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• Transcript

  James Kotecki (00:06): 

  This is CES Tech Talk. I'm James Kotecki with another conversation that I recorded live at CES 2025 in the C Space Studio. You can get all those interviews on the CES YouTube channel, but we're bringing this one right to your podcast feed. Enjoy. 

  (00:24): 

  Hey, welcome back. You're in the C Space Studio with me, James Kotecki. We are here at CES 2025 and we are here with Brian O'Kelley, CEO and Co-Founder of Scope3. Thank you so much for joining us. 

  Brian O'Kelley (00:36): 

  Thanks for having me. 

  James Kotecki (00:37): 

  All right, so tell us about Scope3. What is Scope3? 

  Brian O'Kelley (00:40): 

  Scope3 is a sustainability platform built to measure and reduce the carbon impact of digital technology, and especially digital advertising. 

  James Kotecki (00:48): 

  Okay. Tell us about the platform. If I log in, what am I looking at? Give us the visual. 

  Brian O'Kelley (00:54): 

  First thing we do is we get you to pull in all of the money you've spent on different advertising channels. So different platforms, programmatic, non-programmatic. We need to get a picture of where you're spending money. And every dollar you spend in advertising is actually going and getting an ad to be chosen by some technology, maybe programmatic, maybe more traditional, and then delivered to a user device. And every step of that process takes electricity. 

  James Kotecki (01:20): 

  Yeah. 

  Brian O'Kelley (01:21): 

  In cases, huge amounts. And with AI we're seeing even more electricity-- 

  James Kotecki (01:25): 

  Yes. I want to get into that. Yeah. 

  Brian O'Kelley (01:26): 

  Yeah. So what you're seeing in the dashboard is, how much money did I spend? How much carbon did that generate? And was it worth it? Was the performance I got worth the carbon? 

  James Kotecki (01:36): 

  Okay. And then do your clients define worth it in different ways, or is there a standard threshold for what worth it means? 

  Brian O'Kelley (01:45): 

  Well, if we ever standardized performance measurement, this whole event is done. 

  James Kotecki (01:48): 

  Okay. 

  Brian O'Kelley (01:50): 

  But no, we can look at this across any metric. Right? 

  James Kotecki (01:53): 

  Yeah. 

  Brian O'Kelley (01:53): 

  Instead of dividing your conversions or your return on ad spend or whatever by dollars, let's also divide it by carbon. 

  James Kotecki (01:59): 

  Yeah. 

  Brian O'Kelley (02:00): 

  And then the question is also, is it easy to get rid of? So if you're buying a bunch of ads that no one sees. 

  James Kotecki (02:05): 

  Yeah. 

  Brian O'Kelley (02:05): 

  So you buy a bunch of non-viewable advertising. That's wasting money and it's wasting carbon. 

  James Kotecki (02:10): 

  Yeah. 

  Brian O'Kelley (02:11): 

  And so we really look for actionable ways to reduce waste that happen to be both good for the pocketbook and good for the planet. 

  James Kotecki (02:18): 

  And I imagine that companies might want to adopt a platform like this in order to help to meet their promises for how much carbon they are planning to reduce. But my question to you is, once they start measuring this stuff, might they be reticent to measure it because it's like, "Oh, we never even measured this in the first place?" So when we had our initial promise, we had some baseline of what we thought we were admitting, and that didn't even include advertising because we just forgot to calculate that. And now we actually realize we have more work to do. 

  Brian O'Kelley (02:43): 

  Yeah. Well, a guy named Reuben Shroyers had a great term, which is FOFO: fear of finding out. And in Europe there's a regulation called CSRD that requires all major companies to report their emissions. This is actually sort of a solved problem in that any global company is already being forced by California, by Singapore, by Australia, by Europe. If you're doing business globally, you have to report your emissions, and that implies that you need to look at every material part of your business. 

  James Kotecki (03:12): 

  Yeah. 

  Brian O'Kelley (03:12): 

  And yes, there are certainly smaller companies that don't have the resources to do that, but I think folks are realizing that digital is a legitimately significant part of the carbon story. 

  James Kotecki (03:23): 

  And do you have a way of contextualizing, either quantitatively or qualitatively, how much worse of a problem things are now because of generative AI, as you mentioned? How much more electricity is that using? 

  Brian O'Kelley (03:36): 

  I just put out a blog post on this because I was curious about this. Based on some projections by McKinsey, by 2028, data centers in the US will use 580 terawatt hours of electricity, which is about 12% of the US total. That's the same as I think it was California, Texas and New Jersey combined. 

  James Kotecki (03:56): 

  Wow. 

  Brian O'Kelley (03:57): 

  That's crazy. 

  James Kotecki (03:58): 

  Now, that's all data centers, right? That's not necessarily just going into advertising. 

  Brian O'Kelley (04:02): 

  Correct. 

  James Kotecki (04:02): 

  Right. 

  Brian O'Kelley (04:02): 

  And we look at AI as well as advertising. They're both really significant. 

  James Kotecki (04:06): 

  Right. 

  Brian O'Kelley (04:06): 

  What's interesting is that ads fund the digital world. 

  James Kotecki (04:08): 

  Yeah. 

  Brian O'Kelley (04:09): 

  If you look at Meta, Google, they're almost 100% advertising. So if you think about advertising as the subsidized part of all this investment that Meta makes in AI. 

  James Kotecki (04:19): 

  Yeah. 

  Brian O'Kelley (04:20): 

  So if you can look at advertising as the supply chain, the downstream of the digital world, if you can influence advertising, you can influence the biggest companies in the world. And that's why CES is a technology show. But so much of technology overlaps advertising, it overlaps sustainability. This is really one conversation we're having. 

  James Kotecki (04:41): 

  When people start using your platform, do they find that low hanging fruit often? Are there typically things where it's like, "Oh, that's just a complete waste?" Are there easy things for them to fix? 

  Brian O'Kelley (04:49): 

  Oh yeah. In my past life I invented programmatic advertising. And one of the things I found building one of the largest platforms in the world was that there's a huge amount of waste in the programmatic ecosystem. 

  James Kotecki (05:02): 

  Yeah. 

  Brian O'Kelley (05:03): 

  And that's financial waste, that's carbon waste. There's so many low hanging fruits. 

  James Kotecki (05:07): 

  And programmatic was built to solve the waste problem from just spray and pray advertising, right? 

  Brian O'Kelley (05:11): 

  Exactly. But it created another problem. 

  James Kotecki (05:12): 

  Yeah, yeah. 

  Brian O'Kelley (05:13): 

  And so yeah, I feel like I kind of know where the bodies are buried. And you could say, "Well, Brian, you buried them." Well, we still got to dig them up. We got to solve this problem. And yeah, most people who work with us see 10%, 15% improvement in performance as measured by them, and 30%, 40%, 50% reduction in carbon. So there's a big opportunity. 

  James Kotecki (05:32): 

  And does this go hand in hand with the drive just to make AI and advertising generally more efficient? In other words, if you're working on solving the carbon problem, might you accidentally or intentionally also be solving other efficiency problems that will help you in other areas of business? 

  Brian O'Kelley (05:47): 

  Of course. 

  James Kotecki (05:48): 

  Yeah. 

  Brian O'Kelley (05:48): 

  And in fact, we solve the money problems and happen to solve carbon problems. 

  James Kotecki (05:53): 

  Okay. Yeah, yeah. 

  Brian O'Kelley (05:53): 

  If you think about buying, a third of your ads are non-viewable. If we could get rid of that, that's a third less carbon and a third less financial waste. 

  James Kotecki (06:01): 

  Yeah. 

  Brian O'Kelley (06:02): 

  And in AI, if you think about effective uses of AI, there's ways to use AI that are really efficient and really effective. I use it a lot, but when I'm engaging with AI it's, I believe, a fairly high value engagement. But there's a lot of things you could do that are not very useful or effective. Maybe we shouldn't do those things with AI. I can check the weather on my phone as opposed to asking ChatGPT, "What's the weather today?" 

  James Kotecki (06:26): 

  And do you think we'll get to a point, maybe now or maybe in the future, where there's that kind of societal individual awareness? Just like as an individual I'm encouraged to recycle, I'm also encouraged, don't use generative AI for certain things? Are we going to get to that point? 

  Brian O'Kelley (06:40): 

  I think it's all about money. Uber's a great example, where Uber was heavily subsidized in New York back when it started. It was way cheaper than a taxi. And so everyone was like, "Wow, it's easier to use and it's cheaper." And then one day Uber started losing billions of dollars, and they're like, "Actually, we should probably charge full fare." And Uber prices doubled. And now people are like, "Maybe I shouldn't drive a car." And then this week we have congestion pricing in New York, so the government's getting involved. So there's all these economic reasons that, maybe it's not the best thing to do to drive a car. 

  James Kotecki (07:12): 

  Yeah. 

  Brian O'Kelley (07:12): 

  So I think we're going to see all those things. We're going to see less subsidies from big tech. We're going to see consumers starting to think about this from a convenience and cost perspective. And we'll see the government plug in, either on the energy side or on the demand side, to make this a less no-brainer decision for consumers. 

  James Kotecki (07:27): 

  But from what you're saying, it sounds like there's what you believe are a lot of tailwinds for what you're doing that are maybe independent from necessarily the political whims of the moment. There's long-term trends here that, no matter who's in power, what administration nationally or globally, we're still going to be seeing these trends play out. 

  Brian O'Kelley (07:42): 

  Yeah. We're saving people tons of money. 

  James Kotecki (07:44): 

  Yeah. 

  Brian O'Kelley (07:44): 

  And so in any administration, if I can find you- 

  James Kotecki (07:47): 

  Everyone like to save money. 

  Brian O'Kelley (07:47): 

  Millions or tens of millions of dollars of cost savings, you're going to want to work with us. And if it happens to be great for the environment, awesome. 

  James Kotecki (07:54): 

  How are your conversations here at CES 2025? What have you been talking about? How have you been received? 

  Brian O'Kelley (07:59): 

  I've been blown away by the engagement with our team. I've been talking to extremely senior people about this and what they've said is this is a critical issue for them in 2025. And these are some of the biggest companies in the world saying, "We have to do something," which, I was worried that with the Trump administration and Elon coming out with a lot of anti-ESG noise, and big banks pulling out of climate agreements, are we seeing a shift away? 

  James Kotecki (08:26): 

  Yeah. 

  Brian O'Kelley (08:26): 

  And what I've seen so far is the opposite. That I think everyone's saying, "Look, we have to do this and we can't wait for the government to come make it happen." 

  James Kotecki (08:34): 

  Are you optimistic about the future, given where we are on climate change? 

  Brian O'Kelley (08:38): 

  I am optimistic in the medium term and I am terrified in the short term. 

  James Kotecki (08:42): 

  Okay. 

  Brian O'Kelley (08:42): 

  I think the next three to five years... AI is so powerful, it's going to get adopted. And I think that if you look at the government actions that should happen, they're not going to happen, at least in the US, right now. China's economy is not looking great. They may not be as aggressive on some of these issues. We may just not be quick enough. And the problem of an overshoot on climate is that the temperature's going to go up and it's going to be really hard to get it down. 

  James Kotecki (09:08): 

  Yeah. 

  Brian O'Kelley (09:08): 

  And that's going to impact hundreds of millions of lives around the world. And I get nervous. The weather is not the climate. The fact that there's fires in LA right now is not directly because of climate change but the fact that there's more fires in general, that is. 

  James Kotecki (09:24): 

  It's all connected. 

  Brian O'Kelley (09:24): 

  And so I just think we're going to cause a lot of human suffering unnecessarily, but we'll get there. 

  James Kotecki (09:30): 

  Okay. That was kind of terrifying in the short term, but I do like your medium term. Optimistic. 

  Brian O'Kelley (09:34): 

  Terrifying but optimistic, yes. 

  James Kotecki (09:36): 

  You mentioned in a previous life you started programmatic advertising. And I looked at your bio and I saw co-founder at least twice. Two other times, so three times total in your background. Is that right? You're a three-time co-founder? 

  Brian O'Kelley (09:48): 

  Yeah. 

  James Kotecki (09:49): 

  Does it get any easier to start something new? 

  Brian O'Kelley (09:52): 

  Yes. It does get easier because once you've sold a couple of companies for $1 billion, investors are like, "Yeah." Like, "Have some money." 

  James Kotecki (10:00): 

  Yeah. 

  Brian O'Kelley (10:01): 

  But the stakes are higher. 

  James Kotecki (10:02): 

  Yeah. 

  Brian O'Kelley (10:02): 

  So the pressure I feel to make this company work, because of the climate implications, are just so high. So I'm working harder now, I think, than I worked 10 years ago, which is weird because financially it's not as much of a driver for me. But I feel like this has to happen and there's nobody else doing it. So it's easier in some ways but it's just as stressful and I'm just as exhausted. 

  James Kotecki (10:28): 

  Well, thank you for taking a few minutes and spending it with us. Brian O'Kelley, Scope3. Thank you so much. 

  Brian O'Kelley (10:32): 

  Thanks for having me. 

  James Kotecki (10:33): 

  And thank you so much for watching. This is the C Space Studio. I'm James Kotecki. More conversations are coming your way, so don't go anywhere. This is CES 2025. 

  (10:42): 

  Well, I hope you enjoyed that conversation from CES 2025. That is our show for now, but there's always more tech to talk about so if you're on YouTube, please subscribe and leave a comment. If you're listening on Spotify, Apple Podcasts, iHeartMedia, or wherever you get your podcasts, hit that follow button and let's give the algorithms what they want. You can get even more CES at CES.tech. That's CES.T-E-C-H. Our show produced by Nicole Vidovich and Paige Morris. Our C Space Studio episodes are produced and edited by Cramer. I'm James Kotecki talking Tech on CES Tech Talk.