David Bell, a senior advisor to AOL, believes the adtech bubble is about to burst, taking a lot of small, unsustainable companies with it.
It’s a counterintuitive position given that the ad business is in the middle of a massive, secular movement of dollars from traditional media to digital media. That kind of incoming tide should lift all boats for years to come.
Not so, Bell told Aol’s Thought Leadership Summit on programmatic advertising. There isn’t enough money for everyone, and therefore, “Some companies will just close up,” he told attendees.
Put simply, he basically told a bunch of his peers that they were dreaming if they thought they’d all have jobs forever.
Bell is worth listening to because he was the former CEO of ad agency holding company Interpublic Group, until 2004. After that he was a senior advisor to Google for four and half years before becoming an advisor to AOL.
Here’s what he said, according to AdExchanger:
“The dollars flowing into ad tech have slowed,” Bell said in his keynote address. “Those companies that haven’t gone public and are generating less than $10 million will have trouble getting funding. There will be a wave of consolidation and some companies will just close up. That said, the benefits of simplification are huge. And that’s what’s coming.”
One glance at the LUMA Partners diagram of adtech tells you he may be on to something. There are a lot of companies all doing similar things. Does the adbiz really need them all?
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