NEW YORK: In a surprise move the US cable TV industry has withdrawn from the Online Media Exchange - a pilot ad sales scheme run by eBay with the backing of a consortium of advertisers, among them Brown-Forman, Hewlett-Packard, Home Depot, Intel, Lexus and Microsoft.
The scheme, reportedly funded to the tune of $50 million (€37.37m; £25.44m), is said to be the brainchild of fallen Wal-Mart marketer Julie Roehm. It was set-up last fall with the support of the Association of National Advertisers and the American Association of Advertising Agencies [WARC News: 13-Dec-06].
What triggered the Cabletelevision Advertising Bureau's pull-out? Says president/ceo Sean Cunninham: "One picture was clearly emerging and it was universally negative."
The networks - among them Discovery, ESPN, Lifetime, and Turner - believe the process failed to incorporate key elements of the buying process.
According to Cunningham, many present-day media deals involve complicated product integrations. Moreover, the eBay system didn't allow for such deals to have web, promotional or retail extensions.
The advertiser consortium declared itself "disappointed" by the CAB's decision, although it insists it will "continue to pursue cable networks and [is] confident that the eMedia exchange will have traction with cable and other media."
The CAB pullout also has wider implications, particularly at Google, which has also fixed its profit-hungry gaze on a digitized media selling and buying system.
Comments Greg Smith, North Amertican coo at WPP Group-owned digital shop Neo@Ogilvy: "Google is going to realize not everyone is rooting for this."
Data sourced from Wall Street Journal Online. additional content by WARC staff