Martin Sorrell's View of the Key Developments Facing Advertisers and Media Firms

Martin Sorrell, who grew up and lives in the UK, is head of WPP, the largest marketing-communication conglomerate. As such it decides which media firms to support around the world. List list is from "Jack Myers’ Think Tank," a newsletter. Meyers evidently got it from a speech Sorrell recently gave.

1. Global Shifts in economic, political, social and cultural power.
2. Continuing Auto Production Capacity and the under-capacity of people/customers. While U.S. auto capacity has declined, the capacity in China and India has expanded. Over capacity of supply and under capacity in the supply of people makes the role of agencies and marketing even more important.
3. The Web. The reason the Consumer Electronics Show is important is that the tech companies are now media owners. The Web disintermediates legacy players and is a more attractive destination for talent.
4. Internal Communications. Communicating strategic and structural change is an internal challenge for organizations as much as -- or more than -- an external challenge.
5. Retail Power. Major retailers are gaining power, especially when there is little inflation. Retail companies put pressure on manufacturers, pushing companies like P&G into direct consumer marketing through websites.
6. Global Centralization. As companies expand and gain global influence, they are integrating their organizations at the center.
7. Procurement and rise of the finance function puts more emphasis on cost management.
8. Governments, as both regulators and as clients.
9. Corporate social responsibility. Doing good is good business.
10. Content. We have to think about content in the context of how business is fundamentally changing. Consumers have to pay for content. There is not enough advertising to finance the business models of all the new media. There needs to be more consolidation for the health and development of the media business. State subsidies have to play a greater role to maintain professional journalism.

- From Jack Meyers, "Sir Martin Sorrell's Ten Priorities for Media, Agencies and Advertisers," From Jack Meyers Think Tank, February 1, 2010.

The Net Neutrality Furor

PaidContent.org has a useful summary of the furor from the left and the right over the FCC's recent decision on "net neutrality." That is the idea that internet service providers must not show preferences to certain websites by degrading or sling down other websites. Some critics are angry that the FCC passed a ruling of this sort at all. Other critics of the ruling say it didn't go far enough to protect internet competition and the rights of consumers.

See Joe Mullin, "FCC Pushes Through Net Neutrality—And Draws Fire From Right And Left," PaidContent.org, December 21, 2010.

The Struggle Over Kids, Mobile Devices, and Regulation

Kids are usually more facile and fearless with technology than their parents -- quick to click first and ask questions later. A mobile phone that gives them easy access to content and purchasing power makes them easy prey for aggressive marketers.

-Jonathan Liebowitz, Federal Trade Commissioner

Speaking at the start of a two-day FTC forum on mobile devices, Liebowitz said the FTC intends to take enforcement action agtainst deceptive or unfair content offers. "As an example, Mr. Leibowitz pointed to SMS text-messaging offers from marketers that do not clearly disclose the costs for using the service." Activists are pushing for regulations to put companies on notice that mobile devices will not be vehicles for fraud. By contrast, marketing and media executives seem to be worried that, as with other media, specific concern about children might be merely the easiest way to legitimate regulation of advertising on mobile devices. They argue that the FTC should hold off from any rules until it is clear that problems are emerging. "The mobile market is finally becoming a platform for commercial services," they say, and regulations will hinder its development.

In Ira Teinowitz, "FTC on Watch Against Wireless Ripoffs," Advertising Age, May 7, 2008

Advocates Urge FTC to Take Proactive Stance on Mobile Marketing

Privacy advocates are concerned that it could be misused. It's the 'Minority Report' paranoia.

-D. Reed Freeman, a partner with the law firm Kelley Drye & Warren and a former staff attorney in the FTC's Bureau of Consumer Protection

He was referring to a complaint that the Center for Digital Democracy and the U.S. Public Interest Research Group filed with the Federal Trade Commission. The purpose of the complaint is to force the FTC to begin to set rules about how much and how marketers can track people's actions on their cell phones and other mobile devices. Of course, the advocacy groups would disagree that their actions are paranoia. "We're filing a complaint to force the FTC to take a proactive stance," said Jeff Chester, executive direct of the Center for Digital Democracy. He noted that mobile ad companies "incorporate the same problematic business practices that we witnessed with PC-based broadband marketing, including behavioral targeting and profiling techniques--except that this time they know your location."

In Wendy Davis, "Groups Complain To FTC About Mobile Marketing," Online Media Daily, May 6, 2008.

It might be added that, contrary to Freeman's statement, the marketing activities in Minority Report are treated rather gently, even humorously, compared to the government surveillance in the movie. Steven Spielberg, the director, was using the marketing scenes to provide product placement for The Gap and other firms.

Low-Power TV Association Fights Digital Conversion Boxes

I’m in the middle of a hearing, in the United States Congress, and I’m looking at a box that’s going to kill our industry.

-Ron Bruno, President of the Community Broadcaster’s Association

The Community Broadcasters Association has sued the Federal Communications Commission in federal court. The Association is reacting to the sale of digital TV converter boxes that the FCC has approved so that Americans with analog television sets will be able to receive TV signals over the air when stations switch to digital signals, as they will be required to do in 2009. The problem, the Association notes, is that its members, low-power TV broadcasters, will not be switching to digital TV; they are not required to do it and find it too expensive. They argue that the FCC should require the sale of converter boxes that also have switches for analog reception--and that the Commission is violating a law--the All-Channel Receiver Act--by not doing it. Retailers who have already bought the digital-only boxes point out that low-power TV broadcasters reach less than 1% of the TV audience and that great confusion will be created if the Association wins. It isn't hard to understand that the FCC didn't pay attention to the needs of low-power TV, for they are a constituency with rather little power. But it will be interesting to see what happens now.

In Joel Rose, "What Will Digital Do to Low-Power TV?", National Public Radio, May 3, 2008