The CAB had initially rallied its members to become involved: In October the group sent a letter to numerous ad-sales presidents recommending they "consider their possible inclusion into this test."
But despite their early interest, it's apparent TV sellers were upset they haven't had more of a say in the system's design. Sean Cunningham, CEO of the CAB, said a small group of senior cable sales executives from some of the larger cable networks got a first look at the electronic exchange system Jan. 25. The peek raised more questions than answers and the networks were under the impression they would get another look at the system soon and begin testing it.
They were then taken by surprise when eBay presented the system at the 4A's Media Conference in late February. It was off-putting for many of the members that attended because the system include several unexpected aspects, Mr. Cunningham said. "We had been fully collaborative testing partners with them at this point, so it was news to them that this product was ready and that bugs had been worked out," he said.
According to the CAB, there were multiple impediments to the system working. First, said Mr. Cunningham, eBay designing the system was characterized as "outsiders trying to make an insider's product." He also said the system had "minimal ability to capture the vast majority of the reasons, rationale, insights and nuances of how all buys are made."
One cable-network executive involved with the CAB demo said the system was "premature" for this year's marketplace and would need to have enough participants to function as an auction. "You'd have to have enough critical mass of advertisers and also competitive networks," the executive said.
And while the system had been designed with guidance from several agency executives, not all were on board.
"There's no question we want something -- anything -- if it's going to improve the efficiency of the process we're using. I don't think what I've been exposed to is the answer," Starcom CEO John Muszynski said at the Association of National Advertisers TV Forum in New York last month.
The steering committee of the E-Media Exchange, which includes marketers such as Microsoft, Home Depot, Lexus and Intel, issued a statement expressing disappointment with the cable industry's decision: "We selected national cable for the pilot because they have a history of embracing new industry initiatives. We are surprised at the CAB's unwillingness to continue the dialog on this topic.
"It is evident," the statement went on, "that this is a very active marketplace and the idea of media exchanges is gaining momentum. We are still bullish about the system that has been produced. ... We will continue to pursue cable networks and are confident that the eMedia exchange will have traction with cable and other media."
EBay said the system will go forward despite the CAB decision. "We were quite surprised and disappointed with the CAB decision," said Brad Williams, VP-communications for eBay. "The media marketplace will go forward."
He said the steering committee and eBay had intended to initiate a test of its technology for selling advertising online at a few cable networks, but in the early test no dollars would have been exchanged.
He said that while that test will now be delayed, both eBay and the steering committee continue to see strong interest in the electronic system.
"We view this as a speed bump. The steering committee is bigger than cable TV," he said.
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Contributing: Andrew Hampp and Ira Teinowitz