The Future of TV Advertising

Tracks trends in traditional television ad sales and the impact of new technologies, new competition.

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Proven senior level executive with over 25 years of leading turnarounds and startups of software companies in media, finance, energy and business intelligence. See more at Linked In.

Wednesday, October 11, 2006

eBay - A Portent of Change for TV Sales

Wal-Mart and 117 other advertisers have been pushing an auction based TV ad sales systems, run by eBay, according to Ad Age.

The CAB (Cabletelevision Advertising Bureau ) is urging cable companies to participate.

We'll monitor this development. We think it is the right thing: good for advertisers, good for the owners of media properties. More price transparency, a greater sense of fairness ... should lead to "more efficient markets" and raise the amount of transactions.

This has been the case in many many other types of markets, the stock exchange being one of the prime examples.

Who will be the losers? Why hasn't this happened before now?

Answer: The traders. Sales people who now "manage the relationships", "assemble the right package" and take home $200K to $1 million a year for doing so. They have been a large part, and will continue to be a large part of the resistance to this phenomenon.

The buyers, who loved the perks of directing business (trips, tickets, dinners, etc.) are on the road to marginalization anyway, so there will be less "armed" resistance from them.

It's interesting that this is happening at the same time that the NYSE is finally starting to go to fully electronic trading. The scenes of the trading pit will replaced by colorful screens. And soon most, if not all, of the floor traders will lose their very lucrative jobs on the floor.

If the Wal-mart / eBay experiment succeeds, we have to see the same loss of high-paying sales jobs in the media companies. And it will be good for TV ad sales.

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