Gordon Young, editor of The Drum, offers his insight and opinion on various matters relating to media and marketing.
Gordon Young's leader: All change in the digital land grab
We may be in the depth of a downturn, but in the wake of a few recent acquisitions, including AKQA, I Spy and Fortune Cookie, London now has a few more millionaires.
But the excitement also spread to the global scene with rumours that Publicis Groupe is poised to make a bid for its US rival Interpublic. This was denied by Publicis. However, speaking to The Drum, WPP CEO Martin Sorrell said the protests sounded disingenuous and in his view a deal is very much on the cards.
“What Sorrell says and thinks about Publicis Groupe is always rubbish,” Publicis CEO Maurice Levy said in response.
But no matter where you stand on this particular tiff, there is little doubt consolidation is the order of the day. This has two primary drivers. First of all, most big networks are engaged in a dash for digital, keen to build both expertise and critical mass in this area to ensure they are not left behind.
Secondly, the big networks are also keen to build economies of scale, which has always been the basis for their success.
But will it continue to be? Ironically, the focus of their new found affection, digital, may also be the discipline that disrupts that business model. Network agencies are good at taking care of complicated logistics in a multiple of geographies. So is the internet.
In fact, Results International’s senior partner Andy Collins pointed out in our last issue that the technology and communications sectors are increasingly overlapping. He speculated that it might make sense for an organisation such as Google to buy WPP.
So it looks like the scene is set for even more deals, big and small.
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