The questions left open by the Omnicom-Ipg consent of the FTC


Super-merger of $ 13.5 billion from Omnicom and Intepublic Group (IPG) made a giant jump to the completion this week, following a qualified approval granted by the Federal Trade Commission (FTC).

The conditions attached to the green light of the FTC are however far from normal. They force the combined capacity of Holding to keep customers away from publishers or media environments that could compromise their reputation. The agreement grants the United States government an unprecedented power over the flow of advertising dollars to publishers, according to industry observers.

“It gives the [Trump] Administration… and future administrations, for a period of 10 years, a vehicle by which they can decide on an industrial scale, [that] The largest American media agency will finance or will not finance media owners on behalf of their customers, “said Ebiquity CEO Ruben Schreurs.

Taken alongside the FTC legal fighting legal with the Lobbies Media Matters group and the recent examination of the Congress of the Digital Advertising Sector, Forrester analyst Jay Pattisall, told Digiday that this decision “represents an unprecedented politicization of freedom of expression and commercial creativity”.

The two companies have agreed to the conditions of an “consent order”, a legal mechanism generally deployed to force companies to depart from commercial units in order to avoid creating a monopoly.

But this order, which remains active for the next decade, prevents Omnicom from making advertising dollars far from media owners who publish “ideological” content, unless the brand’s customers are specifically requested. The company is forced to provide the FTC an annual report detailing its compliance with the order for the next five years. The intention is to stop an Omnicom Post-Fusion using its enlarged position on the market for political purposes.

While the managers of Holding welcomed the decision, the neutrality imposed by the FTC could end up costing the combined entity and weighing on its customers.

In a press release, the boss of Omnicom, John Wren, said that it was “an important step towards the end of the proposed acquisition and the creation of a new era”. It is also an unusual step for the FTC, which evokes a series of knotty problems for the American advertising industry.

Take each in turn.

What is “ideological content” and how is Omnicom / IPG forbidden to avoid it?

The Order of the FTC prevents OMNICOM from directing advertising dollars of customers based on “political or ideological points of view” hosted by a given publisher, and it will not be able to use exclusion lists – its own or those provided by companies like Double VERIFY or the science of integral advertisements – unless an advertiser requests it.

Pattisall said that the warning means that order will not affect most of the media investment decisions because they take place in reality. “Almost all plans and purchases of the media are decided by advertisers. Customers are the ultimate decision authorities to buy media, not agencies, who act as advisers. The consent order ignores the functioning of advertising,” he said in an email.

The order should not affect the “inclusion lists”-databases containing publishers who have been buffered for pre-approval by the customer’s team, and which are considered to be the approach of the brand’s security stallion among most media buyers.

“Brands are the ultimate decision -makers, as they should be, where their dollars are spent,” said Jeremy Goldman, Emarketer analyst.

A problem? The order of the FTC does not offer a definition of ideological or political publishing. This imprecision serves an objective, given the declared antipathy of the FTC towards advertisers or agencies exercising power over publishers and social media platforms – and how it could change from administration to administration.

“The FTC is not happy that anyone has a certain degree of capacity to unionize media purchases. He does not want to see more consolidation,” said Goldman.

Potentially. The FTC’s request to document each choice to exclude an publisher from a media plan may not be a major headache for an organization of this size, but it is a papercard that they could do without.

“There is no doubt that there will be a level of legal control which must make these reports, which is expensive,” said Gartner analyst Andrew Frank.

Most importantly, prudent customers who wish to avoid disseminating advertisements against political media without catching the heat of the federals can now turn to Omnicom rivals – Think of the WPP, Publicis, Stagwell, Havas or Dentsu – media for a way to do so. Order “undermines them [Omnicom’s] competitive position, “said Schreors.

Pattisall noted: “Given that all other world media agencies are under international property, the FTC may have involuntarily handed over agencies based in London, Paris and Tokyo a short-term victory.”

That said, the greatest agency criticism rarely boils down to a single factor. “If you talk about a large account of several billion dollars that changes your hands, then you judge it with 80 different parameters,” said Goldman, adding that he had “struggling to imagine a situation where it is a break”.

The consent order only links Imnicom, but that does not mean that its holding holdings are beyond the views of the FTC – the agreement is also a signal so that they enter online.

“It’s almost like [pulling] On a person on the highway because everyone will see him, “said Goldman.” It is a very public show. “”

Could this change how agencies approach the security of the brand?

This means that Omnicom will not be able to use a bridge approach. Now he will have to show that when his customers choose to exclude an editor, they do it for their own unique reasons. The making of these decisions in a way that satisfies the FTC will generate the mountains of paperwork (it is not yet clear how the FTC plans to fill these reports, or the non-compliance of the response), but this is the way the wind already blows.

“This is already done on a brand brand base, client by customer. But it will now be the standard,” said Pattisall.

This will probably influence other portfolio companies to take a similar line, he noted. “Dentsu, Havas, Publicis and WPP Media … will adopt the same tactics to stay outside the reticle.”

At first glance, there is a positive angle here for news publishers. In recent years, they have been taken by block lists that have poorly extended legitimate reports to important subjects as unsuitable for the advertising of the brand. Although some brands will continue to avoid disseminating their ads on the New York Times or the Guardian websites by an explicit choice, this decision means that agencies cannot cut them from the word Go – right?

Not necessarily. The FTC’s order of consent cuts both senses. Omnicom can neither directly advertising an editor for political reasons – nor towards it. This means that there is a chance that the publishers of news and news will end up losing, if their coverage is deemed to have an ideological inclination.

“It seems at first glance that it is more difficult to monetize news content,” said Frank. How the letter of the order of the FTC is translated by reality – today, in five years and in 10 years – is in the air.

“It depends completely on how regulators want aggressively,” added Frank.



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