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Aussie obstacles for programmatic radio

News, 05 February 2015

SYDNEY: The requirement for Australian radio stations to serve the same ads on any secondary streams as they do on broadcast is holding back the development of programmatic in this area according to an industry figure.

Existing legislation needs to change, Marc Lomas, managing director of marketing service platform Cadreon Australia, told Ad News.

"A key use case for programmatic is the ability to increase yield by delivering different creative based on audience/device/location etc," he said.

But that isn't possible under current rules relating to the Phonographic Performance Company of Australia (PPCA), the country's collecting society for music copyright owners. These, Lomas asserted, were "hindering the channel progressing and competing with other channels that are moving along the same path".

Radio stations and record labels have clashed on another interpretation of this issue in the past, with the PPCA demanding royalties be paid on radio internet simulcasts as well as those on normal radio broadcasts; stations objected to having to pay twice.

Cadreon already operates in programmatic outdoor and Henry Tajer, chief operating officer of parent group IPG Mediabrands, expects that programmatic radio will be even more successful.

"Radio people are very innovative and radio is a successful channel as it is, so there's a strong opportunity there," he said.

A bullish Lomas added: "A pinpoint audio ad delivered based on audience type and location is gold for advertisers."

It is a market that is certainly set to develop: late last year, TubeMogul announced plans to launch a programmatic TV platform in the country. "Radio is an inevitable step for us," said managing director Sam Smith. "Our continued goal is to build an independent (media agnostic) audience trading platform."

In the US, Jelli has pioneered programmatic radio and co-founder/CEO Mike Dougherty explained to Radio World why it was the future: as programmatic buying surges in other media, advertisers want to be able to buy radio in the same way.

"If I'm spending a lot of money on Facebook and a display ad campaign, that's pretty effective, but boy, wouldn't it be nice to reach someone in the car because I'm an advertiser who perhaps is a retailer, and they can drive to my store," he said.

Data sourced from Ad News, Radio World; additional content by Warc staff