The ad industry's effort to enlist broadcast networks in its drive to standardize electronic buying is off to a slow start.
The sellers are concerned that the security of their data would be at risk in any standardized online buying process. And none has responded yet to a Nov. 5 request by the American Association of Advertising Agencies for each to loan the trade group $10,000 to fund an "XML Repository."
The networks are also put off by the way they were solicited for the loan—by letter. "The 4A's should have brought us all in to explain and discuss it," said one network executive.
The project, initially funded by Interpublic Group, Omnicom Group and WPP Group with a $45 million investment, was handed to the 4A's in August when funding ran out and Mediaport, the entity created to fulfill the project, disbanded.
"We would all like to get to a point of eliminating the exchange of information and data by phone, faxes and messengers, but that system has worked," said another network official. "Our concern is about electronic-data theft, were we to put sensitive information or exchange it within the system."
"There is no guarantee that confidential information in an industrywide database might not end up in the wrong hands," noted the first executive.
Mike Donahue, evp of member services at the 4A's, who is spearheading the project, acknowledged that the process should have been handled better, and promised to contact the networks to explain the project and how it would benefit them more fully. He said the letter indicated the loans from the networks will be paid back with money the project eventually gets from revenue generated by an online directory of vendors, who will each pay $1,000 annually to be listed.
Jon Mandel, co-managing director of Grey Global Group media agency MediaCom, said he believes the networks are overreacting and should kick in bucks. "It's pretty much like putting gas in the gas tank," he said. "They're stupid if they don't do it."