TheChek News Flow

A flurry of new offerings for advertisers is hitting the market

Google’s grip on the nearly $300 billion search advertising business is loosening.

For years, the tech giant has seemed invincible in this corner of the ad market, which is the foundation of its business. Now, rivals are beginning to eat into its lead, and new offerings—fueled by the rise of artificial intelligence and social video—threaten to reshape the landscape.

TikTok, the wildly popular short-form video platform, has recently started allowing brands to target ads based on users’ search queries—a direct challenge to Google’s core business.

Perplexity, an AI search startup backed by Jeff Bezos, plans to introduce ads later this month under its AI-generated answers. Until now, it has made revenue mostly from a $20-a-month subscription offering that grants access to more-powerful AI technology.

The new initiatives add to the pressure on Google from the rise of Amazon.com, which has taken a chunk of search ad spending. Many consumers begin product searches on the e-commerce platform.

Google’s share of the U.S. search ad market is expected to drop below 50% next year for the first time in over a decade, according to the research firm eMarketer.

Amazon is expected to have 22.3% of the market this year, with 17.6% growth, compared with Google’s 50.5% share and its 7.6% growth.

“This space has been ripe for a shake-up for a long period of time,” said Brendan Alberts, head of search and commerce at the ad-buying firm Dentsu.

Google remains in an enviable position: far ahead of the pack in the search market, with plenty of resources to counter moves by its rivals. Still, advertisers are eager for more competition.

“For the first time in probably 15 years, we will have viable alternatives to Google,” said Nii Ahene, a veteran digital-advertising executive.

Answers and ads

The generative-AI boom is transforming search products, which will increasingly serve up fully formed answers to user queries or summaries of the results. Google this past week rolled out ads in the AI-generated summaries it has begun placing at the top of search results. The ads will only show up on mobile searches in the U.S. at first, Google said.

In one example of how the new search ads might appear, Google showed a listing for a Tide pen that is available on the Albertsons website in an AI overview responding to the query, “How do I get a grass stain out of jeans?”

“We’re confident in this approach to monetizing our AI-powered experiences,” said Brendon Kraham, a Google vice president overseeing the search ads business. “We’ve been here before navigating these kinds of changes.”

Perplexity is angling for a piece of the same market. Dmitry Shevelenko, the company’s chief business officer, said a handful of “household, top-tier names” are its first advertisers. The startup will allow brands to sponsor follow-up questions that trigger a back-and-forth with the user.

In a presentation to advertisers, Perplexity said answers to the sponsored questions will be “approved ahead of time, and can be locked, giving you comfort in how your brand will be portrayed in an answer,” according to a copy viewed by The Wall Street Journal.

“What we’re opening up is the ability for a brand to spark or inspire somebody to ask a question about them,” Shevelenko said.

Some 46% of Perplexity queries in the U.S. lead to follow-up questions, according to the presentation. The company said it processed 340 million queries in September. By comparison, Google has said that it handles some two trillion searches a year. Shevelenko said Perplexity won’t ever change the search engine’s nonsponsored answers based on demands from advertisers.

Other search engines have experimented with inserting ads in AI-generated answers. Microsoft has introduced sponsored links and comparison-shopping ads in a chatbot attached to its Bing search engine.

Almost 60% of U.S. consumers used a chatbot to help research or decide on a purchase in the past 30 days, according to a survey by New Street Research. Some analysts have questioned whether ads in chatbots will be as valuable as traditional search ads, because people might be less likely to click on them.

TikTok keywords

Targeting search budgets is a logical step for TikTok. Up to now, the company has offered brands the option of displaying ads near search results, but advertisers couldn’t target their ads based on the keywords in user searches.

Advertisers remain drawn to TikTok because of the platform’s strong appeal to younger adults—interest that hasn’t diminished despite the U.S. government’s efforts to force the app to sever ties with its Chinese owner or face a potential ban. While TikTok’s U.S. ad revenue is expected to jump 38.1% this year, it only has a 3.4% share of the U.S. digital ad market, according to eMarketer.

In a pitch to advertisers viewed by the Journal, TikTok said “search behaviors have evolved” and added that the platform had global daily search volume of over three billion, with 23% of users searching for something within 30 seconds of opening the app.

Many advertisers tested TikTok’s new ad product earlier this year. Some brands were required to commit a minimum of $10,000 a month and participate for at least two months, according to ad buyers.

The digital ad firm Tinuiti said almost two dozen of its clients in such categories as consumer electronics, apparel and beauty are currently buying the new TikTok ads, and the majority are seeing positive results.

“We are seeing performance on return on ad spending that sometimes rivals what we are seeing on Google,” said Tinuiti President Jeremy Cornfeldt. The real test is what happens when more advertisers compete for keywords and ad prices go up, he said.

Some advertisers are hesitant to shift ad dollars from Google to TikTok, said Sara Young, a group account director of social activation at the digital agency Dept, partly because search volume on TikTok is still low.

The increased competition, coupled with legal pressures on Google, makes it a particularly tense time for the Alphabet GOOGL 0.72%increase; green up pointing triangle-owned ad giant. This past summer, Google lost an antitrust case over its dominance in the U.S. search-engine marketplace after a federal judge said it acted illegally to maintain a monopoly in the sector. Google plans to appeal the ruling.

“Is it a vulnerable moment for Google? Absolutely,” Cornfeldt said.

Europe’s tariffs are the latest move by nations pushing back against imports from world’s biggest producer

The push by Chinese electric-vehicle makers to export their made-in-China vehicles is running into roadblocks just a few years after it got going, owing to moves by countries around the globe to impose tariffs and other restrictions.

On Friday, European Union member states voted to impose tariffs of up to 45% on electric cars made in China.

Here is how the world’s biggest EV-producing nation has hit trouble overseas—and what its carmakers are doing to get around it.

Ramping up exports

China’s surging EV production helped its carmakers reduce costs and become more competitive. With capacity outpacing demand at home, they began looking overseas in recent years.

The response: tariffs

Countries seeing a surge in imports of made-in-China EVs have often responded with more tariffs. Brazil raised its tariffs on battery EVs to 18% in July from 10%. The tariff will rise again to 35% in July 2026.

Turkey has imposed an additional 40% duty on electric cars from China since July, while in Canada, a 100% tariff on Chinese-made EVs took effect Oct. 1.

The U.S. imports relatively few Chinese-made EVs and has already acted to make sure that remains the case. The Biden administration this year imposed a 100% tariff on Chinese EVs.

Export growth slows

Brazil is an example of a country where higher tariffs have caused a sharp drop in its imports of made-in-China EVs. Imports in the EU have also stopped rising while in some other markets such as Mexico and Canada imports from China have still been growing.

Building EV factories outside of China

In the past year, many Chinese companies have stepped up moves to build or invest in car production overseas to avoid tariffs. One example: BYD, the biggest Chinese EV maker, will build a factory in Turkey with an annual capacity of 150,000 vehicles, to open in 2026, the government said in July.

Oil companies try to persuade Trump and his Republican allies not to slash provisions of the Inflation Reduction Act potentially worth billions

Oil companies are conveying an unlikely message to the GOP and its presidential candidate: Spare President Biden’s signature climate law. At least the parts that benefit the oil industry.

In discussions with former President Trump’s campaign and his allies in Congress, oil giants including Exxon Mobil XOM 1.84%increase; green up pointing triangle, Phillips 66 PSX -0.22%decrease; red down pointing triangle and Occidental Petroleum OXY 1.77%increase; green up pointing triangle have extolled the benefits of the Inflation Reduction Act. Many in the fossil-fuel industry opposed the law when it passed in 2022 but have come to love provisions that earmark billions of dollars for low-carbon energy projects they are betting on.

Some executives in the largely pro-Trump oil industry are worried the former president, if re-elected, would side with conservative lawmakers who want to gut the IRA. They fear losing tax credits vital for their investments in renewable fuel, carbon capture and hydrogen, costly technologies requiring U.S. support to survive their early years.

At a Houston fundraiser for Trump in May, Occidental CEO Vicki Hollub took her case directly to the candidate, saying tax credits propping up the company’s huge investments in technology to collect carbon directly from the air should be preserved, people familiar with the matter said. The company is building its first $1.3 billion direct-air capture plant in West Texas and aims to erect dozens more in the coming years.

Exxon has also told the Trump campaign it wants to preserve portions of the IRA. It and Chevron, the two largest U.S. oil companies, have promised to pump more than $30 billion combined into carbon capture, hydrogen, biofuels and other low-carbon technologies, virtually all of which rely on tax credits in the IRA to be viable.

Meanwhile, company officials at Phillips 66, a $58 billion U.S. oil refiner, have told members of Congress the IRA’s tax credits are important for its business, people familiar with the matter said. Instead of crude oil, the company’s renewable fuels are made from used cooking oil, vegetable oil, fats and the like, which qualify it for large tax credits.

“There are elements of the IRA that the general industry says would be bad to unwind,” Mark Lashier, CEO of Phillips 66, said in an interview last month. “Everybody is working out their contingency plans for either administration.”

Green politics

Trump has called Biden’s climate efforts the “Green New Scam” and last month promised to cut unspent IRA funds. With the backing of influential conservative think tanks, Republicans in Congress have tried to repeal the law and provisions in it dozens of times and are expected to push for cuts again next year during the legislature’s budget reconciliation.

Oil billionaires are some of Trump’s biggest backers, and the candidate has privately promised to deliver on many of the policies on their wish lists if elected.

Trump hasn’t fleshed out his plans for the climate law.

Some oil lobbyists have told his campaign the industry’s IRA-backed projects will be a boon to U.S. jobs and manufacturing as major oil companies invest billions.

Karoline Leavitt, a spokeswoman for the Trump campaign, said Trump’s policies turned the U.S. into a net exporter of energy.

“He cut red tape and gave the industry more freedom to do what they do best—utilize the liquid gold under our feet to produce clean energy for America and the world,” she said.

Political strategists said Trump may try to rebrand the law, given the support for it among officials and companies in some Republican-leaning states, such as Oklahoma and South Carolina, who see it as a draw for new investments and jobs.

“If we win, we need to take a scalpel, not an ax, to the IRA,” said Sen. Kevin Cramer (R., N.D.). North Dakota is well-known for its booming oil fields in the Bakken Shale. Oil companies there aim to inject industrial carbon dioxide into the ground to recover more crude, which would also make them eligible for carbon-capture subsidies.

The industry’s support for the IRA only extends so far. Many oppose tax credits for renewable energy and purchasing electric vehicles, saying those incentives undermine competition with gas- and diesel-powered vehicles. Smaller frackers, which aren’t investing in low-carbon technologies, mostly dislike the entirety of the law.

In recent months, Biden’s administration has signaled it is rushing to fund clean-energy projects from a $400 billion lending program created by the IRA. A second Trump administration might slow-walk spending by federal agencies meant to support those projects, said Gordon Huddleston, president of investment firm and natural-gas producer Aethon Energy Management.

“The DOE would just slow down giving out money in a Trump administration,” he said.

A small, vocal faction of GOP budget hard-liners could make it difficult for Trump to preserve even parts of the IRA. The law would make for a tempting target to offset fiscal deficits as the party pushes to renew its 2017 tax cuts next year.

Big bets

The oil industry has fought Biden’s administration for years on restricting fracking, rules for drilling in the Gulf of Mexico and other environmental regulations. But companies that are investing in low-carbon projects stand to lose much if Biden’s climate law is repealed or watered down.

Occidental, one of America’s largest oil producers, is betting big on a largely unproven technology—at a large scale—to suck carbon dioxide from the atmosphere and store it underground.

The process is costly and Occidental has said benefits from federal subsidies of $180 per metric ton of CO2 captured that way and stored permanently will boost the endeavor. Its CEO has for years personally lobbied in Washington to increase the value of the credits.

Bolstered by the IRA, Phillips 66 has transformed a 128-year-old Rodeo, Calif., oil refinery into one that can pump 50,000 barrel-per-day of renewable diesel and aviation fuel.

But the economics of producing renewable fuels are challenging and some of the refiner’s competitors, including Chevron, BP and Shell, have scaled back on similar plans this year. Losing IRA credits would make the business even more difficult.

Oil-and-gas companies are stressing that the IRA is valuable to the country’s economy now in hopes of avoiding tougher conversations after the election, lobbyists said.

“It’s really striking the degree of commitment the industry has made to low-carbon businesses like carbon capture, biofuels and hydrogen,” said Daniel Yergin, the vice chairman of S&P Global and a veteran chronicler of energy trends.

Big Four accounting firm to reorganise areas of the business affecting 2,700 staff and partners

PwC’s new UK chief has launched an overhaul of its operations in the country, which will involve creating a standalone technology and artificial intelligence unit, in a move that bosses acknowledged could be “unsettling” for staff.

The Big Four accounting firm told employees last week that it would embark on a reorganisation of areas of the business affecting about 2,700 staff and partners, adding that it was part of its “new vision to become the pre-eminent firm”, according to a document seen by the Financial Times.

Under the plan, PwC will create a “digital delivery unit” focused on tech innovation, AI engineering, cloud and data. The firm will also overhaul parts of its consulting, deals, risk and tax practices by moving and merging certain functions, creating six new teams.

It is the biggest internal overhaul of PwC’s UK business in years. It also marks the latest reorganisation of a Big Four accounting firm as the sector seeks to adapt to changing client demand and grapple with how best to structure their fledgling AI advisory businesses, which partners see as a lucrative growth area.

The realignment will create upheaval for about a tenth of PwC’s UK workforce who will be transferred into new teams and service lines. Reorganisations within professional services firms can often lead to jostling for position within the business.

Laura Hinton, PwC’s UK managing partner who was a runner-up to Marco Amitrano in the race to lead the firm earlier this year, was dispatched to break the news to staff last week in a pre-recorded video message.

In the message, a transcript of which has been seen by the FT, Hinton said that the reorganisation was designed to “simplify” the business and “reduce duplication”. She added that it would “create scale and increase our market impact”.

“I know that, for some, change can feel energising, while for others it can feel unsettling,” Hinton said. “As we continue to adapt to our clients’ needs, it’s important that we all get used to being more agile, while continuing to support each other.”

Details of Amitrano’s broader strategy for the firm will be shared with its 1,000-plus partners at briefings on Wednesday, according to several people familiar with the matter.

It comes after a bruising period for the industry, with PwC last month reporting a drop in average partner pay as revenue growth slowed and higher costs and provisions for legal claims hit profits.

Rival Deloitte, which embarked on an overhaul of its global operations earlier this year to cut costs and reduce the group’s complexity, also posted a drop in average partner pay and weaker growth.

PwC’s reorganisation is not designed to cut costs and will not lead to new redundancies, according to a person briefed on the plan. The firm last year axed hundreds of jobs amid a market downturn and also launched a round of “silent lay-offs” in the UK earlier this year.

Hinton said the new digital delivery unit would house 900 “technologists” and work across the firm’s different service lines. It will also be given a “market-facing name”.

“These plans are a work in progress so, although we don’t have all of the detail or answers, we still wanted to share this now to be open and transparent,” she said.

Separately, the firm’s consulting leaders shut down speculation that PwC had plans to sell Strategy&, the firm’s strategy consulting arm, to Bain & Co, or any other buyer, telling staff that the industry rumours were not correct, according to an email seen by the FT.

In a statement to the FT, Amitrano said the changes “reflect our strategic focus on clients, technology and PwC’s global network. They will make it easier for us to collaborate and mobilise teams to better deliver for clients”. The changes will come into effect from January next year.

Long-stalled project among a flurry of glitzy real estate deals designed to attract investors and tourists

One of Saudi Arabia’s richest tycoons has launched a comeback attempt, reviving a project to build the world’s tallest tower as developers in the kingdom embark on a flurry of glitzy real estate projects.

Work restarted this week on the Jeddah Tower, which at more than 1,000 metres is set to surpass the 828-metre Burj Khalifa in neighbouring Dubai as the world’s tallest building when completed in 2028.

It is the most high-profile deal involving billionaire Prince Alwaleed bin Talal and his Kingdom Holding Co since he was detained in Riyadh’s Ritz-Carlton in an anti-corruption drive in 2017. The project started in 2013 but stalled following the crackdown.

“We’re back,” Prince Alwaleed posted on X this week alongside a video rendering of the project, touring the site in his trademark aviator-style sunglasses.

It is among a series of high-end real estate announcements this week, which come as Saudi Arabia competes with rival financial hubs such as Dubai for global businesses and tourists despite an economic slowdown.

Hyatt said it would partner on two luxury hotels at Neom, the futuristic city on the country’s north-west coast that is a centrepiece of Crown Prince Mohammed bin Salman’s Vision 2030 project. Marriott International also revealed plans to open a Ritz-Carlton resort on the Red Sea island of Amaala next year.

While the government plans to cut spending next year amid concerns about a widening budget deficit due to declining oil revenues, the announcements indicate there is still appetite for high-profile projects in a bid to attract foreign investors and visitors and help diversify away from hydrocarbons.

“The Saudis understand that they need to be smart about development and also maintain economic momentum,” said Robert Mogielnicki, senior resident scholar at the Arab Gulf States Institute in Washington. “Creating a buzz around projects helps feed a sense of excitement around the economic transformation agenda.”

The Jeddah Tower — whose shape is meant to evoke “a bundle of leaves shooting up from the ground” — was one of the most ambitious projects by Prince Alwaleed, who made his fortune in real estate and banking before building a global portfolio that included stakes in Disney and Apple.

But it stalled after both he and senior executives from Saudi Binladin Group, a partner in the tower project and its main contractor, were caught up in an extraordinary anti-corruption campaign launched by the crown prince as he rose to power in 2017.

Several hundred princes, businessmen and senior officials were arrested and held in the Riyadh Ritz-Carlton hotel. The charges against them were not made public, and most of them were released after reaching undisclosed settlements with the government, which said it secured $100bn.

Prince Alwaleed, who was detained for more than two months, was released after reaching what he called a “confidential and secret agreement” with the government. He has done multiple other deals since, investing in Citibank last year.

He agreed in 2022 to sell 16.87 per cent of KHC to the state sovereign wealth fund, the Public Investment Fund, and SBG was restructured after the government appropriated a large stake in the firm as part of the settlement for the corruption allegations.

An associate firm of Kingdom Holding signed a SR7.2bn ($1.9bn) agreement with SBG to resume construction this week.

Dubai, one of seven sheikhdoms that comprise the United Arab Emirates, has been the region’s financial hub for the past three decades.

But Saudi Arabia has been aggressively pressing multinational companies to relocate their regional headquarters to the kingdom, warning businesses that they would miss out on lucrative government contracts if they don’t base their operations in the country.

The government said this week that 517 companies, 30 per cent of them Fortune 500 companies, had been licensed to establish their regional headquarters in Riyadh.

“There is a clear competition as there are only so many business hubs a region can support,” said Steffen Hertog, an expert on the Gulf’s political economy at the London School of Economics.

Hertog said issues such as “operating costs, the local skills basis, labour nationalisation rules, the local regulatory environment and the Saudi lifestyle offering . . . will decide how much [Saudi Arabia] can become a regional and global business hub”.

Comments in closed-door conference shows oil groups seek to capitalise on demand for metals needed for energy transition

French energy giant TotalEnergies is studying whether to start trading copper, potentially paving the way to expand its vast oil trading operations into metals for the first time to capitalise on the energy transition.

Rahim Azouni, senior vice-president of crude, fuel and derivatives trading, said the company has been “studying the case” for trading copper, in remarks made at a closed-door conference in London, according to several people who attended.

Azouni cited the energy transition as the reason to consider expanding into copper trading, but added that it had not yet decided to do so, people who heard his remarks on Wednesday told the Financial Times.

TotalEnergies already has a vast trading arm that handles oil products, gas, power and new fuels, though it does not disclose the size of its trading activities. 

His remarks come as a growing number of oil traders are expanding into metals to capitalise on the world’s need for copper, which is used in electricity cables, buildings and electric vehicles. The race for cleaner energy is also boosting demand for aluminium and nickel.

While global copper demand is expected to surge over the next decade, the oil market has been lacklustre this year with China’s reduced demand for the fossil fuel keeping prices low despite war in the Middle East.

Traders and trading firms that have built their fortunes around trading oil, recording bumper profits during the energy price volatility since Russia’s invasion of Ukraine in 2022, are increasingly moving into metals to capitalise on demand. 

Vitol, the world’s largest independent oil trader, has recently returned to metals trading, a business that it exited in 2014.

This year it poached two aluminium traders from a rival firm, and is focused on aluminium as part of its energy transition strategy.

Geneva-based commodity firm Mercuria is also expanding into metals, building a 60-person metals trading unit under Kostas Bintas, formerly the co-head of metals at rival Trafigura.

Even hedge fund manager Pierre Andurand, one of the world’s top-performing energy traders, has shifted to focusing on copper and other metals. Earlier this year he predicted that copper would reach $40,000 a tonne over the coming years, quadruple its current price. 

Tom Price, resources analyst at Panmure Liberum, said that low volatility in the oil market, and long-term changes in energy systems, were driving the shift to metals.

“They can see oil demand and the oil market in trend decline, and they are trying to de-risk that world, by switching to [the] metals world,” said Price, adding that the transition might be difficult for companies built around oil trading.

“These markets aren’t structured the same way as oil,” he said. “In principle they can do it, but in practice it will be a struggle.”

TotalEnergies Chief Executive Patrick Pouyanné has previously said that the energy transition is likely to increase energy prices in the long term, although the group is now also bracing for a period of lower prices in liquefied natural gas as more supply comes online, especially from 2027 onwards.

That has added to Total’s incentive to buttress its earnings, with the company telling investors on Wednesday that it was confident it could “de-risk” its LNG activities and operate profitably.

TotalEnergies declined to comment on the copper trading plans.