• by Wayne Friedman , Staff Writer, April 12, 2013

Traditional TV and media companies continue to want to move into the digital world quickly. But a surge in programmatic ad buying is sending out some alarm bells.

At the recent National Association of Broadcasters annual conference in Las Vegas, a few executives on a industry panel were concerned that real-time bidding for advertising can hurt the bottom line.

Roger Keating, senior vp of digital at Hearst Television, said he has seen an "alarming" number of non-renewals of clients in its larger markets, as advertisers move to buying real-time advertising -- presumably instead of buying Hearst's direct sales efforts.

What to do? What many publishers have done -- control the "pipeline," the premium video content that advertisers desire. Many TV stations are, for example, streaming much of their evening local newscasts -- the premium video content advertisers still want to be attached to.

TV stations have used authorized TV stations sales reps for decades -- but real-time bidding equates to the dreaded "commoditization" of advertising inventory.

Some TV digital selling executives are essentially saying, "deal with it." One Gannett Broadcasting executive responded that "It's not going to go away," advising the best approach is to control "the pipeline."

Trouble is, if TV sellers avail themselves of real-time ad network sales representatives, video inventory will be managed well. But others fear it will severely under cut their revenue -- as well as putting the pressure on their TV station digital competitors, as Hearst seemingly found out.

Big premium video publishers -- like ESPN, and others -- won't subject themselves to digital ad networks, nor programmatic buying. Local TV stations feel they’re are in the same category, especially when it comes to valuable local TV news content.

But if traditional TV marketers -- now TV digital marketers -- continue to look for cheaper alternatives to handle their inventory management, the rubber will meet the road. Perhaps driving away.