AAPL Apple Inc

By Benjamin Mullin 

Taboola, the "content recommendation" firm known for placing sponsored links on thousands of publishers' sites across the web, is opening a new front in its battle for users' attention: the lock screen on their phones.

Taboola has inked a deal with Chinese smartphone manufacturer ZTE Corp. to incorporate a new feature that displays Taboola's recommended links on some of its phones, the companies announced Wednesday.

The module will initially include only links to news and lifestyle stories from some existing publishing partners, although the company may eventually expand to include paid links from content marketers, according to Taboola Chief Executive Adam Singolda.

Taboola's publishing partners include USA Today, HuffPost, Business Insider and MSN, but the company declined to disclose which publishers would be featured in the new mobile effort with ZTE.

Publishers pay Taboola to include their links in its recommendations and refer readers to their websites, typically by giving Taboola a cut of the advertising revenue generated on the site. In return for pre-installing the Taboola module on its phones, ZTE will get a piece of that ad revenue share, said Mr. Singolda. He declined to give specifics on the revenue split.

Taboola will select news for the feature in two ways, Mr. Singolda said. Publishers that already have agreements with Taboola to include the company's recommended links on their sites won't have to pay an upfront cost to be included. Instead, they'll give Taboola and ZTE a proportion of the revenue they make when a user clicks on one of Taboola's recommended links on their websites. Publishers that don't already have deals with Taboola can pay into an automatic bidding system to have their links included.

Mr. Singolda is pitching the module as a publisher-friendly Android version of Apple News, the iPhone app developed by Apple Inc. that comes pre-installed on the company's mobile devices.

Unlike Apple News, Taboola's module won't be contained in a stand-alone app, Mr. Singolda said. Rather, it will show news articles to smartphone users on their "lock" screens when they begin using their phones after a period of inactivity. Coming soon is a companion module that will show users recommended articles when they swipe right on their phones.

Another distinction from Apple News, according to Mr. Singolda, is that the ZTE feature will send readers directly to publishers' websites, allowing publishers to exercise more control over ad sales and the relationship with readers. Rather than serving as an intermediary between publishers and their audiences, he said, Taboola's new effort is aimed at strengthening the relationship between the two.

"I'm concerned the most about the dilution of the relationship between quality publishers and their loyal audiences over time," Mr. Singolda said.

Publishers have long complained that Apple News, which launched in 2015, doesn't allow them to fully monetize their audience on the app. However, in recent years, Apple has allowed publishers to start selling subscriptions through the app and made it easier for individual publishers to sell ads against their content in the app.

Eventually, Mr. Singolda said he wants Taboola to cut deals to include its content recommendation module on every Android phone.

"Taboola wants to be everywhere you make decisions," Mr. Singolda said. "We always want to drive traffic directly to the content owner, and we never want to become a walled garden ourselves."

(END) Dow Jones Newswires

April 04, 2018 12:18 ET (16:18 GMT)

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