• by Michael Drexler , March 26, 2001

By Michael Drexler

Ever play the Shell Game? You know, three cups, a peanut shell and a fast pair of hands that move the cups around to make you wonder which cup the shell is under. To me, it's a little like spinning integration, consolidation and convergence when it suits the seller rather than the buyer. On the streets of New York they play a similar game called Three Card Monty. Two black cards and a red one. You bet at least twenty bucks to figure our where the red card will end up after the fast hands move them around. You could lose your shirt because the guy who controls the game is not only street smart but very proficient at the table. Much like the guy who controls the distribution controls the media. And if he also controls the content you're really at his mercy.

What I see today are a lot of media companies going around telling anyone who listens that they've got a better mousetrap because of integration, consolidation or convergence. Trouble is, they use them synonymously and the three are not the same. But they are used interchangeably depending upon who's selling what.

A recent executive at Time Warner said the merger between AOL and Time Warner would be better for advertisers because of the convergence between print, broadcast, cable, movies, books, records and online media. While in the long run that may be true, today it is not convergence. It is really a consolidation of assets with economies of scale that have yet to be developed synergistically to benefit advertisers. It is more like a menu or laundry list of media outlets that are looking for the infrastructure that develops them cohesively as marketing tools. Don't get me wrong, AOL-Time Warner is on the right track. As I see it, they are ahead of the game in this direction as I look at other media behemoths such as Viacom, Disney, Hearst, News Corp. and others. But what advertisers are really looking for is integration because it is only integration that makes the whole greater that the sum of its parts and delivers more marketing leverage for advertisers.

Many media buyers today have mixed emotions about consolidation. Some think it diminishes competition and puts too much control in the hands of too few. Consequently, they feel there will be an inflationary rise in prices as more inventory is controlled and manipulated in the marketplace. Others, however, see it as a benefit for advertisers because of the opportunity to offer multi-media programs and added value enhancements.

But, back to convergence for a moment. Bringing things together to meet at the same point, whether it's systems, products or ideas is still not integration because it lacks the process of systematically developing a marketing solution for advertisers. Only integration can do that. Let me make it clear. The integration process is as much the responsibility of the seller as the buyer and it's the only way media companies will succeed with advertisers.

From the advertisers standpoint it'