ESPN is dropping its ad networks, MediaWeek reported today. MediaWeek suggests the sports publishing giant has decided to sever ties with ad networks because, like many publishers, the company sees ad networks as diluting the value of its content. From the article:
“We’re heading down a path where it no longer suits our business needs to work with ad networks,” said Eric Johnson, executive vp, multimedia sales, ESPN Customer Marketing and Sales. Sources say that ESPN would like to rally support from other publishers behind this move and ultimately tamp down ad networks’ growth. Turner’s digital ad sales wing is rumored to be considering a similar move, though officials said no decisions are imminent.
The central issue is whether or not ad networks devalue a site’s content, or if they’re salvation for ad inventory that would be wasted without them. Because they bundle the traffic of smaller sites in a large network, ad networks have recently been pitted as directly opposed to the traditional ad sales model in publishing, which is based on direct relationships with advertisers and driven by premium, branded content. Some online publishers say the benefit outweighs the risk, and it depends on the content (again, from MediaWeek):
“Not all inventory is created equal,” said Peter Naylor, senior vp, digital media sales, NBC Universal. For example, Naylor said iVillage’s Horoscope section generates a lot of traffic but doesn’t attract many endemic advertisers. That’s why he turns to networks. According to Pam Horan, president of the Online Publishers Association, most publishers do just that.
I like Mathew Ingram’s nuanced explanation of the ad network vs. no ad network debate, which is, in a nutshell, that sometimes they’re a good thing, and sometimes they’re not. Or rather, that they’re a good thing until they’re not.