Supergroup ad exchange still in play but agencies threaten ACCC if prices fixed

By Brendan Coyne | 24 April 2013

The 'gang of four' premium ad exchange between Fairfax, Mi9, News Limited and Yahoo!7 is still in play and is understood to have an agreement with Microsoft-backed AppNexus to provide the platform. However, media agencies are talking about price collusion and the ACCC.

The rival online publishers are working up the deal in a bid to counter the might of Google and the media agency-owned demand side platforms (DSPs). The group has cited examples in France and Canada as case studies for success.

All four firms have remained tight-lipped on the deal, which has raised eyebrows amongst the media buyer community. Agencies are concerned that they will lose revenue and have asked for clarity about what it means for their relationships with individual publishers.

AdNews understands that the firms are still thrashing out the terms of the deal, but that it should launch late next month or in June. It is understood that former Fairfax digital boss Pippa Leary is a candidate to run the new exchange.

The complexities of revenue arrangements and legal issues are likely to be the main stumbling blocks to establishing the exchange, which was originally flagged to launch around now.

That's because media agencies will likely raise the issue of co-ordinated price fixing with the ACCC should the publishers appear to be fixing rates across their four businesses.

"There is a very fine line between individual companies setting individual cost bases and the four biggest publishers getting together and talking about pricing and [not breaching] anti-competition laws," said one media agency executive, who wished to remain nameless.

"It is not about media agencies being concerned about impact on their revenues but about the wider market, including clients, keeping a very sharp eye on whether this is a thinly disguised plan to extract better returns by ganging up and agreeing prices."

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