DoubleClick-Real Media Talks Hit The Skids Following L90 Deal

Tensions stemming from DoubleClick’s surprise purchase of L90’s adMonitor earlier this week and, some say, a clash of egos, have caused PubliGroupe’s discussions to sell Real Media to the industry leader to flounder. Meanwhile, several leading Web publishers are up in arms over the prospect of DoubleClick’s near-monopoly over ad serving.

According to sources close to the discussions, Real Media’s management — who also hold positions in Lausanne, Switzerland-based PubliGroupe, a major European print rep firm — have upped their asking price for the company’s OpenAdStream serving technology.

That move comes following DoubleClick’s purchase of Los Angeles-based L90’s adMonitor serving technology on Tuesday. New York-based DoubleClick has said that it plans to port the smaller firm’s clients over to its own DART server.

Now, sources say Real Media’s management and parent company are trying to put the screws on DoubleClick.

“The Swiss are taking the position that because of the L90 purchase, OAS is really the only big rival to DART remaining,” said one source.

Additionally, Alley-based Real Media is said to be using the fact that OpenAdStream is an in-house software solution, rather than an ASP product, as a bargaining chip. Both DART and adMonitor are hosted services, and while DoubleClick does offer an in-house product, AdServer, a source says that it’s in the industry giant’s best interests to acquire OAS.

“Everyone, everyone knows that it’s DART that is DoubleClick’s favored child, not AdServer,” said the source. “DoubleClick just pushes DART harder … and now it has to face the fact that AdServer is considered less of a product than [OAS], in many people’s minds.”

But according to still another source, Real Media’s position as one of the few remaining big ad servers — a list that also includes troubled CMGI-owned Engage, 24/7 Media, and serving newcomer Bluestreak — is encouraging PubliGroupe to considering pulling out of the deal entirely.

A statement on Friday by the firm — pitching steep discounts to L90 clients — sheds light on the company’s perspective, maintaining that “the acquisition by DoubleClick of L90 leaves just Real Media as a major, global competitor to the largest third party ad server.”

If PubliGroupe is considering ending the DoubleClick talks, the change would mark a significant reversal of the Swiss firm’s efforts to distance itself from its New York-based online subsidiary. In December, PubliGroupe ousted Real Media’s chief executive, Chris Neimeth, and replaced him with its senior vice president for international sales, Walter Annasohn. Six months later, PubliGroupe oversaw the signing of a strategic partnership between Real Media and a traditional rep firm that it also owns, Dallas-based Publicitas. Spokespeople at the time denied that the move was a step toward consolidation.

But following wider-than-expected losses (due in part to its online business) and a subsequent management shakeup in its interactive division (which oversees Real Media and several smaller firms), PubliGroupe forced Real Media to hand over its site representation business entirely to Publicitas. Following that move, Real Media said it would concentrate entirely on sales of ad technology.

Nevertheless, talk of abandoning the discussions with DoubleClick still seems premature, as PubliGroupe has made several public statements to shareholders in recent months signaling its intention to exit a large portion, if not all, of its online businesses.

Such a possibility has many publishers upset.

“If [Real Media does] get purchased by DoubleClick, what would concern me is whether we would lose the option to be able to work with Real Media’s platform and software, as we have been,” said the chief executive of a major, ad-supported Web site using OpenAdStream. “We’re very happy with [OAS], we’ve got it customized to our environment and optimized for who we are … and, whenever a company gets purchased, you don’t know how the priorities, objectives or orientation — or even the individual people that make a difference — will be changed.”

“There are many that wouldn’t be happy with that,” the executive added. “Depending upon what DoubleClick has chosen to do, they could potentially eliminate an option that a number of us feel very good about. And if they keep Real Media alive and working, it remains to be seen what will change as a result.”

There are other considerations as well, say publishers.

“Whenever you have one company with an effective monopoly in a market, there’s always price consideration,” one said. “Competition always helps keep prices lower than they would be otherwise.”

Additionally, several publishers said they were considering developing their own ad server.

“It’s not so much a matter of a philosophical difference, of Real Media over DART,” said an executive at another Web publisher. “It’s just that we are used … to a certain level of customer service. Real Media is a lot smaller than DoubleClick, and they gave us the kind of attention that we have really become reliant on. With that being said, I know there are a bunch of us talking now about going it on our own.”

Added another executive, “We’ve really had no reason to [develop an independent ad server], until now. We’ve been so very satisfied with our relationship with Real Media, so … that doesn’t cause you to think of that. But it wouldn’t surprise me if it does occur. Companies want options available to them.”

While all these discussions and debates are going on, DoubleClick’s rivals are seeking to capitalize on the news by offering discounts to estranged — and potentially estranged — clients.

Andover, Mass.-based Engage, for one, is offering former L90 and Real Media clients “substantial discounts” on its AdManager serving software or its AdBureau ASP service.

“L90 and Real Media customers who accept this offer can be assured their technology needs will be met,” said Chris Cuddy, Engage’s interim president and CEO. “Not only is our software flexible and scalable, it also integrates easily with our other content management applications, allowing customers to better coordinate their online and offline marketing efforts. By integrating the two, customers can cut costs, operate more efficiently, and create new revenue potential.”

Engage isn’t the only one. Newport, R.I.-based Bluestreak also is offering undisclosed incentives to publishers to “ease the pain,” said the firm’s marketing communications director, Stefan Tornquist.

“Bluestreak has been recognized for its superior customer service, and we are dedicated to smoothly transitioning customers from their previous ad platforms to ensure consistent delivery and management of their online marketing,” he said. “We also guarantee personal one-on one-customer account management.”

Real Media, meanwhile, also said that it is offering 25 percent discounts to former L90 clients, to encourage them to switch over to either OAS or its OpenAdStreamCENTRAL ASP solution.

“This news opens up great opportunities for us and for former L90 customers,” said Real Media’s Silvana Imperiali, an executive vice president and the firm’s chief operating officer for the Americas. “Suddenly, we’re one of only two major players in a market where Web publishers are looking for new ways to control and monetize their audience data.”