Buyers – Yes, Even Big Agencies – Need Online in Order to Restore Competition.

Sad though it may seem, we may look back on the 1990s as the pinnacle of traditional media diversity. The hugely successful 90s saw the profusion of cable, syndication, satellite, additional major networks and an attentive government making sure single corporations didn’t buy up regional markets to prevent competition of ad inventory (or speech).

But the current Administration doesn’t have the appreciation for competitive markets that most media buyers do. John Gaffney pointed out yesterday that the recently released FCC studies don’t find any problems with consolidation in radio, which is sort of like saying Cornelius Vanderbilt II made the trains run on time. Only now do we realize we are on a fast toboggan ride down the hill of previous Administrations’ achievements.

An ideological aside: I’m no liberal pansy when it comes to regulation – in fact, I’m more of a libertarian. But since the government controls the broadcast spectra already, any operational regulations will naturally encourage consolidation. I believe that calls for a more alert concern about media antitrust.

The good news for us buyers is that we’ll have fewer reps trying to set up lunches every day. The bad news is that we have fewer options and less price competition. Unless, of course, we open up to other media where cornering the impressions market is just about impossible. Right now, the online media can provide an escape hatch for advertiser dollars that seek a higher efficiency than traditional media conglomerates are willing to provide.

This requires advertisers and agencies to look agnostically across the media, however, figuring out how to value one type of impression against another. We haven’t proved very adept at this, partly because of a lack of standards (thus, the GRP debate), but mostly because there exists a political boundary within buying organizations between traditional and online. This DMZ that sits astride the would-be fluid flow of ad dollars that normally flows down toward the lowest cost per result.

The silver lining to over consolidation in the media world is that this artificial political boundary between traditional and online becomes more and more untenable.

By Tig Tillinghast
Courtesy of http://www.MediaPost.com