What If Yahoo Sells Right Media? Agencies React

  |  March 19, 2012   |  Comments

Offloading the exchange might be fine, so long as inventory remains intact.

Yahoo may sell off some of its ad platforms, according to a report last week from AllThingsDigital. The move is seen as an alternative to investing resources needed to upgrade the platforms.

The post states any deal could include the Right Media Exchange and Yahoo's APT ad platform, which is used mainly by newspaper consortium partners. The list of potential buyers includes usual suspects like Microsoft and Google, but other aspirants could be waiting in the wings too.

Such a move wouldn't exit Yahoo from ad technology entirely. The company owns a large portfolio of ad products, including Blue Lithium, Dapper, and a huge ad optimization platform - each of which has a technology component. However the sale of Right Media in particular would change the company's role in the ad-buying ecosystem.

ClickZ polled some senior agency execs about the development, asking how it affects their perception of Yahoo as a media opportunity. Those representing trading desks largely shrugged off the impact of Yahoo shedding Right Media, but said inventory availability could become an issue.

"As an advertiser, we're less concerned about the technology and more concerned about the inventory changing," said Leo Dalakos, VP, strategy and analytics at Performics. "Right Media has probably the most extensive selection of high-quality bidded inventory available to trading desks like ours at Performics, so as long as they don't lose anything we're happy."

What about the technology infrastructure of Right Media? Dalakos says it mainly serves Yahoo and its publishers, and the agency trading desks aren't reliant on it. "It's not critical for advertisers as long as we can still get to the inventory effectively and at a good price."

Sean Kegelman, SVP, partnerships and ventures at Vivaki, said almost the same thing: "It's about the inventory. We're not using the tools of Right Media Exchange to access the inventory. We'll be able to access inventory no matter what."

Kegelman added, "Right Media is a great piece of technology, but it's old. The normal feeling is that anything over three or four years old is generally due for a massive…overhaul."

David Smith, CEO of Mediasmith, said Yahoo's audience remains valuable to advertisers, but he added the offloading of too many products would naturally reduce opportunities for agencies like his. "We care about performance, whether branding or DR campaigns, not the internal strife. That said, the jettisoning of important channels will give us fewer opportunities within Yahoo for media investment and that in the end will affect their market valuation even further."

ClickZ also asked by-the-by for reactions to Yahoo's patent lawsuit against Facebook. Marcus Pratt, Mediasmith's director of insights and tech, said, "The suit against Facebook will not mean much for most consumers or advertisers, and may blow over quickly, but has created a spark of hatred in the vocal software development and 'open web' communities. The lawsuit will probably have minimal impact on ad sales, but the negative PR could create a challenge in attracting dollars from companies that want to sell to this community, or clients themselves who disapprove of this kind of 'patent-trolling.'"

And Performics' Dalakos was sympathetic to Yahoo's patent plight. "Yahoo has noted that a lot of the customization features within Facebook are enabled through features/patents that they own. They don't want Facebook to stop using them but they would like to mutually benefit from them. So the irony in all of this is that this lawsuit might actually get the two companies to work more closely together moving forward," he said.

 

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ABOUT THE AUTHOR

Zachary Rodgers

Until March 2012, Zach Rodgers was managing editor of ClickZ's award-winning coverage of news and trends in digital marketing. He reported on the rise of web companies, data markets, ad technologies, and government Internet policy, among other subjects. 

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