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SMG ditches billing, tracking service that has industry near-monopoly
FOR 40 YEARS, Donovan Data Systems has held a near monopoly on the business of media billing and tracking. But now, in the first defection of a major player, Publicis' Starcom Media Vest Group has moved its spending power to MediaBank, a Chicago-based software company that acquired Donovan competitor DataTech last year.
SMG has made no secret of its frustrations with DDS, which, by its own estimate, handles media billing and tracking for 10 of the top 12 media agencies in the U.S. market. The impetus for the switch was to find a tool that could simplify the task of buying and billing in an increasingly diverse and thorny media landscape (which now includes interactive platforms that didn't exist when DDS was engineered). The breakup between the two companies was bitter, ending where so many long-term relationships gone bad doin court.
Founded in 1967 by Michael Donovan, Donovan Data Systems manages more than $60 billion in media investments in the U.S. market alone. It counts heavyweights such as MindShare, OMD and Universal McCann as clients. There is really no direct competitor to DDS-save for maybe DataTech. Some smaller media buying shops use systems such as MediaPlex or Encoda Systems, but no other company comes close to handling the amount of billings DDS does.
But despite its grip on the industry, losing a network the size of SMG, which handles about $17 billion...