Views   18th Sep 2013

Recently, Facilitate Digital and AdSlot announced a merger. Frankly, this is one of the best and most strategic mergers in advertising I have seen in years. Why? Straight Through Processing (STP.) A little used acronym that will become the next big three letter hype machine in ad tech.

The combined platform will be the first of its kind in advertising, allowing buyers to directly query inventory availability from inside the agency workflow, negotiate, book, traffic both publisher and advertiser ad servers, and push transactions to their finance systems, all on a single platfrom. On the surface, this does not seem like a big deal, but it is, it's a really big deal. In my opinion, this was not a deal driven by traditional balance-sheet cost savings, rather it was driven by true value proposition synergies: the integration makes the Facilitate Digital platform more efficient and valuable while doing the same for AdSlot.

There is an old technology adage the goes something like " everything that can get automated will be." In advertising, this means that menial work is getting taken up by the machines and the people are freed up to do more of the strategic and creative aspects of the business. Imagine a world where a media planners logs into her agencies workflow platform, initiates a campaign, defines a portfolio of placement and audiences to buy,  gets approval, assigns creative, bids and is done. That's it. All of the creative is handled through systems (like RTB does today), the delivery is confirmed via communication between the publisher's ad server and the advertiser's ad server, and the confirmation triggers an electronic invoice which is answered by a payment. Effectively, that is how financial trading technology has worked for nearly 25 years.
The beauty is that people only touch the parts of the process where creative thinking and decisions adds value, everywhere else, machines do the work. The implications of such a world are well understood in adland and our colleagues have already undertaken the difficult task of re-imagining their organizations. Data Scientist, Trader, and many other such titles are very new positions within agencies and publishers that have only been created in the last couple of years. These are the heralds of the coming transformation of adland: agencies, advertisers, and publishers.

We have seen this before in reverse, in the RTB space we saw the rise of ad exchanges like Right Media and AppNexus to enable the transaction of real time impressions. Only later did buy-side and sell-side platform emerge and connect to help the ecosystem grow. In the ecosystem of RFP-based media buying, the transactions were always there: first on paper, then Excel, then buy side platfroms like Facilitate Digital's Symphony, and sell-side platforms like AdSlot. What was missing, was the exchange in the middle.

We are particularly excited about this new union because of our partnership with Facilitate Digital and our first-hand knowledge that the management teams of both companies share our vision for the future of transacting media. So, to our colleagues down under we extend a hard-earned and well-deserved congratulations.

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