Supplier Of The Year: OpenAP

While several of this year’s award winners tackled the two biggest media-buying challenges facing advertisers -- information asymmetry and misaligned incentives -- OpenAP leveraged both, although not necessarily in the best direction.

The result was that it convinced the demand side (mainly big media-buying agencies) to support a cohesive effort by the supply side (mainly the big network TV sales organizations) to launch what it dubbed a “JIC,” or joint industry committee to certify new, alternative advertising currencies they would be paid on.

In the simplest terms, OpenAP -- which is owned by Fox, NBCUniversal, Paramount Global and Warner Bros. Discovery -- convinced the big agencies to help them grade their own homework.

In fact, OpenAP’s campaign to launch the U.S. JIC followed years of independent efforts by its multiple owners to begin certifying their own currencies to replace the ad industry’s long-standing common currency of Nielsen ratings.

On the surface, the networks groused about the exorbitant cost of licensing Nielsen’s near-monopoly data, as well as the methodological flaws of an audience-measurement system built for measuring TV nearly half a century ago -- things that both the demand- and supply sides of the marketplace could agree on.

But the underlying motive was that after years of watching big digital platforms -- companies like Google, Meta, Amazon, etc. -- develop, control and certify their own homework, the networks saw an opportunity to convince a new generation of media buyers to accept the same from the TV industry, especially as they were retooling their own business models from linear TV to a cross-platform marketplace.

Nielsen certainly didn’t help its own case, bungling the timing of its own transition to a new, made-for-the-21st century audience-measurement platform, and losing Media Rating Council accreditation during the process.

The problem was that for better or worse, Nielsen’s near-monopoly ratings were effectively a common currency that all sides could agree to disagree over, but despite their flaws, they were a rare form of information symmetry in the U.S. advertising industry.

So Nielsen more or less opened the door, and OpenAP took the opportunity to step in.

And after years of independent efforts by individual networks to soften the ad industry to self-certification, the agencies were already predisposed to OpenAP’s JIC pitch.

In fact, MediaPost recognized one of OpenAP’s owners, NBCUniversal, as our supplier of the year last year, for its own successful campaign convincing big agencies to accept its own certification process.

OpenAP simply took it to a whole new level.

Instead of an ad hoc, vendor-by-vendor approach, OpenAP convinced Madison Avenue to not only become part of a new industry body to certify their trading currencies, but to actually call it a JIC.

Even that branding -- calling the initiative a JIC -- was a form of information asymmetry, because the term itself has long had an explicit meaning in the rest of the world where JICs are operational and are structured more or less in an explicit way giving equitable, if not equal, control across all three of the parties involved in the advertising measurement and trading process: media suppliers, media buyers and perhaps most importantly, advertisers.

From its beginning, OpenAP’s JIC was never structured that way. For one thing, OpenAP launched it without any demand-side participation, although it said it planned to involve agencies and advertisers.

In fact, until OpenAP announced in May 2023 that big agencies including Dentsu, GroupM, Havas, Horizon Media, IPG Mediabrands, Publicis Media, Omnicom Media Group, RPA and Stagwell had become members of the JIC, MediaPost had put quote marks around the term “JIC.”

And while it still didn’t have advertisers directly involved, OpenAP initially said the Association of National Advertisers (ANA) would have a seat at its table -- effectively making it tripartite, with sellers, buyers and advertisers having an equal vote.

By October 2023, when the JIC held a panel discussion at the Advertising Research Foundation’s Coalition for Innovative Media Measurement conference in New York City, it still wasn’t clear whether the ANA was actually playing such a role.

The panel opened with a slide listing the “participating companies,” including the names of networks, media-buying agencies, TV trade association Video Advertising Bureau, and OpenAP, and included CIMM and the ANA at the bottom under the words “With coordination across…” (see photo above).

Asked by MediaPost whether the ANA was in fact playing such a role, a senior ANA executive in a position to know said that was not true, seemed a little miffed, and implied he was going to somehow set that record straight.

While the exact nature of the ANA’s role in the JIC -- and whether advertisers in fact have any direct role voting on who gets certified and why -- remains unclear, ANA Group Executive Vice President Bill Tucker likely characterized it best when he introduced a panel discussion about the role of the new U.S. JIC at the ANA’s annual media conference in February, describing it as having a “different operational structure than international JICs,” and leaving it at that.

But the information asymmetry surrounding the JIC persisted, and by the time OpenAP hosted the JIC’s first “upfront-style event” in New York City in April, it was evident in the opening panel.

“Four months ago, this acronym was born,” moderator Michael Kassan said in his opening remarks.

Kassan, who is chairman and CEO of management consultancy MediaLink, is considered one of the smartest and most powerful people in the advertising industry, yet even he somehow did not know that the concept of a JIC has been discussed, debated and even attempted in the past for nearly half a century in the U.S.

Most international observers would actually characterize what OpenAP successfully pulled off as a MOC, or a “media-owned committee,” although with agencies on board, even that definition isn’t the most symmetrical one.

An expert on all such committees, Olympic Media Consultancy’s Tony Jarvis came up with his own, unique acronym to describe OpenAP’s version, dubbing it a M-CCC for a “multiple currency certifying committee” -- which is both ironic as well as an oxymoron, because true JICs normally work across industry stakeholders to design and source a single unifying currency that all parties can agree on.

To be fair, the multiple alternative currencies marketplace is spawning plenty of examples of innovation, including Dentsu’s proprietary media allocation system utilizing VideoAmp, one of three companies that have received “conditional certification” from the U.S. JIC.

And then there is eyeglasses marketer Luxottica’s innovative use combining geolocation data from Cubiq with CTV audience estimates from VideoAmp to target viewers based on actual traffic to Luxottica’s retail store locations.

Such efforts should be applauded, and in truth, a big part of the criteria for these annual awards is actually demonstrating new, innovative uses of media. So in a way, OpenAP has helped jumpstart much of that.

On the downside, it likely has contributed to one of the greatest -- if not the greatest -- information asymmetries ever in the U.S. advertising marketplace.

Time will tell how that plays out in the long run, but in the near term, OpenAP has disrupted the U.S. ad marketplace in a way its network TV owners could only have dreamed of.

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