arise due to the GDPR,” said the same executive.

However, not all publishers have a choice. It’s far easier for publishers to adopt Google’s free CMP than develop their own or pay for an alternative. Small and medium-sized publishers rely on Google’s suite of services to maximize revenues due to the tech giant’s dominant position in the digital supply chain. That makes it more likely that the majority of mid- to long-tail sites will adopt Funding Choices. “Publishers that do not have the resources or budget may just go for the easiest and cheapest solution,” said another publishing executive.

The last-minute scramble from businesses to prepare for the GDPR before enforcement starts May 25 has caused chaos in the industry. The timing of Google’s updates, just three weeks before the deadline, and the fact that Google’s interpretation of the law seems to starkly contrast with that of other media and advertising businesses has added to the confusion. “Google is clearly putting us in a hard place as they have informed all publishers very late, giving very little time to adapt or make an informed decision,” said a publishing executive.

Publishers are divided on Google’s motives. On one hand, Google is already under immense pressure from Brussels regarding anti-competitive behavior. The platform will do all it can to ensure its own GDPR compliance. That said, it is convenient that its move to limit publishers to 12 vendors could ultimately enable it to direct demand back to its own stack, creating an unfair advantage.

“You can argue this is Google muscling to dominance, or you can see it as common sense. It’s probably both,” said a publishing exec. “Google sees GDPR as a strategic win.”

Download Digiday’s guide to GDPR for checklists, research and more that you’ll need to know before May 25.

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