• by Tameka Kee , May 1, 2007

Yahoo's acquisition of Right Media could be a boon to interactive media planners, buyers and publishers--creating a streamlined marketplace for brokering integrated advertising deals, industry leaders said, responding to Yahoo's plan to buy the remaining 80% of the ad exchange it doesn't own for $680 million.

"Right now all the portals are talking about integration," said David Berkowitz, director of emerging media at 360i. "But this specific partnership puts both companies in a position to offer integrated search, display, and even behavioral ad opportunities." That is, if they can figure out how to bundle search and display advertising first.

Advertisers will be able to buy a broad selection of inventory from both Right Media and Yahoo's existing ad networks, in addition to stock created from partnerships the search engine recently announced with eBay and The McClatchy company, among others.

Selling their inventory as part of a bundle gives publishers the option of including premium ad space--such as a rich media sidebar--in a deal with less premium space, like a banner on an affiliate's blog.

While Yahoo specifically alluded to "deriving more value" from its own non-premium inventory, the partnership affords content-specific publishers such as bloggers and community Web sites the opportunity to effectively monetize their own inventory--garnering advertisers visibility with niche audiences.

Given the soaring popularity of interactive advertising, it's even feasible to see owners of out-of-home media like digitized billboards becoming part of the Yahoo/Right Media network--a factor that Berkowitz said "could make this deal really pervasive."

The other benefit specific to online media planners and buyers stems from the concept of an open marketplace--a factor insiders say is a key differentiator between Right Media and some other, larger ad exchange companies.

"Though Right Media is a relatively new brand, they placed a high value on transparency from the start," said Berkowitz.

One of the major challenges to negotiating in an auction-based marketplace is that aside from bidding price, mitigating factors such as click-through rates or the quality of a landing page are sometimes unavailable to buyers.

Yahoo's own Panama platform has been cited as an improvement by some, but one that detracted from its ad model's transparency--a factor that may explain why the words "transparency" and "openness" were repeated often by both CEO Terry Semel and Executive Vice President Sue Decker during yesterday's call with investors about the deal.

Some on the agency side, however, are waiting to see whether this partnership, like the GoogleClick deal, affects the ad exchange's neutrality.

"Now that they're owned by one of the largest sellers of space on the Web, does that make Right Media less of a middleman?" said Jeff Ratner, North American digital director of MindShare Interactive. "Will I find more of my inventory winding up on Yahoo as opposed to somewhere else?"

Although Decker also commented that Yahoo's shareholders shouldn't expect to see profits from this investment until at least 12 months after the deal closes, if the companies follow through on their immediate intentions to improve the marketplace, then media planners, buyers and publishers may see the changes quickly.

Still, interactive executives remain cautiously skeptical with regard to the immediate benefits.

"I haven't seen a significant impact to either company since the original partnership," said Steve Kaufman, senior vice president of media for Digitas. "But if Right Media's ad exchange helps Yahoo to provide more of the integration we've been asking for, then it's definitely an advantage."