C (3:47)

Oh, it always was. I mean, Omnicom has always been, it's always been clear that this business acquisition, mergers, I think a polite term for what's been going on, in part because they wanted everybody IPG to feel like they were joining a greater whole. But this is absolutely an acquisition. It's an all stock deal, so there's no cash being exchanged. But that doesn't change the fact that it is an acquisition. Yeah, I mean, those consolidation moves, I think most people expected them to happen where they've happened, that is within the creative business. Those job cuts don't make it particularly welcome reading though, do they? I mean, they follow, I think, 3,000 redundancies at Omnicom in the last year and 3,000 IPG in the last year. So look, I majored in English, not maths, but I mix about 10,000 job losses within not a very large space of time in the grand scheme of things. So, you know, your kind of heart goes out to anybody affected by that, really. Yeah, yeah, you're right. It does leave three major creative brands. What's perhaps notable is that the media businesses aren't nearly as affected by this. As far as we can tell, they're not retiring any of the media agency brands. There's a sort of softer reorganization going on there with client teams being reshuffled and leadership moving around a bit. I'll just bring up the name. But notable is the former head of IPG Media Brands, Eileen Kiernan. She'll be leaving the business entirely alongside some other execs. Meanwhile, other IPG execs have been elevated into the new sort of leadership roster that will be governing the whole of Omnicom itself.

B (5:22)

It's a lot of changes that are happening here and I'd also be interested in kind of get your thoughts about what this means and we'll dig deeper into this later. But I'd also be interested like what this means for like the agency Hold Co because one of the things that I just noted before we started talking really is like it used to be this big four. Now you've just kind of got Omnicom and everybody else because to our point later in the show, WPP is not having a great year and then Dentsu is kind of on the fence. So kind of like, you know, what do you make of the agency Holdco model right now?

C (5:51)

Well, I don't know about a big one. I've been thinking about it as a big three emerging and we used to have. I mean this may be a US European split because on this side of the pond we used to think it was a big six because within the UK and the European markets publicist have asked. Densu are all roughly. I've roughly been in similar sizes especially on the creative side of things I've been thinking about is reducing that to a big three of Omnicom, then publishers, then WPP and then the next step down to that in terms of staff headcounts and revenues is actually very significant. But yeah, it's a significant change to the market and I think this probably is a bit of a. What's the word here? Milestone moment, a threshold moment that we probably are going to say goodbye to. The holding company model as we know it as the premier way to arrange a marketing services business and say hello to something we've been calling an operating company model. Yeah, which admittedly is not a very jazzy title, but basically think less of a portfolio of diverse businesses, some of which potentially compete with each other as they used to back in the Martin style days of wpp. And think instead of a much larger company that's being directed from the center and those arms are specialized tools built for specific situations rather than to compete with each other as a kind of think of a hydra rather than espos is the animal I'm thinking of rather than like a wolf pack. I don't know. And these are all sounding very aggressive but yeah, it feels like like the dawn of a new era within advertising, at least on the agency side of things towards that. And when you look at some of the smaller companies, the Challenger businesses like Stagwell or S4 Capital, they also have borrowed elements of this idea.

A (7:52)

Right.

C (7:52)

Like, they certainly have elements of central organization to different degrees. So perhaps not that surprising that we're seeing it emerge at the top level too.

B (8:04)

I am curious too, like, and I mean this is something that we'll have to see shake out. Right. Because they've only just recently made this announce announcement. Excuse me. And only this week recording this on Monday, December 1st. Only this week have made some movements to where we start to see the ripple effects. But I'd also be curious, kind of what, like how clients take this. Right. Because you've kind of got people that find in or clients that would fall into camps. Either having all services under one roof becomes a, you know, welcome change or it becomes a matter of like, well, too many eggs in one basket and then the focus on my brand, my company, my messaging, yada, yada yada, then loses focus. How do you kind of see this shaking out?

C (8:46)

I'm really boring and say that's the big question. I'm still kissing over coming weeks. I don't really think we'll see much in the way of issues from client conflicts. That seems to be a worry that people don't have as much anymore. It seems to be kind of one of those 20th century concerns. But I do wonder what happens to your clients that are below a certain weight class, if you will. So if you're not one of the mega clients that on the comms leadership are going to be rushing to make sure don't leave, you may begin to feel a bit neglected. It's something we've seen play out at other companies. I'm not saying it definitely will here. It's just something we've seen happen in the past to other places. Oncom's new competitors, which, you know, we'll be chasing the whale. We'll be looking to peel off some of those clients. I'm. I'm certain we've picked up on some suggestions. Now we're coming to the end of the year that 2026 may bring a bit of a rush of media reviews.

B (9:43)

Yeah.

C (9:45)

You know, accounts that become newly up for grabs. Omnicom will sure come to market in force with a new offering with a new positioning and say, look, look at all the firepower we can bring to your account. But all our competitors will be thinking of ways to outflank them on that.

B (10:03)

Yeah, no, I think your Hydra, you know, Hydra versus Wolf Pack was a really good example because like the new Omnicon which let's hope that they leave the name intact. Lord have mercy. I can't handle another acronym here. But they'll have leverage across media, buying data, identity, creativity and more. Right. Which kind of just makes them like this all in one, one stop shop house. And like we mentioned before, to some that's appealing. Others fear getting lost in the shuffle. Now this could be a good opportunity for like a WPP right, to garner some new business, given that they've got open and they've really been making a play here for some smaller companies with their agency in a box tools, which you've also reported on pretty heavily.

C (10:47)

Yeah, absolutely. And if they are past this agency consolidation phase that they've been going through, then they might find themselves suddenly being able to make the argument that their own rivals have made against them, which is that ignore those guys, they're faffing about with their letterheads and the organization charts. It will get you cheaper media. Now WP Media has the chance to make that argument and point to its AI capabilities and its creative shops and all the rest of it and say, look, we're past all that. We could just get on with the work for you. Certainly, I think it'll be a very competitive and busy year on the account review front next year.

B (11:27)

Well, you'll have no shortage of stories. While we go from talking about one company with the letter O as its beginning, we'll talk about the other one, which is OpenAI. That was a terrible transition, but stick with me. So Hollywood Reporter came out with some news that the U.S. a U.S. court recently ruled that OpenAI must turn over certain internal communications about why it deleted two large databases of allegedly pirated books. This is not a ruling per se, but it is a development that further tilts the scale in favor of authors suing the company. And that is a battle that has been brewing for a while now. So US District Judge Ona Wang said that OpenAI must hand over these documents, which reveals the company's motivations for deleting these assets. So effectively, OpenAI, among a handful of other AI companies, have been scouring the Internet looking for data to build up to be able to provide these answers. One of the things that they turn to is obviously books. So by previously disclosing a reason for the deletion, they then open themselves up for the motivation for as to why they did it. So kind of like not cut your nose off despite your face or anything like that, but a mistake kind of opened the question for, oh well, why did you delete that? Let's talk about it further. Right. And so now the ruling or the discussion here is about if this was willful copyright infringement or if it was genuinely and honestly a mistake. So there's more to that's going to come out of that. But I think the broader conversation here is about what companies, AI companies are allowed to use. And now publishers are starting to become more cognizant and have some more leverage in how they're able to, I guess, control the ownership of their intellectual property, of copyrighted materials and things like that. So it's not a ruling, but it is a step in a direction. Right, because you've got OpenAI, anthropic perplexity and the list goes on that also have these lawsuits kind of stacked against them. I know you're on the other side of the pond here, but talk to me a little bit about kind of what you make about this step in that direction. Do you think authors are finally starting to get the upper hand here, or publishers?

C (13:42)

I wouldn't hold my breath just yet, simply because OpenAI are so well resourced in this regard. And courts in the United States and in the UK and Europe haven't really gone overwhelmingly towards protecting authors or artists copyright in the last three years. It's not to say they've been always in the favor of the AI companies, but I think more often than not they have. Where this might be relevant for marketers, in part is that when OpenAI first emerged and ChatGPT first came on the market, in that first year or 18 months, we saw a lot of CMOs, I think sometimes couch their enthusiasm for that kind of stuff and maybe worry a little bit about the legal liabilities they might face if they began using those tools. And then OpenAI was found on the hook for some major copyright or IP theft violation. Most of that's gone away.

A (14:36)

Right.

C (14:36)

Like a lot of agency partners offered indemnification, as did tech partners, Adobe offer it, for example, which kind of basically just means that if that eventually does happen, you, the client won't ever be on the hook for it will cover you. I'm sure they made that promise also with the expectation it wouldn't really come to that, but it helped smooth the path for everybody if OpenAI's, for example, end up on the wrong side of this case down the line. And obviously we don't know if that will happen yet or not, but if they do, I suppose it could affect their attractiveness in an enterprise sense for companies using their LLMs for maybe building chatbots or agentic systems because it might make them more risky in the eyes of a procurement department or a CFO who doesn't want to be stunk. That's the kind of long term thing I suspect most CMOs will be looking at this with in mind. Of course, publishers will be keeping a very close eye on how the author's case pan out because they also have a bound to pick in lots of situations.

B (15:41)

Oh for sure. I know our publisher reporter Sarah Guaglioni has covered this extensively along with Jess Davies about kind of how this space is coming together in terms of like publishers trying to strike deals with these platforms and whether these deals, these publish enough publishers are willing to come to the table and enough platforms, AI platforms are willing to come to the table. Listen Sam, I could keep yapping, but we've got a very juicy discussion coming up about WPP in the year that it has had. I think like you said, Omnicon has overshadowed that, but we won't let it. There's a lot of news coming out of that space as well. So with no further ado, let's get to it.

A (16:19)

Absolutely.

C (16:20)

Thanks for having me. Sam.

A (16:32)

Welcome back to the show.

C (16:34)

Thank you so much for letting me back on.

A (16:38)

We wanted to have you back on to talk about to help us make sense of WPP because wpps it's interesting, Kimiko, as much as we've talked about the agency landscape this year and we've talked about the various agencies, I feel like we've talked about WPP more than any other, which I wouldn't have expected coming into this year considering that 2024 ended with the Omnicom IPG acquisition being announced.

B (17:07)

Yeah, there's been a lot that's been going on, which I'm hoping. This is why we wanted to bring you on, Sam, to kind of recap this because you've been covering this space like non stop, given everything that wpp, the ups and downs that they've got coming up. The interesting way that I saw you put it in the most recent story that you wrote, which was the eulogies for WPP keep getting drafted but the company refuses to play along, which I think kind of summarizes the year that WPP has had. What the hell is going on?

C (17:39)

Well, they've not had a very good commercial year. That won't be news to the folks listening in and maybe it's worth recapping the the 2025 they have had, but there's not while there are some positives and I don't want to ignore them, that's kind of the point I was making in that opening line. You kind of have to take the rough with the smooth, right? And there's much more rough at the moment. I mean, there's just such a long list. Their Q3 results were probably the starkest demonstration of this, where you saw them issue another profit warning. The first quarterly results they've had out since the new CEO came in. Supposed to be a new broom, breath of fresh air, whatever metaphor you want to use, and instead they're at risk of dropping out of the FTSE 100. The market cap is behind that of OnlyFans at the moment, which is a British company. I don't know if you knew. So there you go. We still make things in Brent.

A (18:37)

To your point, we're recording this on Monday, November 24th. Checking the WPP stock this morning. Its stock price is down roughly 61% on the year. So that, like, feels like ominous, the best way to kind of quantify the year that it's been. But to your point, Sam, it's been a lot of there have been some ups. There have been a lot of downs this year, as the stock price indicates. So we'll kind of run through a quick timeline of WPP's 2025. So start off the year with losing its crown as the largest agency holding company by revenue to publicis not how you want to start the year, though technically that was more of a 2024 carryover. But it's not like WPP has regained that crown because shortly thereafter, first half of this year, WPP lost the Coca Cola North America Media account, the Mars Media account. It's lost Paramount as a client and it's lost Bayer business as well. Group M rebranded to WPP Media, which is important to note because WPP Media, Formerly Group M, WPP's media business has been one of the more sore points of its business. When we get to the Q3 revenue, it's been down this year. So Group M rebounds to WPP Media. Mark Reed, CEO of wpp, steps down. They end up announcing Cindy Rose as the new CEO. She starts in September. Obviously that's a huge change. They also announce a new AI marketing platform, WPP open, because everyone has to have some sort of AI platform to some extent. They win some clients. They won the MasterCard, global media business, Electronic Arts, Global Media Business, Pizza Hut, US Creative Creative, among other client wins or retentions that they had. And then I think a week before, they reported third quarter 2025 earnings. So this was late October, they announced WPP Open Pro, which is taking that AI marketing platform that's aimed at clients and basically creating a self serve version of it in an attempt to get small and medium sized advertisers and basically saying oh Google Meta. More recently Amazon, you've built pretty good businesses, pretty robust businesses by having this long tail advertiser base. WPP is having a hard time with like the short tail clients with some of these client losses. So makes logical sense to want to stand up a long tail advertiser client base with something like WPP Open Pro. But then right after that they report Q3 earnings. Seb, as you mentioned, this was not a good earnings report. In fact, WPP CEO Cindy Rose says our recent performance is unacceptable and we are taking action to address this. So gross revenue is down 8.4%. Like for like revenue is down 3.5%. WPP Media's revenue is down 5.7%. There's just a lot of down in this report and there's been a lot of down for this year since that earnings report which was late October. We've also had a lawsuit filed by former WPP Media exec over agency kickbacks which Business Insider reported on. There was a Reuters or Financial Times report. There was a report that Havas is interested in acquiring a stake in wpp. Havas since come out and said no, we're not interested. That's not happening. We're not having those conversations. Maybe everything else we've discussed indicates why they may be less than interested at the same time would make WPP perhaps more of a takeover target. Then in that Q3 earnings call, Cindy Rose did say there's a strategic review underway and that the results of that review, the new strategy, will be unveiled in 2026. Here we are, month to go in 2025, waiting for the strategic review to be unveiled in 2026. Sam Kim that's a lot that's been going on with WPP this year. Sam, you've been all over this story. Is there any one thing, one development with WPP this year that you feel like has been most impactful?

C (23:16)

Yeah, I would actually pick out the reorganization of Group M into WP Media. In truth, it perhaps seems one of the more inside baseball sort of developments in that long list of things. But it came at the end of a series of reorganizations of consolidation schemes within WPP that played out in previous years. The first was the organization of J. Walter Thompson into Y and R. They blended those agencies together. Then YR was eventually blended into VML alongside Wunderman which consolidated a huge portion of its then digital agencies, now sort of general creative agency output into a single house. At the same time they were consolidating agencies into Ogilvy over those years. Gray was initially put together with AKQA and then got shuffled around and is now also part of Ogilvy as a kind of island. So this was WP me's turn to go through that process, which has been a bit of a painful process over the years, but most folks would look at and think it's kind of necessary. WQP had an absolute empire of agency properties going into I suppose the pandemic when this process perhaps accelerated, that this process almost unmanageable. They wouldn't have embarked on this without doing that. These were expensive and valuable agency brands that they decided it was better to sunset than to continue with. And it's not been unsuccessful. VML is a very respectable agency business. Most of WB's agency businesses could be doing better commercially, but I don't think anybody believes they've lost capabilities in that restructuring. So this latest one marks the end of that process for wpp. In theory, there's nothing left to restructure. They've done their tectonics. You would think. You would think. Of course we never know what's coming around the corner, especially after another strategic review. But I would expect it's the end of them. What we're seeing now is in theory the new model BBP being brought to market and probably still clicking into place because it's only been a couple of months. But I would count that as one of the more significant moves, especially since publicists went through a very similar process several years ago prior to overtaking wpp. So I think most observers consider it something an unnecessary if painful task that they've gone through. That's why I would pick it out. Anyway. The optimist's view is that they've been doing the hard, painful stuff this year in the last year and that's part of why you're seeing some drag on those results.

A (26:00)

See, I agree with you that it's one of the more significant developments with WPP this year. I don't know if I would wager on it being the last major consolidation because one thing that stuck out to me in the WPP third quarter earnings call is Cindy Rose talked about coming into the CEO job and since taking over as CEO in early September, she's been on a client listening tour, including talking with clients that are no longer clients of WPP, that have stopped moved to other agencies she didn't name any in particular, but I would assume she's had conversations with Mars and Coca Cola about what happened here. And the thing that she said she's heard from both existing clients in terms of pain points and lost clients in terms of pain points is WPP is too complicated, it's too sweeping of a business and they want simplification. They also want lower cost and they want better results, which of course they do. Everyone would want that. But consolidation seemed to come through as one of the more resonant pieces of feedback that she's received. And so that's where I feel like there probably is going to be something more in the off. And Kimiko, do you agree with Sam that the WPP Media restructuring was the biggest development this year? Do you see something else as like on at least a similar footing?

B (27:33)

I think their AI platform was probably going to be on the similar footing there. And I know it's probably, it's the most recent development here, you know, and it's more says more about their where they're headed than it does about kind of what they've experienced. But it also acknowledges that they know that they're on a downward trend right now. And if AI is kind of the industry's supposed savior, it looks like they're trying to get in there early. Now I don't know if consolidation comes with that. Right. They're aiming for like small business and things like that or how that trickles down to some of their other, some of their agencies, what that means for them. But I would say that's probably their second biggest, if not on par with the the consolidation is the bet that they took there by opening not just their own AI platform but also the self service model that they've got, the open and then the AI Pro thing.

A (28:29)

And it's interesting because I don't think either of you are wrong. I think we could look back at WPP's 2025 and at least when it comes to what WPP is doing proactively, as opposed to some of the client losses that it's had to endure, more secular things like tariff impacts on the ad market. Overall, I feel like the WPP Media restructuring or the introduction of WPP Open and WPP Open Pro can be the two big legacies of 2025 for the company three years from now. But what's interesting, this is a major company that also got a new CEO this year. So I kind of want to make the case for that. And I feel like it ties into what you both said. But Cindy Rose is someone who was on the WPP board but also has experience in enterprise sales. And it feels like between the WPP Media restructuring and especially the introduction of WPP Open and WP Open Pro, this is an agency holding company moving into more of a tech services business, it seems. WPP Media CEO Brian Lesser has talked a lot about Federated Identity and he's coming from Infosum, which he kind of in turn brought with him into wpp. So they've really been building up more of the data side of the business and the technical side of the operations as well. And so I feel like potentially Cindy Rose would be an executive you would want if you're moving into more of an enterprise tech sales kind of operation going forward. But Sam, is that completely off? Am I wrong that CEOs are important? But a business of this size, a market of this magnitude, the CEO, we're past the days of a Sir Martin Sorrel having such an outsized impact.

C (30:28)

I mean, what's the phrase from the Godfather? Wartime consiglieri? I don't know Cindy Rose well enough because we haven't seen so much from her publicly to know whether that's going to be the way she approaches this. I mean, I think she's been very upfront in the way she's talked about the performance of the company. It's rare that a CEO would say unacceptable, especially a new one still hoping to enjoy a bit of a new manager bounce. So I think it's too early to tell whether or not she'll play that significant role or not. I do think your point is valid about the broader direction of the company. So perhaps worth noting is that the European Commission today, as we're recording, they okayed the Omnicom IPG acquisition, which really took away the last roadblock for that merger to go ahead. So that really, I think this year will really be a milestone year in this transition away from the old holding company model into the operating company model is something that our writers are digital we've explored throughout this year. And I think that's true of Publicis and Omnicom and bpp. So, yeah, Cindy Rose coming in with that kind of heritage, with that kind of experience, making them pioneering and figureheading the moves that she has so far, I think matches that theory. Absolutely. I suspect that the work that they've had to do behind the scenes at W Media, at VML is also necessary to lay that up. I mean, that's something that Arthur Seduna talked about. Publicist. The fact that they're benefiting from some of the hard yards they did before the COVID pandemic and slightly into that. Yeah, I suppose. But the issue is every single time I think about this sort of optimist's thesis about where WP is going, the quarterly numbers tend to go the other direction.

B (32:24)

And that's. This is usually where we have Seb bring in his optimistic pov. He's not here to bring that this time. And the numbers seem to be disproving.

C (32:37)

Well, the optimists would be in, in some of the, some of the accounts they've won very recently. Like you can write the Johnson and Johnson and Reckitt and just last week, Henkel in the European Union. Those are, those are big, very large accounts. Which suggests that like, let's, let's not be overly pessimistic here. Clearly they've got something that clients want and they can deliver it at a price. And, and that's, you know, it's not all one direction they've had.

B (33:03)

Well, I mean, we've talked about the steps that they've taken to kind of pull them to turn the ship around, right? The new CEO, they've got the consolidation, yada, yada, yada. Curious. Which of these things do you guys, Tim and Sam, think will pay off will be the biggest roi, to use an industry acronym for you?

A (33:23)

I would say wpp open for the shitty reason of it's probably going to lead to layoffs, which is going to lower costs and that's going to help roi.

B (33:35)

Sam, your face says hot take happening. What's.

C (33:38)

No, it's hard to disagree with that is the hot take, to be honest. I mean, I think Open Pro is a really, really interesting development and it's not something we've really seen other agency groups take a look at. But I think it's too early to make a call. We haven't really seen how they're going to bring it to market. Cindy Rose said during the last earnings call that they were still deciding on a pricing model, which I'm not really sure how to alarm to be at that. The fact that they brought it out and started talking about it, but before having decided on how they're going to price the thing. It's also worth noting that just because a software is self service doesn't mean it's self service behind the scenes. You need to staff it, you need people to sell the thing, you need some troubleshoot it and maintain all this stuff. Salesforce employs a lot of people, for example, if you want to become the salesforce of advertising, you're still going to need a pretty large staff.

A (34:31)

Salesforce is undergoing a ton of layoffs, so. But at the same time, like to the cost point, these are AI platforms. It costs a lot of money to be using these various large language models. Now they have the preferred deal with Google, which is looking real good right now coming off the introduction of Gemini 3, which seems to based on the tech benchmarks have emerged as the top large language model at the moment. Now for all we know, OpenAI Anthropic meta even could next week announce their large language model and everything changes again. So good on WPP to have to be in on Gemini 3, but we don't know how much the costs are going to be inflated or offset. If there are layoffs but the tech costs go up, does that come out even or in the one way or the other?

C (35:30)

I mean WBE is committed to spend 300 million pounds on AI investment. I don't know about indefinitely, but they haven't put a deadline on when they'll stop, turn the taps off. So they've committed a lot of cash to it. That's one of the reasons why their share price internally would be such a concern because the lower that drops and the farther they go down that FTSE league table, the less liquidity they'll have access to. It's probably one of the reasons that I've been doing so much to try and shore up the confidence of investors with buybacks and dividends and such. And it's perhaps one of the motivations in that Havas stake that didn't happen, which is that would have provided a decent amount of cash which they could have invested probably in AI, all things considered. Or more restructuring because that costs money too.

A (36:19)

Yeah, yeah. Because even £300 million, that's a lot of money to any of the three of us when we're talking about AI costs. I feel like that's, I wonder if that's enough money. Now we have OpenAI out there talking about spending Kamiko, what is it, like 1.9 trillion or something like that over the next 10 years or something? Something. It's like a Shohei Ohtani contract, which is a baseball reference that Sam, you may not be privy to, but like a footballer signing a 10 year deal but having some of that money deferred and you don't even know like are they going to still be playing in 10 years. But one thing that all of the tech companies have talked about is their big takeaway of this ChatGPT era is the worst thing that they can do is under invest. And so I Wonder if with WPP, whether £300 million is enough of an investment or whether because of what you said around the pressures on the businesses, on the business from a financial perspective, whether the biggest thing working against it is that it can't. It's not in a position to be able to invest more as much as a publicis or we'll see with Omnicom IPG how much they're going to be able to invest.

B (37:35)

And then to also riff off of that, not to bring up another through line, but because not only are you competing with other hold cos, but Sam, you and I have written about this, they're also having to compete with tech companies that have the money to spend on these things. Right. So following up on Tim's question, like the likelihood of this, you know, being an underinvestment, when not only are you going up against your regular competitors, but also your Google and. Well, no longer perplexity, but you know, the others.

C (38:05)

Yeah. Google gets to play with God's credit card, doesn't it? I think, in truth, I think it.

A (38:12)

Feels like Sam Altman's really the one playing with God's credit card right now.

C (38:16)

Well, perhaps. I think, in truth, I think that question about AI spending is actually shared between Omnicom and publicists and wpb. I don't think they're alone in that one. We're looking at it more sharply because they're the ones who've had the bad quarter, well, the bad run of quarters. But realistically, none of these groups have the cash to spend on that level now. They're not building data centers. Mostly what they're spending on is enterprise access to the LLMs in. In deals and are hiring people, which they'll have to compete to do, which means providing astronomical salaries, I would imagine, you know, maybe 300 million if spent in the right way. But it's a bit of a caveat, isn't it? Yeah, I think it's a tough one, but I think it's shared between omnicomb and publicists and I think it's perhaps something we'll look at in more depth next year, when the glow has come off the Omnicom IPG acquisition a little bit and they have to grapple with what it actually means to put two companies of that size together and share their resources and maintain client confidence and all that stuff.

A (39:24)

Or if this is where, like Kamiko, we had the episode with senior media buying editor Michael Berge, and Seb Joseph, our executive editor of News, back in August, talking about AI's impact on agency revenue models. And at some point in that conversation we got to talking about because of the costs of the tokens for these large language models, do those start to get baked into their spending deals where like, if they're committing to spend X amount of money with Google across clients in the next year, do they get some sort of discount on tokens for use of Gemini? We don't know the details of this like preferred deal they have with Google when it comes to WPP open, but it feels like that's one area in which any of the agency holding companies would be able to kind of mitigate their AI costs. But we have. I haven't come across like any of them talk yet about to what extent like tokens are playing into deals or not.

B (40:24)

Yeah, I think that's something that, I mean, I hate to a we'll see moment, but I mean there's got to be a we'll see moment to see how they kind of cut these deals up to make sure that there's, with all of the spend that there's profit being made here as well.

A (40:43)

Yeah, because it feels like that's going to be something. To Sam's point, all of these agency holding companies are dealing with a lot of similar major effects on their business and similar changes. AI is one of them. And the idea of clients being able to take more things in house if they want to. And so then what's the role of, of an agency? Like, one of the historical values of an agency is in addition to like, I'm a brand, I don't have exercise in creating a TV ad. So I'm going to have an agency that does it. WPP publicists, Omnicom ipg, they're able to buy inventory in bulk. It's there. They go shopping at Costco, whereas the average advertiser is shopping at a supermarket or, you know, just kind of a bodega, depending on how much they can afford. And so what's the like Costco shopping advantage for these agencies in this like, AI era?

B (41:44)

Yeah, that'll be interesting to see how that shakes out and what that looks like. And as they kind of carve up and divvy those things out right now. Sam, is there anything that kind of indicates what that could look like?

C (41:57)

I don't think we know. I don't think we have the details to know. In truth, sorry, I don't have a very good answer on this one because there's just so little that we know coming out of those points.

B (42:09)

No, that's fair.

A (42:10)

Yeah. Because it seems like it all hinges on this strategic review that's underway and whatever is going to come out of that early next year.

C (42:18)

Yeah, I mean, that would be an interesting moment and perhaps it's something to strategic review the question over whether they'll remain in that FTSE 100 league table, whether or not they have a good quarter. I think all of those points ensure that. You mentioned before that we've talked about WBB more than any other holding company or operating company, if you want to use that term. I think that will continue to be the case. A recovery will be a major story. A further fall will be a major story, unfortunately. And yeah, they're the most interesting story there is. It doesn't help that in the uk, for what it's worth, they've been seen as a bit of a talisman company. So I think that plays into a role there. So that's why you get the Times and the Guardian writing about them. They don't care about publicists, they care about wpp.

B (43:12)

I was going to say, I think it's interesting to see how like, hold calls in general, not just wpp, but like agency hold calls, are going to have to reposition themselves to make themselves an asset, a necessary asset, in the same way that they were in like the Madison Avenue days. Right. To continue taking in money and keeping clients as, more to your point, brands take things in house, more things become automated, cheaper, I won't say better, but faster with AI tools and things like that.

A (43:40)

Yeah, it seems like, I mean, everyone across the entire ad market is going to have to kind of reassert their value in 2026, which is going to make for a really interesting year on this podcast. And I think some of my takeaway from this conversation is, like so many of us, 2025, kind of a year to forget for WPP, but also a pretty significant year depending on how things shake out in 2026 and beyond.

B (44:11)

So no eulogy yet is what I'm taking away from this.

C (44:15)

No, I think the eulogies have been kind of premature, in truth, or at least when we talk about the rise and fall. I don't think that story is done yet. That's how I put it.

B (44:26)

Sam, we can't thank you enough for joining us on the POD and walking us through everything that's happened just this year alone with wpp.

C (44:36)

Happy to join you. I only hope that I don't have to reassert my value in 2026. Really ominous way.

A (44:45)

Your value will be helping us make sense of how WPP and the other agency holding companies are researching theirs in 2026.

B (45:00)

Well, that brings us to the end of this episode of the Digiday Podcast. Thank you to everyone for listening. And please don't forget to share this episode with someone who you think would enjoy it. Like you can even rate us and leave us a comment on Apple Podcasts. We'll be back next week with another episode of the Digiday Podcast. Thank you so much for joining us.