TVB Commits $5 Mil. To E-Biz Buy-Sell System

by David Goetzl, Feb 22, 2007, 7:00 AM

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At a time when the spot market is losing some of its 50-year-old luster, the local broadcast industry is looking to give itself a jolt. It is committing $5 million to develop a long-awaited system for electronic buying and selling.

The industry trade group the Television Bureau of Advertising, which for some time has lobbied for an e-biz system and faced multiple hurdles, says it now has the money and the support to launch a "TVB ePort" this fall.

TVB will oversee the building of the system over the next nine months until its fourth-quarter launch. At first, the system will provide for buyers to submit orders electronically for avails in the first quarter of 2008.

Soon after, the goal is to ramp up the system so it can process invoices and makegoods--even log times and traffic instructions--as it works toward transforming the entire spot buying and selling process into "a 100% paperless" operation.

The system eventually will facilitate and ease purchasing of on-air avails, as well as real estate on local stations' Web sites, mobile platforms, and digital subchannels.

The system, which meets with standards set by the AAAAs for e-biz, will be free to buyers. Its development will be funded by an already committed multimillion-dollar outlay by the National Association of Broadcasters. That figure is undisclosed, but the remainder of the $5 million pool will come from the local station groups.

"There is very strong broadcaster commitment to this project," said Paul Karpowicz, president of Meredith Broadcasting and TVB board chairman. "We are putting our money where our mouth is."

TVB President Chris Rohrs called the system's impending launch "a breakthrough" with the potential to resuscitate some of the lagging spot business. He believes some buyers have been deterred by the cumbersome, paper-oriented purchasing process. As a result, they may have been enticed by the multitude of other media now available and then shifted dollars.

"It's crystal-clear that some of the shrinkage of national spot is because of the process," he said.

TNS Media Intelligence projects that spending on spot TV will decline by 2.8% this year, although 2006 did bring heavy political spending and an infusion due to the Olympics.

Leading spot buyer Kathy Crawford, president of local broadcast at MindShare, said an easier buying system wouldn't necessarily encourage her agency to increase spending in the spot market, but would at least simplify operations for the buys it currently places.

"This is a very cumbersome business now," she said. "This is an effort to [improve] some of the process, and it's a very big step."

One of the hurdles TVB has faced in developing an electronic marketplace is synchronizing the various computer systems that stations and agencies employ. But executives said TVB ePort will be functional no matter what the system. TVB refers to it as "open-standards connectivity."

"Getting to a paperless environment is our mutual goal here," said Greg Smith, chief information officer at McCann Worldgroup. "We'd like to make decisions about what media to choose and not make corrections on what media we've bought."

Smith has been a fervent supporter of an e-biz system for transactions across all media--not just spot TV--and will moderate a panel on the topic next week at the 4As media conference in Las Vegas.

The "paperless" ePort system could be fully functional by 2009 or before, but it will not allow for electronic negotiations of deals. Those will continue to be done in traditional one-on-one, face-to-face fashion.

That contrasts somewhat from the eBay-enabled electronic buying-and-selling system that marketers are developing for the national cable and perhaps broadcast markets. That system will allow for some electronic (essentially e-mail based) back-and-forth before an agreement is reached.

TVB will soon solicit bids from technology providers to build ePort. A TVB representative said it's unclear whether eBay will be considered.

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