Task Force Set To Unveil Electronic Trading System, Outreach To Media

An ad industry task force exploring the development of a controversial online trading system for buying and selling traditional media is set to announce preliminary details as soon as today, executives involved in the discussions said. The next phase, they said, would focus on quelling concerns of big media companies such as the major television networks that participating in the electronic trading system will not "commoditize" the value of their medium and drive down prices for their advertising inventory.

Instead, one of the members of the task force - a group comprised of representatives from the Association of National Advertisers and the American Association of Advertising Agencies - said the goal is to improve things like workflow with an eye toward reducing paperwork and labor costs associated with processing media buys.

"We spend far too much time with the sales teams negotiating over pennies, nickels, and dimes," says Steve Grubbs, CEO of PHD USA. "It's a long, drawn-out process. This will create a more efficient process."



The task force has met with a number of potential suppliers and in May tapped eBay to provide the backbone for a test of the system. The test, which is slated for early next year, is expected to focus on network TV, though reception among the major TV networks has been chilly, with some top TV executives going on record that they would not participate.

The initiative, which grew out of an idea originally proposed by former DaimlerChrylser ad executive Julie Roehm during the ANA's 2005 Television Advertising Forum, has continued to groundswell and taken many shapes and forms over the past year-and-a-half. Roehm, now senior vice president for marketing communications at retail giant Wal-mart, has dubbed the concept a "Nasdaq" for media, alluding to one of Wall Street's famous electronic trading systems. Despite fears among some major media suppliers, and some infighting among big advertisers, the idea appears destined to manifest in at least some formal test, though the scale, and who would participate, remains unclear.

During the ANA's Financial Management Forum earlier this year, members of the task force floated the idea of a $50 million test and called on members to support it.

The initiative is part of a broader push by the ANA and the AAAA to move toward greater electronic trading of all media under their so-called "eBiz for media" banner. The primary goal of those initiatives is to improve processing of media buys, reduce the industry's historic paper shuffle, and manpower costs. The TV industry, especially the spot broadcast and cable network sectors, in fact, has led those initiatives and has achieved many of the key elements for electronic trading requested by the ANA's and AAAA's eBiz task force. Other media are still playing catch-up, especially the Internet.

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