Friday, May 2, 2014

The "Merger."

I don't really know what's going on with the Omnicom/Publicis merger. I do know that anything that involves huge amounts of money involves, also, huge amounts of ego. And no good comes from the volatile mix of money and ego.

I also know that the same collusion that's taken place among Silicon Valley tech firms and the concomitant anti-competitive practices and downward pressure on salaries will likely also occur when nearly 3/4 jobs in the industry are controlled by three or four companies.

In short, it will be very easy for a "CFO" making $13 million per annum to declare that holding company "X" will not pay more than $750/day for a freelancer. And that will become a de facto rule.

What I think will happen whether or not this behemoth merger takes place or fails is what observers of financial shenanigans call "A Hit and Run."

Agencies up and down Madison Avenue (which have been forced by the business' ruined economics to reside nowhere near Madison Avenue) will be "hit" by legions of financial people. They will uncover every dime they can from every agency. They will squeeze all cost from agency organizations, taking all value out of them until, in fact, they can no longer even provide value.

Then, likely, they will declare bankruptcy. Bankers and lawyers and CFOs will collect tens of millions in fees and they will then "run." They will leave the industry withered and sere like a miner's black lung.

Hit and run is basically how big finance works.

It's how people who have never made anything make billions.

But there I go again, being optimistic.

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