MediaBank-DDS Merger Industry Reaction: Questions Remain About MediaOcean

mediaocean industry reactionOn Sunday, Donovan Data Systems and MediaBank announced their intention to combine their efforts as providers of back office systems that manage transactions across digital and traditional media buying channels. Read more. asked a selection of executives regarding their “take” on the proposed merger pending regulatory approval.

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Jack Klues, CEO, VivaKi (Publicis)

“Our focus for MediaBank and DDS is for a contemporary and automated bill / pay operation for all media buying – digital and more traditional. This is why we have gone with Mediabank in the US.

When we helped champion MediaBank into this market 5 years ago, we think it ultimately benefited both VivaKi and our clients. It seems that having two choices for ‘backroom’ worked well.

We understand the pace and tech pressures tomorrow’s marketplace will likely put on such systems supporting all phases of the media buying process. MediaBank and DDS together may be a good idea if systems will be truly open and can be more quickly brought to us in a way that we require. We will be interested in how their proposal develops.”

Joe Zawadzki, CEO, MediaMath

“Brilliant, at least in theory.

Execution will be critical. This is true for any company, but these two businesses especially given the merger-of-equals dynamic. Can both companies move beyond workflow management into informing decisions (while stopping short of threatening the roles of their client base)?

Interoperability will be critical for companies going forward – ­how aggressively will they actually pursue this, given a historical bias toward being closed?

These are some of the key questions, but it’s a great move for MediaBank and Donovan, and could be great for the broader market.”

Steve Katelman, EVP Global Strategic Partnerships, Omnicom Media Group

“Data has always been tied to back office functions—however in the past, the simplicity of that data has left those functions relatively uncomplicated. Now, the increasing depth, speed, and fragmentation of data is pushing existing solutions to its limits. It was already a challenge for DDS and MediaBank to solve those issues as separate companies—I’m cautiously optimistic that this merger will bring the best of both organizations together to provide an optimized solution.

That said, the merger arouses concerns around how MediaOcean will prioritize innovation-in what areas, and if at all. There is a lot of talk around the ‘agency operating system’ (or AOS), and this merger undoubtedly re-contextualizes the landscape. Some believe that the AOS can be delivered by a single organization—while others desire to be best-in-class for a specific function within the operating system. It remains unclear where MediaOcean will set its sights in this regard, and what path they will take to get there. Given the instant ubiquitous use of MediaOcean across the ecosystem, it may be tempting to sacrifice innovation of existing billing solutions (which yes, still do need innovation) to focus on areas outside of DDS and MediaBank’s traditional strengths.

This could be a mistake. While many companies sell themselves as AOS’s, a true holistic solution is tough to build…some companies have done good jobs at providing pieces, but no one has really figured out the whole thing. Considering back office functions alone, the industry still needs better solutions around tag implementation, scalable technology integration, discrepancy resolution, and ad trafficking (the latter of which seems to be understood by DG FastChannel given their recent acquisitions). Further, as the lines between back office and front office fade, a unified operating system must improve the integration across billing, delivery, and performance.

The industry demand for a unified ‘agency operating system’ is still out there. Bringing together two of the biggest back office players will go a long way towards achieving such a solution. That said, MediaOcean has a lot of work ahead. They are playing in a highly competitive and fast-moving space, and will have to continue to introduce and evolve new customer solutions. Can they handle this while still addressing the typical challenges and logistics of bringing together two large companies?”

By John Ebbert

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