As the dust settles on the Publicis / Razorfish deal one overriding question remains concerning the "strategic alliance" between Publicis and Microsoft.

As part of the deal, Publicis is committed to spend hundreds of millions on Microsoft search and display ad inventory, over a five year term, at favorable rates. It is unlikely that details concerning favored nation rates will be made public.

As an advertiser I might question the inclusion of Microsoft's media on a buy as a potential conflict of interest, stemming from the commitment Publicis made to Microsoft. According to David Kenny, managing partner at Publicis, the "deal presents no conflict". It is not, however, Kenny's call to make. That's for the advertiser to decide.

The alliance seems to miss the growing participation of advertisers in ad exchanges, developed to provide a bidding platform that can take advantage of hyper-targeting, leveraging a huge data pool for optimal returns. How does stepping out of that framework work to the advantage of Publicis' clients? Was this an oversight?

If search and display rates for Microsoft are below par, will Publicis be allowed to dump the inventory into the exchanges as a broker? Will Microsoft allow it and risk setting rate precedents?

This was a good deal for Microsoft. It remains to be seen if Publicis will fare nearly as well.


Anonymous said...

Well put -and the community will have to see how the real deal unfolds -I think too, publisher partnerships will continue to grow with greater frequency.

richm29 said...

Good catch, Paul.