Delhi MCD Election Results 2017

Source: media reports

Is the media glass half full or half empty?

Is the media glass half full or half empty?
Comment E-mail Print Share
First Published: Tue, Apr 08 2008. 10 40 PM IST

Marion Arathoon
Marion Arathoon
Updated: Tue, Apr 08 2008. 10 40 PM IST
Marion Arathoon
We live in curious times, when the conqueror suddenly cedes territory. After actively merging, acquiring and consolidating its position in the media planning and buying space, WPP Group Plc. made history here by giving up 51% stake of its GroupM India Pvt. Ltd company, Mediacom India Pvt. Ltd, to Sam Balsara and his Madison Media group.
In another piquant media happening, Mudra Mumbai turned back the clock and became a full-service agency again, bringing media buyers and planners back into its fold. This is a brave move, since the world now extols the virtues of open architecture agency models based on informal collaboration among disciplines. Mudra Group’s media specialist brand Optimum Media Solutions (OMS) has also made way for a new media umbrella brand called Mudra MAX, which has three separate units—Connext, Radar and Videotec.
Beneath the facades of these two adventurous media stories, I see two grand media consolidations that didn’t happen but could well have.
Case one: If GroupM had succeeded in buying majority of Madison, as was expected instead of the reverse, a media Goliath of threatening proportions would have been born. GroupM already handles more than 40% of ad spends in India. The addition of Madison’s substantial billings would have given this combine amazing power when negotiating ad rates/deals for its clients with media owners. The new Mediacom will naturally have the combined-billings heft and savvy of Mediacom and Madison, but this does not pack the same punch as an entire GroupM with Madison would have. GroupM’s rivals and media owners are undoubtedly relieved at this reversal.
Case two: The Mudra story, however, could impact buying consolidation on two planes. Earlier, ads were bought out of OMS. Media buys will now be done out of Mudra Mumbai—for full-service clients, Radar (for Reliance Anil Dhirubhai Ambani Group), Connext (for the earlier OMS business not in Radar or Mudra Mumbai). That’s a diffusion of buying scale and perhaps negotiation clout, say some media buyers. A Mudra insider, however, says they would look at consolidating at the back-end, so as not to lose leverage, while keeping client details confidential.
More significantly, Mudra MAX’s launch is not the best news for OMD—the Omnicom Group Inc.’s media specialist in India. Everyone’s waiting to see if the media-buying departments of Omnicom’s agencies will unite under OMD. Mudra’s restructuring sends signals to the contrary, a reflection of the fact that Omnicom (via DDB network) has minority stake in Mudra.
Both Madison and Mudra would perhaps counter, and rightly so, that the real challenge in today’s fragmented media landscape is to buy media effectively rather than cheaply. And that having a smaller scale than some rivals need not impact their already substantial buying clout. Still, with media networks rapidly inter-marrying to get efficiencies of scale, I can’t help wondering: what if...
Marion Arathoon is Mint’ s advertising editor. Your comments are welcome at advalue@livemint.com
Comment E-mail Print Share
First Published: Tue, Apr 08 2008. 10 40 PM IST