It appears the advertising world is starting to get physical about the pending integration of Google and Yahoo advertising – a deal brokered amidst Yahoo!’s flirtation with Microsoft regarding acquisition of the struggling Sunnyvale company.
As Erica Morphy details in her E-Commerce Times article, traditional advertisers, agencies and its lobbying arm, the Association of National Advertisers (ANA), are getting the message that a Google-Yahoo deal is bad for everyone except Google.
Anti-trust allegations against the Big G have continued to surface and yesterday’s WSJ added to the pile-on with their own coverage of the ANA announcement and paraphrased the head of the ANA, Bob Liodice, as saying that on balance the proposed deal is a negative for advertisers as search concentrates in the hands of Google.
The ANA says that 90% of search advertising occurs with Yahoo! and Google on aggregate.
Representing the advertising exchange industry in the E-Commerce Times article, Mark Kahn, CEO of Traffiq touched on a key ad exchange theme: openness. Kahn said, “Google has long abandoned the open bidding environment…Ultimately, what they are trying to do is drive more revenue for themselves.”
Very true. Advertisers are welcome to bid whatever they want with Google, but that’s where the freedom ends. Advertisers don’t know the price at which a publisher is selling nor do they know how much margin Google is grabbing while acting as a middleman. Publishers get what they’re given. To date, it has been a great model for all – especially Google – but the advertising exchange model changes things.
In an ad exchange, of course, transparency provides full recognition of pricing prior to the transaction.
The marketmaker, like a Google but not a Google, provides the tools of the marketplace so that advertisers and publishers may trade. Publishers and advertisers know what they are buying or selling, and at what price, as well as what the marketmaker is getting. The increased transparency breeds efficiency for advertiser and publisher. Budgets and yields become streamlined and optimized.
Everyone makes more money. Everyone spends more money. No blackbox.
Ad exchanges. Drink the Kool-Aid. But, we digress.
Looks like Google is about to meet the Justice Department, in public. Will they eventually get hammered like Microsoft in the 90s? Time will tell.
