Digital ad spending in 2022; next e-commerce deals; cryptocurrency rules

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Top News

Global advertising spending is expected to grow by about 10% in 2022, slower than the record gains seen in 2021 as the industry recovered from pandemic-induced declines but still strong by historical standards. In the U.S., ad growth rates could outpace global gains, driven by strong digital spending, economic improvement and consumer purchases. About two-thirds of U.S. advertising is now digital "in some form or another, and the returns available to advertisers have likewise increased," Morgan Stanley analyst Benjamin Swinburne said. Competition in the streaming media space is expected to continue to drive growth in digital and linear ad spending in 2022.

An Amazon worker in a mask. Source: Amazon.com Inc.

On the consumer side, Amazon.com Inc. and other U.S. e-commerce retailers are likely to pursue deals in 2022 that will further bolster their digital and technology capabilities, a move experts say will help them tighten their grasp on higher levels of online sales in the new year. The investments they make in 2022 will help them further capitalize on online sales as well as drive demand and efficiencies in areas such as content, delivery and supply chain, said Tim Campbell, director of industry insights at e-commerce management platform CommerceIQ.

In financial technology, lawmakers and regulators are expected to intensify efforts to put cryptocurrency under the microscope in 2022, with questions swirling about oversight and enforcement. Those actions are ever more significant as the cryptocurrency market has exploded, with some companies doing business entirely in the digital sphere, while banks are venturing further into that world.

Chart of the Week

Capital raises from infotech sector continue to decline

Publicly traded information technology companies in the U.S., Canada and Bermuda raised about $13.26 billion through capital offerings in November, down from $15.25 billion in October and $19.09 billion in September.

Tech, Media and Telecom

Ad rates set for strong growth in 2022 as digital habits stick

Excluding an expected uptick in U.S. political ad spending, media buying agencies GroupM, MAGNA and Zenith Media Services Inc. forecast 2022 growth of 9.7%, 12% and 9.1%, respectively. That follows estimated 2021 global ad growth ranging from Zenith's 15.6% on the low end to about 22% from the other two media agencies.

Cable comes through a tough 2021

A steep increase in mobile subscribers, competition in fiber expansion and shifting consumer habits due to the COVID-19 pandemic contributed to an unstable year for cable stocks in 2021 and set the scene for an uncertain 2022.

Consumer

E-commerce firms eyeing deals to bolster digital reach, supply chain in 2022

Amazon, Walmart and Target are poised to spend billions of dollars on efforts to add to their online offerings and technical capabilities.

Fintech

Congress, regulators to focus sharply on cryptocurrency in 2022

The issue is likely to ramp up in Congress in coming months, although partisan differences may create roadblocks for over two dozen pieces of legislation, experts said. Many Democrats are saying cryptocurrency should be regulated like banks, while some Republicans contend that would clamp down on innovation.

Insurance-focused blank-check companies raise $3.6B from IPOs in 2021

Special purpose acquisition companies with insurance as one of their intended target sectors raised about $3.60 billion from 20 IPOs in 2021, despite the U.S. Securities and Exchange Commission's April crackdown that led to a sharp decline in SPAC filings in the second quarter.

Energy

Renewables, batteries to dominate US electric additions in 2022, '23 – EIA

Wind, solar and battery storage resources are poised to account for three-quarters of utility-scale capacity additions in the U.S. over the next two years, according to the U.S. Energy Information Administration.

Renewables output climbed 8.7% YOY in October

Net utility-scale generation continued to increase slightly year over year in 2021, with the share of natural gas decreasing 0.9% from July's net total and coal ticking down 5.6% over the same time period, following notable increases throughout the year.

Top Research

Texas solar pipeline booming despite tame financial outlook

At the end of 2019, there were just over 2,800 MW of operating solar in Texas. In the last two years, that figure has nearly tripled as nearly 5,000 MW of solar have been installed in the state since 2020. This recent ramp-up in solar interest is just the beginning. Over 43,000 MW of solar capacity are in development in Texas, nearly four times more capacity than the next-highest state of California. Multiple drivers are behind this aggressive pipeline, but analysis of the financial outlook for new solar projects in Texas, while adequate, is not proportionately favorable.

From Kagan, a media research group within S&P Global Market Intelligence:

Euro sports H2'21 — DAZN's crucial 2022, Viaplay expansion and EPL's US bonus

Sports streamer DAZN has secured live broadcast rights to La Liga matches in Spain, making its Spanish proposition one of its strongest in Europe. The deal is for 175 games per season from 2022 to 2028, and Telefónica-owned Movistar won the other 205 games.

From 451 Research, a part of S&P Global Market Intelligence:

Voice of the Enterprise: Information Security, Budgets & Outlook – advisory report

The Voice of the Enterprise: Information Security, Budgets & Outlook survey wave was completed during the fourth quarter of 2020 and the first quarter of 2021. The survey represents more than 500 completes from pre-qualified IT decision-makers. Delivered quarterly, this research provides comprehensive, survey-driven analyst reports with customizable data deliverables.

451 Research Datacenter Knowledgebase

Using the 451 Research Datacenter KnowledgeBase dataset, now available via Xpressfeed™ and Snowflake, you can assess market and region energy current and future demand from data centers.

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Click here to listen to the latest episode of "MediaTalk," an S&P Global Market Intelligence podcast. In this episode, Alexandra Reeve Givens, head of the Center for Democracy and Technology, and Sheryl Kingstone, head of customer experience and commerce at 451 Research, provide insights on privacy legislation in the U.S., how online companies are storing our data and growing concerns among consumers about privacy in the wake of the pandemic.

Click here to listen to the latest episode of "Next in Tech," a weekly podcast featuring 451 Research and other areas of S&P Global Market Intelligence. The recently released Big Picture reports cover topics such as metals and mining, insurance, energy, and finance. Despite that variety, common themes link them. Research directors and report authors Ian Olgeirson and Scott Crawford join host Eric Hanselman to discuss different aspects of M&A activity in media and security. The former is playing for reach; the latter is reaching for functionality. The reports are available for review.