The sell-side initiative to create a joint industry committee has moved yet another step closer to becoming a true "JIC" -- at least in the sense of having both the buy and the sell sides represented on it, as well as establishing "baseline requirements" for any audience measurement service seeking to be certified as a cross-platform video trading currency in the U.S.
The JIC already has a critical mass of both sides, although there are some notable big names missing from both the buy (Havas, Stagwell or any individual marketer) and sell (Disney) and has effectively been ratified as an operational concept though it still needs to establish a nonprofit, legal entity to oversee it.
In the following Q&A, I spoke with OpenAP CEO David Levy about its formation and the baseline requirements, as well as next steps beyond it, and pointedly asked him whether having a new entity certifying ad-market currencies effectively usurps the longstanding role of the Media Rating Council (MRC), which has operated as the industry's self-regulatory stamp of approval for more than half a century.
Levy points out that a key requirement of being certified by the JIC will be that an ad-market currency must also seek MRC accreditation, but there is no explicit requirement that they actually complete that.
More specifically, I asked whether being certified as a currency by the JIC won't actually negate the need for accreditation, since an audience measurement supplier will already have an ad-industry stamp of approval? I mean, why go through the time and expense of a rigorous MRC audit and accreditation process if you've already been approved as a market currency?
Clearly, the new U.S. JIC still has some things to figure out, but I'm not sure any of its organizers understand what the implications are for having new multiple stamps of approval sanctioning multiple new currencies within a marketplace.
Call it certification, accreditation or a check mark. Heck, call it a double-check mark, if you want. The bottom line is it will create new nuances of industry acceptance at a time when I believe we need more, not less clarity about whether something is actually ready for prime-time. Or even on-demand.
You can read our coverage of the JIC’s initial requirements here, but here’s my follow-up conversation with Levy about its role vs. the MRC’s.
RTBlog: So once you grant conditional approval there will be additional audit requests to verify it. How is that going to be handled?
David Levy: There’s a more detailed RFI that is going out that will be used to capture all of the necessary information regarding the requirements that we’re setting forth. And the idea is that from there we will have a more detailed meeting to review the RFI to make sure we understand the answers. We might have some follow-up answers, but at that point we can vote to get conditional certification based on their answers.
That said, just because they might claim certain answers, there might be some things that we need to have independently verified.
Sometimes when you say the word “audit,” it has other kinds of preconceived notions. I think what we’re talking about here is having a third-party audit to verify some of the answers that need further verification or transparency.
So once you get conditional approval, there may be additional audit requirements on certain answers based on what you submitted. Then we will work to independently verify those answers. And then we’ll move from conditional certification to full certification.
RTBlog: When you say independently verify, are you going to source this through CPA-type auditors, or are you going to do it through the committee?
Levy: Yes, third-party.
RTBlog: So I have to ask you the straight-up question: Are you usurping the role of the MRC in any of this? That is historically the role the MRC has played. It doesn’t use the word “certification” -- it uses the word “accreditation,” but that’s what they do.
Levy: Well, they certainly are involved in audit, but I think we’re talking about definitely different things. One of the major requirements that we have is that you seek MRC accreditation. I think the MRC and what we are focused on are different aspects of the requirements that are needed for measurement. I think the MRC is certainly focused on very key and important things that are much more detailed, in fact, than what we are. And so a big part of what we’re saying is that MRC accreditation should absolutely still be [sought] separately.
And that audit process is going to be much more arduous.
I think what we’re talking about here is independent third-party verification of the information they provide. And that the information they provide is accurate.
RTBlog: I think I understand the distinction. You want to move faster to get currencies approved to be in the marketplace between the buy and sell side and the MRC process will continue on its own.
Levy: One of the big challenges right now is that all of this stuff is really new and there’s a lot of key important parts that we will need to better [ensure] transparency and understanding of in order to have our systems be able to properly and accurately guarantee campaigns.
The challenge is that right now we get individual salesmanship from a lot of the measurement companies about what they can do and what they can’t do, so what we’re trying to do here is collectively get the requirements of the things we need and try to get consistent answers back from everybody in order to understand where everybody sits.
The goal is not to be, “Hey you don’t meet these requirements, we’re never going to talk to you again.” I think the goal is to work with these organizations to get them to all be currency-ready.
I think just having more transparency between buyer and seller as you’re negotiating on where different currencies sit from a readiness perspective is core to having any negotiation. And one of those requirements is going to be seeking MRC accreditation.
I see those two things as completely separate. The MRC accreditation will be a much more arduous process -- a longer process. And we’re not necessarily involved. We’re encouraging and pushing to do it. But that’s something separate that they need to do.
RTBlog: I think the ANA’s Bill Tucker was right when he said recently that this JIC is operationally different from the way JICs operate in other parts of the world.
You’re not the one that’s sourcing the currency. You’re just certifying it. But this is an important question, and I want to be as explicit about it as possible, which is that the only thing that makes a currency in any market in any part of the world -- or in any industry -- is that two sides agree to do business on the basis of it. It’s not an MRC accreditation or a JIC certification. It’s different if a JIC creates a currency and the industry agrees to utilize that currency based on parameters and specifications that a marketplace creates.
And there is nothing now that requires any currency to actually be MRC-accredited. As we know, Nielsen is not [MRC-accredited] right now.
RTBlog: My question is, don’t you think it’s going to water down the meaning of accreditation if companies can get certified as a currency? If they’re already a currency, why do they need to spend all that time and money with the MRC to do what is effectively the same thing for the marketplace?
Levy: I understand your point of view on that. I think our point of view is that we are encouraging MRC accreditation and we’re going to continue to encourage MRC accreditation, but separately there are other things around systems transparency, and identity transparency, and around how certain things on a cross-platform basis are being done that we need in order to transact. And we need to move now.
We can encourage folks to seek MRC accreditation, but we also can’t just stop and wait for things to happen. We have to move.