YouTube's Latest Quandary Deepens as AT&T Joins Ad Pause

(Bloomberg) -- AT&T Inc. joined Kellogg Co., Nestle SA, Walt Disney Co. and other major consumer brands in pausing their ad spending on Google’s YouTube video-sharing site over concerns that the platform can be used to forge networks of people engaged in exploitation of children.

AT&T and Kellogg said Thursday they had halted advertising on YouTube. That adds two major U.S. consumer brands to a growing list of companies that have done the same, including supplements retailer GNC Holdings Inc., top Canadian telecom BCE Inc., video-game maker Epic Games Inc., food giant Nestle and German packaged goods company Dr. August Oetker KG. Disney had also stopped advertising, according to people familiar with the situation.

“Until Google can protect our brand from offensive content of any kind, we are removing all advertising from YouTube,” an AT&T spokesman said in a statement.

On Sunday, video blogger Matt Watson posted a 20-minute clip detailing how comments on YouTube were being used to identify certain videos of young girls participating in activities such as posing in front of a mirror and doing gymnastics. Comments under the videos suggested potential predators were bookmarking certain points and sharing them with others. Watson’s video demonstrated how, if users clicked on one of the clips, YouTube’s algorithms recommended similar ones. By Thursday, Watson’s video had been viewed more than 2 million times.

“We are pausing all advertising on YouTube as we learn how YouTube will ensure the safety of all who enjoy its platform,” Kellogg spokeswoman Kris Bahner said in a statement.

YouTube is a growing and important part of Google’s vast internet advertising empire. Video ads are generally more lucrative than Google’s bread-and-butter text search ads. YouTube has seen major boycotts by advertisers in the past, such as when ads appeared next to violent terrorist content, but companies have generally come back to the platform after public concern abated.

“Any content -- including comments -- that endangers minors is abhorrent and we have clear policies prohibiting this on YouTube. We took immediate action by deleting accounts and channels, reporting illegal activity to authorities and disabling violative comments,” a spokeswoman for YouTube said in an email.

Google said it had disabled comments on "tens of millions" of videos that included minors and deleted around 400 accounts that had left concerning comments. Total ad spending on the videos mentioned was less than $8,000 within the last 60 days, and YouTube plans refunds, the spokeswoman said.

That number could be dwarfed, though, by even a week-long boycott by major advertisers, some of whom spend large portions of their advertising budgets on the platform.

--With assistance from Scott Moritz.

To contact the reporters on this story: Gerrit De Vynck in New York at gdevynck@bloomberg.net;Deena Shanker in New York at dshanker@bloomberg.net

To contact the editors responsible for this story: Jillian Ward at jward56@bloomberg.net, Andrew Pollack

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