As Publicis waltzes Bcom3, not many dance partners left

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And then there were four.

The merger of Publicis and Bcom3 to form the world's fourth largest agency holding company shouldn't come as a surprise, not even to those who expected Dentsu, which will align with the merged entity, to simply increase its stake in Bcom3.

Though there were official denials and vigorous twisting to avoid the topic, Bcom3 boss Roger Haupt had been spotted in Paris in recent months, raising speculation about the pairing. The fit was good, if only because of the Procter & Gamble connection. There were even rumblings that Grey, also a P&G agency, would join the group in a re-creation of the Big Bang that formed Omnicom.

Don't be surprised if this, the Grey thing, still happens. The consolidation of the ad agency business is just about complete, with Grey, Havas and the struggling Cordiant as the only significant players left without dance partners. They'll need to find them, soon, or risk oblivion. Of course, Grey's Ed Meyer, who essentially has absolute control over his company's fate, has been confounding would-be acquirers for years with his stubborn refusal to sell (or, as is said off the record, his unreasonable demands on price and post-merger role). Don't expect the tough-as-nails Meyer to be any easier to deal with now, but he may be more willing to answer the phone.

Cordiant doesn't look too desirable to the players that are left. Havas' Alain de Pouzilhac, trumped by fellow Frenchman and archrival Maurice Levy of Publicis, is surely formulating a response.

The options of all the remaining players are rather limited. It would be nice to think smaller companies and independents can still thrive in a consolidated market, but there is now very clearly a top tier and then there's everyone else. Based on the charts published by Publicis on the morning the merger was announced, Omnicom Group, Interpublic Group of Cos. and WPP Group are the Big Three, and a merged Publicis-Bcom3 is fourth, with about $4 billion in revenue. Havas is shown about half the size of Publicis-Bcom3, and Grey and Cordiant are smaller than that. Cordiant has revenue of less than $1 billion, while Omnicom approaches $7 billion.

This is the world we always knew we'd live in, but it's breathtaking to find ourselves there. In the highly unlikely event Cordiant, Grey and Havas pull off a three-way merger, that company would round out the top tier. But there wouldn't be room for anyone else.

We have come this far in a short time. By the late `90s, Omnicom, Interpublic and WPP were already the Big Three, but there were contenders. In 1997, Michael Greenlees of GGT Group predicted there would be five agency holding companies left in a few years. GGT, which had acquired BDDP Group, aspired to be one of them. In February 1998, Omnicom swallowed GGT whole.

Ad Age wrote at the time that the remaining holding companies all shared the dream of reaching the top tier. "Most," we wrote, "will fall short." The dreamers included Young & Rubicam (since acquired by WPP), True North Communications (now part of Interpublic); MacManus Group (now a member of the Bcom3-Publicis family); and Publicis. Question answered.

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