Saturday, May 13, 2006

eBay Wins Bid To Test Online Media Buying System

eBay Wins Bid To Test Online Media Buying System
by Erik Sass, Friday, May 12, 2006 8:30 AM EST
DAYS AFTER AN AD INDUSTRY task force unveiled plans to test an electronic trading system for buying and selling media, online auction giant eBay has won the bid. "We've looked at a bunch of providers, and eBay came out on top," confirmed Ray Warren, president of Carat Media Group Americas, and a member of the task force. While the task force has met with a number of potential infrastructure providers, including Google, Warren said eBay was chosen "based on their scale and their expertise and their brand name, which comes with some credibility in doing this kind of thing. Obviously, we wanted to make sure we get it right."

eBay first pitched the concept to the Association of National Advertisers' Television Advertising Committee in January, and presented the idea again in a more public form earlier this week during the ANA's Financial Management Committee meeting in Naples, FL.

Details of the test were not disclosed, but it looks to be fairly substantive. The task force has floated a $50 million budget for the test phase.

The idea is still being vetted through the ANA, which is conducting additional surveys of its membership to gauge support, and a formal steering committee has yet to be organized, but the initiative appears to be taking on a life of its own.

The concept of creating a Nasdaq-like media trading system was first broached by Wal-Mart's Senior Vice President For Marketing Communications, Julie Roehm, during the ANA's 2005 Television Advertising Forum in New York more than a year ago, while she was a senior marketing executive at DaimlerChrysler.

The idea is not without controversy, as some of the largest national advertisers are opposed to the idea, and the ANA is not formally endorsing the pilot program--although it is a big proponent along with the American Association of Advertising Agencies for so-called "eBiz for Media" systems, and it plans to serve as a forum for discussing the idea through its committees and at forums such as the Financial Management Conference.

Meanwhile, smaller online ad companies have joined the fray--with an announcement from Bid4Spots, an online ad broker that uses an innovative "reverse auction" model, that it plans to branch out into TV ad sales over the next year, according to founder and CEO Dave Newmark.

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