IAB’s 2025 digital ad predictions—AI and privacy-enhancing tech take center stage

According to the Chinese calendar, 2025 is the Year of the Snake. The snake is often seen as a symbol of transformation and adaptability. I believe the Year of the Snake will also reflect the digital media economy as a year of accelerating change and transformation. One of the things I enjoy about the digital advertising ecosystem is that it has always been a dynamic, fast-moving industry in a constant state of adaptation and innovation. While recent years have been “frothier” than most, starting in 2025, the next several years will be a watershed era for the digital media ecosystem. Ongoing developments in consumer privacy and data security, the explosive growth of CTV, and the evolution of artificial intelligence, to name a few key trends, have the industry standing on the edge of transformative change. Data provenance is about to dominate the conversation, privacy regulations will tighten, and the fragmented world of CTV measurement will remain in chaos. NextGen Marketing Summit Join us for a crash course on Gen Z, DTC marketing and the creator economy Register today But it’s not all uncertainty. AI is finally moving beyond theory, promising real, game-changing applications. Privacy-enhancing technologies are gaining traction, and the drive to innovate is stronger than ever. The stakes are clear: Adapt and lead, or get left behind. The time to act is now—because the next 12 months will determine who thrives in this new era. Here’s what’s coming and why it matters. Data provenance will become a hot-button issue In 2025, companies will embrace the worldwide data minimization movement driven by regulators. The origins of data and how it is collected and managed will be under ever greater scrutiny. As privacy regulations tighten, everyone from publishers to brands will hone their data governance policies to comply with the law. Further, many brands and their agency partners continue to question data quality. They will demand greater transparency: Understanding where data comes from, how it's used, and whether it meets a data transparency standard will be non-negotiable. Measurement chaos will continue, especially in CTV The fight over measurement standards will heat up but don’t expect a breakthrough. While solutions for targeting are available today, post-campaign measurement and analytics are still in flux. Much of the CTV ecosystem remains fragmented, with platforms like Google, Amazon, Roku, and Netflix standing by to capitalize on the confusion. Either the industry collaborates on a framework or risks becoming irrelevant as tech giants dominate. AI will deliver real use cases By the end of 2025, we’ll stop discussing AI as abstract potential and start seeing it in action. Instead of focusing solely on the risks—like LLMs poaching publisher content—the industry will see real, positive use cases emerge. For example, we can expect real AI advancements for content curation, applying statistical methods (like Bayesian inference) to refine these audience groups over time and to produce personalized ad content through adversarial networks. All of this helps make advertising more effective while protecting people's privacy. In the coming age of data minimization, AI could support the digital ad economy in doing more with less. ACR data will trigger privacy concerns Growing concerns are emerging about how automatic content recognition (ACR) data is collected and used in CTV. While ACR offers valuable insights, it also poses privacy risks, especially given the detailed viewing information it relays. Additionally, ACR data is not normalized, lacks a common taxonomy, and is therefore often challenging to use effectively, raising questions about its reliability and potential impact on consumers. In 2025, this ticking privacy time bomb could go off. Signal loss will continue to spur innovation While 2025 may not be the final year of the third-party cookie, it certainly won’t do it any favors. In addition, we’ll see the acceleration of the loss of IP addresses due to the increased adoption of Apple’s Private Relay and the increased usage of IPv6 (we’re running out of IPv4 addresses!). Read Ad Age’s Best of 2024 stories here This will lead to increased development and usage of alternative addressability solutions and currencies across the browser landscape. At the same time, publishers continue to innovate their first-party data and ad solutions, such as Hearst’s Aura or DPG Media Group’s Ad Manager. PETs take flight (no—not your bird) We will see accelerated progress in making digital advertising work alongside privacy protections. Privacy-enhancing technologies (PETs) continue to gain traction, making cryptographic data security solutions increasingly practical. While they won’t yet be scaled, PETs will begin establishing a presence. Regulators are paying attention as we hear the call for greater deployment of PETs, particularly within the data clean room sector. By the end of 2025, leveraging PETs will become an industry best practice. The year we stop pretending The year 2025 is a gut check for the digital advertising industry. It’s time to get honest about what’s working, what’s not, and what it’ll take to stay relevant in a landscape defined by privacy, precision, and performance. The truth? There’s no magic bullet. Success will demand transparency, collaboration, and a willingness to rethink the rules. The Year of the Snake also signifies wisdom and invites everyone to embrace change. Which companies across the digital media ecosystem will be wise enough to embrace these accelerating global changes and adapt? For those ready to transform, 2025 could be a breakout year. For everyone else? The clock is ticking. 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IAB Tech Lab's 2025 digital ad predictions—AI and privacy-enhancing tech take center stage

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