@ Ad Week ’07: AOL’s Kayse: eBay Would Be A ‘Provocative Acquisition’

Stressing the viability of portals as an advertising medium, Kathy Kayse, EVP, Sales & Partnership Alliances, AOL (NYSE: TWX) Media Network, said AOL’s site would be strengthened by the addition of a commerce partner. Asked for her “wish list” during a panel discussion as part of Advertising Week ’07, at the Time Life Building in New York, Kayse said that the mix of data a portal and a commerce site would greatly enhance to site’s targeting abilities for advertisers. In particular, Kayse added that “eBay (NSDQ: EBAY) would be a provocative acquisition” for AOL.

“I go back to the ‘if it’s not built here’ mentality that it would an interesting acquisition because of the depth of data that eBay owns and the relationships with consumer and the small business owner,” she said to me in a conversation after the panel was over. I asked Kayse if AOL had made any overtures to eBay and she responded, no. “I mentioned it because it’s important to get people to think a bit differently about what it is we do. What we have is a great relationship with consumers and eBay has a commerce structure in place. The combination would would create a powerful platform.”

More from the session – which also included David Cohen, EVP, director of Digital Communications for Interpublic’s Universal McCann, and Matt Straznitskas, senior partner at WPP’s Mediaedge:cia, discussing Google (NSDQ: GOOG)/DoubleClick and the value of portals – after the jump.

Before opening the panel, AOL’s How to Remain a Leader in the Interactive Advertising Marketplace Today, Fortune magazine senior Stephanie Mehta prefaced her questions by warning the audience that four days into the Ad Week, it would be difficult to uncover any new ground that hadn’t been tread on previously. With focus on Google execs scheduled to appear Thursday before a U.S. Senate committee examining its $3.1 billion proposed merger with DoubleClick, the panelists pretty much agreed that consolidation in general wasn’t a problem. However, after noting their respective delicate relationships with both Microsoft (NSDQ: MSFT) and Google, the three said that there was legitimate cause for concern about the implications the merger would have on interactive advertising.

— Cohen: There are many positives from all the M&A activity that’s been going on in the industry, namely the streamlining of media buys into a digital dashboard that would provide one-stop shopping for all kinds of interactive ad deals. Overall, considering that are roughly “120 million websites out there,” he was not worried about concentration of advertising power in hands of the few. “There’s enough out there to go around.”

As for Google/DoubleClick specifically, Cohen noted: “Microsoft is our largest global client. The worry about [the merger] is less about what is going to happen than what could. The potential is there for very nefarious stuff there. [The federal government’s scrutiny] is well-warranted.”

Straznitskas: “It’s ironic that Microsoft is doing this, considering they just bought Atlas [via parent aQuantive].” He then brought up WPP’s $649 million acquisition of 24/7 Real Media. “The industry is hedging its bets [with these interactive buyouts]. The deal has already paid dividends, especially in the area of search. We used to be agnostic in tech and did not have programmers who can manage search tools on staff, so that was immediate benefit,” to which Cohen responded: “You could buy an awful lot of developers for $650 million.”

Since this panel was sponsored by AOL, the talk soon turned to the viability of portals and how they are likely to evolve.

Kayse: “At the end of the day, AOL is an important filter for content. As someone mentioned before, there are 120 million websites out there. Portals are still needed for that purpose. I don’t believe portals are meeting their demise.

Straznitskas: The portals offer real geo-targeting, they know something about their users. And to advertisers, that’s incredibly important and that kind of data and knowledge portals have will be for a long time.

Cohen: Portals have to evolve and become more than just a jumping off point for something else.

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