Federated Media

The Mouse Click That Roared.

The Mouse Click That RoaredI haven’t always agreed with John Battelle, but ever since we worked on opposite coasts for Wired Magazine in 1994 I’ve had no doubt that he was an ambitious and provocative thinker.  “The Search” is required reading for anyone trying to understand the center of gravity in the digital age.  And now, on his “searchblog,” John offers a very original and refreshing take on the lasting global contribution of… the banner ad.

“Why the Banner Ad is Heroic, and Adtech is our Greatest Artifact” offers up a truly original thought:  Long after actual banner ads fade from memory (much the way television cigarette ads have at this point) the infrastructure created to deliver them will endure, serving mankind in a myriad of ways.   “Programmatic adtech is the heir to the database of intentions,” Battelle writes.  “At present, the end result of this vastly complicated “Request – Process – Response” system is, more often than not, the proffering of a banner ad. But that’s just an artifact of a far more interesting future state.”   The man is right.  Currently a click on a link, the call of a page or a bit of mobile content catalyzes billions of computing cycles to process a personalized response.   The process itself is an awesome accomplishment.  That we are currently using it to carpet-bomb consumers with redundant direct-response ads and follow them around the web with their abandoned shoe purchases is beside the point:  those are symptoms of our lack of imagination.

This week’s Drift is proudly underwritten by PubMatic. With PubMatic’s platform, publishers have the ability to offer their inventory to over 400 global Demand Partners – ad networks, demand side platforms, ad exchanges, and agency trading desks – and have on demand access to all the software, tools and services they need to realize the full potential of their digital assets.


Battelle imagines a world in which the stimulus won’t be a page request,  but rather a decision made in a retail shop or the filing of a health claim.  And the processing will yield rich troves of information, content, choice…context.  “What we today call ‘adtech’ will tomorrow become the worldwide real-time processing layer driving much of society’s transactions,” he writes.   It’s enough to make one proud to have been part of our pedestrian beginnings!

I can’t improve on John’s meme, so I’ll just offer a mid-range simplification.  I’ve thought for many years that ad-serving/adtech was an awesome delivery system which could be used to ship far more interesting stuff.  Sticking close to marketing and advertising, we’re already seeing companies like Outbrain using ad-like-tech to intelligently distribute content.  But that’s just the beginning.  In the near term, I believe we need our digital publishers, marketers and agencies to shed the intellectual strait-jacket of “ad delivery” and move into the information delivery age.  Anything and everything can move through the pipes we’ve created.  The only bottleneck is our own imagination.  I’ll close with something I wrote back in 2005, which seems like an appropriate call to arms:

The tail has already started to wag the dog. Nearly all of the really interesting and important questions in the media world are either being answered online… Now is the time for a new level of dialogue with marketers; a dialogue rooted in confidence and opportunity.

Thanks John.  And Happy Thanksgiving to all.

We Love a Parade.

Over the past week, I’ve been asked at least a dozen times about Federated Media’s much ballyhooed decision to “shutter” its direct ad sales business in favor or “programmatic buying and native advertising” businesses.  In Adweek, Tim Peterson described it as a move that “…could presage a foundational shift in the online advertising landscape.”

To which I would say, “Settle down Tim.”

Because of Super-Storm Sandy, The Upstream Seller Forum Dinner was rescheduled for Wednesday night November 28th and The Seller Forum to Thursday November 29th at the Thomson Reuters Building.  Because of the change, a handful of seats have become available for qualified CROs, EVPs, SVPs and VPs of sales.  If your company would like to be represented at this important event, please reach out to us right away.

Let’s look at the facts.  While the business press loves a good paradigm shift story — and Federated would very much like to run in front of the parade that’s already forming — individual publishers are making these kinds of decisions every day.  Just without the grandstanding.  In the Upstream Seller Forum events we host, there’s been a thoughtful running debate for close to four years around the role of ad exchanges and programmatic channels in the publisher’s world.  To these thoughtful publishers, the revenue world looks like a series of dials and switches to be carefully turned and calibrated.

So why the big announcement and all the breathless press coverage and Twitter chatter about Federated?  In one of her press interviews, CEO Deanna gave a pretty good indication when she pointed out “…when you’ve got an independent company like ours that’s venture-funded, we need to make bets that we know will [see] return.”   I would suggest that the “return” in this case is actually ROIE:  Return of Investor Enthusiasm.  Federated and its bombastic founder John Battelle have always had a bigger profile on conference stages and inside the boardrooms of Sand Hill Road and Silicon Alley than they have in the daily give and take of the media and advertising world.  Tying the company’s future to a press release that includes both programmatic and native makes all the sense in the world.

In the past five years, the venture community has been over-funding the ad technology space with the subtle precision of drug dealers handing out stacks of Benjamins.  Some kind of “validating event” — like, say, a high-profile publisher firing her high priced sales team and betting everything on technology and self-service — is the hopeful narrative that keeps the house of cards standing a while longer.  But the quiet, careful recalibration and streamlining of the media and marketing worlds has been going on for years, and will continue for years more.  It’s not as sexy and dramatic a story, but it’s the truth. The revolution will not be televised.

Will the programmatic, data-enabled buying and selling of ads be a bigger part of our business?  Absolutely.  Is “native advertising” also a meaningful growth area?  The jury is still out:  if it is, it’s influence will be unevenly distributed to a handful of players.  Is it time to start firing direct sellers?  That’s laughable.

Will we continue to over-react to showy press releases and other forms of corporate misdirection?  That’s up to us.