New terms announced for Web advertising

US advertisers and publishers have finally come to a compromise on advertising terms, introdusing sweeping guidelines on terms and conditions, ordering and cancellation, privacy and ad positioning.

No single solution will lift online advertising from its slump, but a group of prominent Web media companies and advertising agencies hope they have moved a step closer

Today, the American Association of Advertising Agencies and the Internet Advertising Bureau are releasing voluntary terms and conditions for ordering and placing advertising online. The groups hope the new terms will simplify the process of buying ads on the Internet and add legitimacy to the medium.

"I think one of the biggest problems was every time there was a deal done, both sides had to start with brand new terms and conditions," said Robin Webster, the IAB's CEO. "When you have a hurdle like that, that's not good for the industry."

Will bigger ads save online advertising? YES

Advertisers and publishers have tried to compromise on terms for years, but the process accelerated once Webster joined the IAB in January as the group's first CEO, according to Mike Donahue, executive vice president of member services at the AAAA. Terms were hammered out during an AAAA conference in February.

Both Donahue and Webster expect many industry players to use the terms in future negotiations, but said the process of replacing proprietary old terms could take some time.

Yahoo! is among first sites to sign on. CNet Networks said that it agrees to the terms "for the most part." America Online was involved in the negotiations, according to David Smith, president of Mediasmith, but AOL could not be reached for comment. Other members of the IAB include Dow Jones & Co., Microsoft and New York Times Digital. The terms only cover ads served by media companies, not third-party ad servers. The groups will meet in the next couple of weeks to discuss terms for third parties, Donahue said. The document also does not apply to sponsorships or other special arrangements such as integrating advertising in content.

The terms cover a range of issues, including cancellation policies, privacy and ad positioning. One of the key issues addressed involves sequential liability, in which agencies cannot be held liable for any media bills unless they have been compensated by their clients for the media buy.

While agencies have supported the policy, many Web publishers have opposed the idea. The IAB said that given the circumstances outlined in the document, it is now recommending sequential liability to its members.

For CNet, sequential liability is one issue that will likely require an addendum to the terms, said Greg Mason, executive vice president of sales administration at CNet.

Both the AAAA and the IAB admitted that figuring out standard terms was just the first step in a long process. One other hurdle: figuring out how to measure an ad's performance online.

"We know there's a huge difference right now in measurement, but we don't know what's right and what's wrong," Webster said. The IAB has commissioned a report from PricewaterhouseCoopers that will study measurement techniques.

The new terms can be found on and