Real Media Riffs - Tuesday, Oct 24, 2006

TO HAVE OR HAVAS NOT -- Maybe news travels slower than we thought in Western Europe, but we would have thought that the re-bundling - or at the very least, the re-integration of media services - had reached as far as Suresnes, France, and Barcelona, Spain. Apparently not. Barely a week after one of the world's largest ad agency holding companies - Interpublic - shook things up and reversed the trend toward centralizing media services, another - Havas - has unveiled plans to consolidate its media holdings under a new corporate-level entity. But the timing looks weird, coming years after the other holding companies have already formed centralized media units, and as some seem to be backing away from them. Is Havas Media late to the party? Or does the French-owned, Spanish-controlled media operation know something the rest of the world does not? Could it be that the company is poised to make an acquisition that would necessitate a media services holding structure, like say the one Aegis Group already has in place? Now that would make sense.



But upon inception, Havas Media's assets will primarily be MPG, MPG's Media Contacts unit and a new sleeper media network brand called Arena that apparently only operates in a few markets. Unless Havas plans to bolster that with some acquisitions, it seems like an awful lot of overhead - or ego - for what has been a fairly flat operational structure. After all, ridding itself of unnecessary corporate overhead was one of the more compelling reasons for Interpublic to phase out Interpublic Media. As smart a guy as the unit's CEO Mark Rosenthal is, does an agency holding company really need CEOs, CFOs and who knows who else micromanaging the output of what historically have been fairly autonomous media shops? For Interpublic, the answer was a decided "no."

That's not to say that some corporate-level oversight isn't a good thing. It just need not be a bloated thing. And it certainly should not be a meddlesome thing. We suspect it makes sense for organizations like WPP's GroupM, which now manages four disparate service brands - MediaCom, Mediaedge:cia, MindShare, and Maxus - and which may soon add more. It probably makes sense for Publicis Groupe Media too, though Publicis has been loath to formalize the corporate media hierarchy too much, even with Starcom MediaVest Group, ZenithOptimedia and fledgling Denuo. Of course, Publicis also may be in the market for Aegis, which would change the composition of its media operations considerably. As for Omnicom Media Group, well, we suspect it really means OMD + PHD.

Don't get us wrong. It's not that we don't think media is important enough to have a seat at the holding company table. We're just not sure it should be ghettoized. Maybe it should be re-integrated the way Interpublic is seeking to do it, breaking down walls between brand agencies and media agencies, and aligning them for a common good. Why create a new level of bureaucracy? Does that foster better media service and smarter media strategies? Does it help integrate media with message? Frankly, we're not sure, but we'll be keeping a close eye on the situation.

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