Telescope http://zonewire.net/telescope/page en stewart@stewartschley.com Copyright 2013 2013-02-21T22:44:19+00:00 Hey upfronts: ready for a dynamic dose of VOD? http://zonewire.net/telescope/page/hey-upfronts-ready-for-a-dose-of-vod#When:22:44:19Z It’s been a long time in the making, but cable-delivered “dynamic” video-on-demand advertising is now poised to make an appearance on the national media stage during the 2013 upfront season that kicks off in May.

 

Several national cable networks have been working behind-the-scenes with cable’s Canoe Ventures consortium to fine-tune their VOD advertising approaches in time for the 2013 upfronts, according to Chris Pizzurro, who heads sales and marketing efforts for Canoe Ventures.

 

“It’s extremely satisfying to finally see it happen,” says Pizzurro, who worked on early VOD advertising implementations at Turner Broadcasting System Inc. before joining Canoe in 2011. Canoe has been focusing mainly on DAI since a radical downsizing in 2012 scaled back the work Canoe had been doing on other interactive advertising initiatives.

 

New possibilities

Dynamic ad insertion into VOD programming refers to the ability to inject commercials into discrete VOD sessions requested by cable viewers. It’s a big deal because it opens up new possibilities in cable advertising, including the ability to accurately track how many people see advertisements and the ability to change out commercial copy more easily than past VOD ad implementations allowed. Over time, proponents think DAI will grow to encompass other marketing feats such as targeting viewers or households by specific demographic or behavioral attributes in an Internet-styled advertising approach.

 

Making DAI happen requires interplay between the TV networks that make programs available over VOD, the on-the-ground cable systems that maintain VOD servers and software, and technology providers that match commercials, content and viewing sessions using sophisticated decision-management software. Canoe’s job is to come up with a common insertion platform and set of agreed-upon processes that integrate all three components.

 

Already, DAI insertions into VOD programs are quietly taking shape across numerous networks that have worked with Canoe to integrate the capability into their VOD offerings. Pizzurro says “numerous” cable network groups have either completed DAI integration or are close to finishing the required work. “All of these folks are gearing up to have this available at the upfront.”

 

Although there are several technology providers involved in the mix, Canoe has managed to come up with a common set of approaches and business rules that networks, cable systems and advertising intelligence systems can accommodate. The strategy has been to build around familiar advertising practices, says Pizzurro. That means embracing concepts such as scheduling ad flights by days, weeks or months and building campaigns around known programming genres or series titles. “From a broad view, we wanted to at least equal the capabilities of linear television. That was the guiding principle out of the gate,” he explained.

 

It’s also the reasoning behind Canoe’s pursuit of accreditation from the Media Ratings Council – the non-profit industry group that evaluates television ratings approaches from the likes of Nielsen, Rentrak and others. Pizzurro says the MRC’s blessing is important for instilling confidence in the media buying community over the way DAI ad impressions are tracked and reported by TV networks to their advertising buyers. The notion is to deliver an exacting level of reporting that elevates the DAI medium from a measurement standpoint. “If somebody schedules 1 million impressions in March, they’ll get back a daily report that tracks that progress,” said Pizzurro.

 

At the moment, the footprint for cable DAI in the U.S. is about 28 million homes – the combination of DAI-enabled homes reached by Comcast and Time Warner Cable. Pizzurro points out the field of play includes 20 of the top 25 TV markets, with more likely to come on board as additional cable companies make their VOD machinery available to national programmers later this year.

 

Meanwhile, one cable network has already broken the ice. Fearnet, the ad-supported cable programming service owned by a joint venture of Comcast, Sony Pictures Television and Lionsgate, has been implementing DAI since September 2012 on behalf of advertisers in film, automotive, videogame and other categories.

 

Related:

 

It’s alive! Dynamic VOD ads are up, running and not all that scary (Feb. 11, 2013)

 

Canoe seeks a research blessing for VOD ads (Feb. 5, 2013)

 

Advanced advertising presses on, Canoe or not (March 1, 2012)

 

In wake of Canoe’s woes, RFI lives on (Feb. 27, 2012)

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The Biz, 2013-02-21T22:44:19+00:00
For TV stations, a booming Q4…with help from retrans http://zonewire.net/telescope/page/for-tv-stations-a-booming-q4...with-help-from-retrans#When:21:14:33Z Cable’s biggest local TV advertising rivals racked up strong revenue gains in Q4 thanks to three primary revenue drivers, one of which happens to be the cable companies themselves.

 

Advertising revenues from political candidates and campaigns were the biggest contributors to a booming quarter for local TV station owners, with automotive gains and contributions from retransmission deals also kicking in nicely. Year-over-year revenue gains from local station operations for the final three months of 2012 ranged from 14% (Belo Corp.) to an acquisition-aided 58.8% for Sinclair Broadcast Group. Station owners warn they won’t see those kinds of increases repeat in the 2013 off-year for elections, but in earnings calls over the last two weeks, there has been much rejoicing. Sinclair President and David Smith, for example, called 2012 “a remarkable year,” noting the company recorded record levels of political advertising while seeing a rebound in the automotive advertising category.

 

Most TV station revenue still comes from local and national spot advertisers. But in quarterly earnings reports and conference calls, station group executives also pointed to retransmission revenues from cable and satellite companies as a rising contributor. For Media General, the biggest percentage increase in Q4 revenue came from cable/satellite retrans revenues, which shot up 85% to $9.9 million as a result of late-year contract renewals. That compares to a gain of 5.4% in local advertising time sales (to $50.7 million) and a 1.4% rise in national spot advertising sales, to $25.2 million. Gannett also cited a “double-digit” increase in retrans revenue.

 

Even so, the local cable advertising category held its own in Q4 without the help of retrans income. Comcast reported Q4 advertising sales revenue was up 19.4%, and Time Warner Cable said its Q4 advertising revenue rose 29%, thanks mainly to the political spending injection.

 

If there’s a bright spot in the Q4 broadcaster reports for cable, it’s the resurgence of the automotive category that makes up the largest non-political local advertising account segment for television. Q4 automotive spending rose 21% for Media General, 10% for Meredith Corp. and 6.4% for Sinclair. Belo also pointed to “continued strength in the automotive category” as a revenue driver in the final three months of 2012.

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Local Ad Sales, The Biz, 2013-02-18T21:14:33+00:00
It’s alive! Dynamic VOD ads are up, running…and not all that scary http://zonewire.net/telescope/page/its-alive-dynamic-vod-ads-are-up-running-and-not-that-scary#When:05:46:30Z The cable network that’s all about scary is trying to take some of the fear out of dynamic VOD advertising.

 

Fearnet and its national advertising rep, Los Angeles-based Sony Pictures Television, are first out of the gate in selling dynamic advertising positions in viewer-requested video streams that run over cable and telco-video systems.

 

So far, says Paul Brennan, Sony’s SVP of Advertising Sales, nobody has run away screaming from the pitch. Instead, Sony has sold campaigns on Fearnet VOD to a group of advertisers across consumer brand categories including automotive (Volvo and others), film (Relativity Media, Anchor Bay Entertainment and others) video games (EA and Capcom) and television brands including AMC and Starz Entertainment.  “Because there’s a conscious decision of a viewer to be there, it’s a very strong place to advertise,” he says.  

 

Dynamic VOD advertising has been a long time coming. Although a handful of national cable networks have placed TV commercials within VOD programs over the past few years, most of the spots have been “hard-wired” into the program assets that sit on cable company video servers. That means the spots are wedded to physical ad positions, appearing within a program wherever and whenever it happens to be requested by a viewer at home.

 

It’s a buzz kill approach in the eyes of many for a couple of reasons. First, it has required that advertisers manage elaborate processes to get their commercials stitched into content several weeks before a program ever shows up on a VOD menu on the TV screen. In television time, that’s an eternity. Second, it overlooks some nifty advantages of dynamic VOD advertising, such as the ability to align commercial content not with physical content but with demographic or geographic viewer attributes. Third, it obviates the DAI promise of arming advertisers with detailed data about how many impressions their advertisements delivered.

 

2012 launch

Starting in September 2012, Fearnet took the wraps off a more sophisticated version of VOD advertising that starts to get at some of the reasons the medium excites people in the first place. Working with Comcast and using technology developed by the cable consortium Canoe Ventures, Sony began offering dynamic national advertising within free-to-watch movies planted on Comcast’s VOD service. That’s “dynamic,” meaning the commercial time Brennan sells is associated with individual viewing stream requests, rather than a particular program or movie.

 

Brennan, whose company also sells ad time for Sony properties including the PlayStation Network, said Fearnet offered a nice fit for introducing DAI on the national stage. For one thing, the network owned by a joint venture of Sony, Comcast and Lionsgate Entertainment has built up a solid following as a cable on-demand video service, owing to its 2006 origin as a VOD-and-online offering. (The linear TV version of Fearnet was launched in 2010.) The audience numbers reflect that, as Fearnet usually ranks as one of the top three U.S. VOD content services, generating anywhere from 6.5 million to 9 million stream requests monthly. Fearnet also has wide household coverage – at least by VOD standards – with a total reach into 29 million homes, 18 million of which are outfitted for DIA ad placement thanks to Comcast. Brennan expects that number to rise as Time Warner Cable and other cable companies look to extend Fearnet’s DAI capability over their VOD domains.

 

We talked with Brennan last week about his experience so far in staking out new terrain for dynamic VOD advertising. Here’s what he had to say about…

 

Inventory: Limited commercial presence is part of what makes Fearnet’s VOD ad pitch appealing. In a feature-length film, viewers won’t see more than 6 minutes of total advertising, divided among pre-roll (typically 1 minute), mid- roll (4 minutes) and post-roll (1 minute) ad positions. The lack of ad clutter “really makes advertisers stand out,” Brennan says.

 

Impressions: Here’s where some of the DAI magic comes in. Sony sells ads based on measured audience guarantees, not ratings estimates. So rather than place commercials into assigned programs and ad positions, Sony instead sets up DAI schedules so that advertisements are placed into whatever available position comes up next across the entire Fearnet content map. In other words, whenever a viewer fires up any movie from the Fearnet VOD menu, that viewer will see whatever commercial is next in line to achieve an impression. A different viewer requesting the same movie five minutes later could see a different commercial in the same pre-, post- or mid-roll pod the first viewer watched.

 

Content flexibility: Those pre-, mid- and post-roll positions aren’t just for traditional 30-second ads. Sony encourages advertisers to run longer-form spots if it suits a creative purpose. Two-minute movie trailers are an example.

 

Timing: The lead time for creative from advertisers is about five days – a big improvement from the 3 to 4 weeks that used to be demanded for VOD ad insertion. “That’s a huge achievement,” Brennan says.

 

Selling: Brennan said there’s an education effort required for clients and agencies that are new to the DAI category. But most are familiar at least in concept with how DAI works. Sony has worked with both national broadcast TV buying departments and digital/new media buying teams, depending on agency preferences.

 

What’s next: Sony hasn’t yet dabbled in one gee-whiz attribute of DAI, which is to plant different commercials into different streams based on demographic or geographic attributes of a viewing household. The idea so far is to prove out the delivery capabilities of dynamic insertion nationally. But Brennan says Sony is working with Canoe now to refine technology and processes enabling household targeting. 

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Technology, The Biz, 2013-02-12T05:46:30+00:00
Optimum West deal will give Charter $10 mil.-plus in ad revenues http://zonewire.net/telescope/page/optimum-west-deal-will-give-charter-10-mil.-plus-in-ad-revenues#When:18:40:24Z Charter Communications Inc. won’t just get 300,000 more cable TV subscribers when it closes on the acquisition of Cablevision Systems Corp.’s western U.S. division. It also adds local advertising operations in four states that should add more than $10 million annually to Charter’s advertising revenue.

 

Cablevision is selling its Optimum West unit to Charter for $1.6 billion in a deal expected to be completed after mid-year. The system group, formerly owned by Bresnan Communications, includes advertising operations in Montana and Wyoming that are managed by Optimum directly, along with ad sales operations in Utah and Colorado that are repped by Comcast Spotlight.

 

It probably makes sense for those representation arrangements to stay in place after the transaction happens, given that Charter Media has no physical presence in Utah or Colorado. Charter Media’s west division, which has the closest geographic alignment with Optimum West, manages ad sales operations in California, Nevada, Oregon and Washington.

 

In 2011, the Optimum West group produced $11.6 million in advertising revenue, according to Cablevision’s 2012 annual report to shareholders. That equals about $36 per subscriber in annual revenue. (Charter Media’s advertising revenue for the last full year reported, 2011, was $292 million.)

 

Optimum Media’s biggest market is Billings, where Optimum offers TV ad placement on 36 networks spanning 8 ZIP codes. Other Montana markets include Bozeman (31 networks and 5 ZIP codes), Helena (31 networks/7 ZIPs) and Missoula (31 networks/14 ZIPs).

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The Biz, 2013-02-08T18:40:24+00:00
Canoe seeks a research blessing for VOD ads http://zonewire.net/telescope/page/canoe-seeks-a-research-blessing-for-vod-ads#When:17:54:46Z Since the 1960s, the NY-based Media Ratings Council has evaluated the worth of audience research approaches designed to divine who sees and hears what in the electronic media age. Now, the industry-funded group is about to get its first exposure to cable-delivered VOD advertising measurement.

 

The cable industry advanced advertising development firm Canoe Ventures Inc. has submitted a reporting service for VOD Dynamic Advertising Insertion (DAI) to the MRC as part of the research group’s accreditation process. If all goes well, the reporting service will end up being blessed as a valid and accepted way to track how many people see national TV commercials placed within the on-demand video streams that cable companies like Comcast and Time Warner Cable deliver. Specifically, the Canoe service provides “ad impression delivery reports to its National Programming clients who utilize the Canoe VOD Dynamic Ad Insertion service,” according to a Canoe press release.

 

Canoe said yesterday it has entered into a pre-audit phase of the MRC’s accreditation work. The next step is for the MRC to engage a certified public accounting firm to dig into the DAI service. After that, an MRC audit committee will review the findings and make a recommendation on whether to accredit the Canoe service. The idea is to determine whether the Canoe service complies with overarching measurement guidelines that undergird the ad-supported TV business at large.

 

One significant angle is that Canoe’s DAI reporting service gets its raw viewership data directly from video servers maintained by cable operators, affirmed Canoe’s Chris Pizzuro, who heads sales and marketing. It’s part of a rising movement to go beyond panel-based estimates and instead capture granular viewing data directly from the machinery of the digital video age.  

 

George Ivie, MRC’s Executive Director and CEO, said the accreditation effort “ultimately will help marketers have confidence in the role that VOD DAI can play as part of their media mix.”

 

Moving on...

Incidentally, some former Canoe executives are now showing up in new job posts after a 2012 purge tied to a significant down-sizing of Canoe’s ambitions. Former Chief Marketing Officer Vicki Lins, earlier a Comcast Spotlight marketing executive, joined Clear Channel Outdoor as CMO for the billboard-advertising provider. Her former Canoe colleague, David Grabert, joins her as VP/Marketing and Communications for Clear Channel Outdoor. He was Canoe’s top communication and press officer. Also moving on is Jonathan Bokor, an ex-Walt Disney Interactive specialist and Canoe’s former GM of Interactive TV. He joined MediaVest as Senior VP and Director of Advanced Media. And last October, former Canoe Chief Technology Officer Arthur Orduna joined ADT Corp. as Chief Innovation Officer.

 

Related:

In wake of Canoe’s woes, RFI lives on (ZoneWire, Feb. 27, 2012)

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Research, 2013-02-05T17:54:46+00:00
Dynamic VOD may add to cable‚Äôs local inventory stockpile http://zonewire.net/telescope/page/dynamic-vod-may-add-to-cables-local-inventory-stockpile#When:17:11:29Z As long as we’ve been covering the cable advertising business, we’ve heard local cable advertising executives clamor for an essential growth ingredient: more ad inventory from cable networks.

 

Now, thanks to some new wrinkles in video distribution technology, they may be getting it.

 

That’s according to Chris Hock, SVP of Product Management and Marketing for BlackArrow, a major technology player in cable’s advanced advertising world. In a briefing yesterday, Hock told me how some early-stage deals are shaping up between cable distributors and national networks as dynamic on-demand TV advertising becomes more common. BlackArrow, which provides platforms that guide commercials into assigned VOD video streams (and then some), has an especially close view of the advanced advertising marketplace.

 

Linear-plus

A significant breakthrough here is the emergence of an industry term known as “linear-plus,” which describes the basic outline for inventory allocation agreements between cable networks and their cable distributors. “Linear plus” means networks generally are providing affiliates at least the equivalent number of minutes in ad-supported VOD programs that the networks provide within linear airings – and sometimes more. So if affiliates normally get 2 minutes of local advertising time per hour from a network – or 1 minute per half-hour – the “linear plus” equation means they’re often getting extra ad time to sell within VOD streams of the same programming.

 

Arcane though it may seem, any suggestion that networks are willing to offer up more local ad time is a breakthrough for cable companies, especially if it involves marquee content.

 

But it makes perfect sense. National cable networks depend on cable companies to provide the machinery that enables dynamic advertising – the association of discrete commercials with discrete viewer-selected VOD streams. Without a complex technology ecosystem that involves cable VOD systems and advertising placement platforms like BlackArrow’s, national networks have no way to accommodate dynamic advertising within their VOD programs. Thus, the negotiating leverage here tilts to the distributor side, accounting for more generous allocations of local inventory.

 

Exactly how that inventory is carved up within a VOD program stream is subject to negotiation, with different networks choosing different combinations of advertising availabilities within programs, observes Hock. For instance, it’s possible that a national advertiser might own the initial pre-roll position within a VOD program stream, and a local advertiser might occupy a mid-roll avail or two. Those arrangements vary by program, and their outcome produces the set of “business rules” that determine which ads appear where within ad-supported VOD titles.

 

Related:

VOD: cable’s solution to the limits of time? (ZoneWire, March 12, 2012)

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Technology, Local Ad Sales, 2013-01-31T17:11:29+00:00
Geo-specific TV ads: more players emerge in cable’s backyard http://zonewire.net/telescope/page/geo-specific-tv-ads-more-players-emerge-in-cables-backyard#When:16:02:35Z Forget Groupon. Today’s sweetest daily deal comes from an upstart national video programmer that’s offering 30-second local TV spots for $2.50.

 

Not $2,500. Not $250. $2.50.

 

The bargain-basement price comes from music producer Chris Black’s Black Pearl Media Group Inc., which is courting advertisers with the promise of ZIP code-specific commercial placement across a virtual-MSO network launched by a Los Angeles-based start-up, Wisecast Television. Black Pearl says its music and entertainment channels cover 43,000 ZIP codes (now there’s a novel way to couch a distribution story), reaching homes that have downloaded Wisecast’s software or connected a proprietary set-top box to HD TV sets.

 

It’s a fringe play at best on the national media scene. But the intriguing angle here is the notion that national TV programmers are starting to promote geographically specific placement of TV spots – a sliver of the TV ad business that historically has been owned by local cable systems.

 

Black Pearl accomplishes the feat through a variation of “dynamic” ad insertion, meaning advertisers can supply creative directly to Black’s production company, where it gets parsed out among specific household groups via a geo-coding approach. The whole thing rides across an IP broadcast network launched by Wisecast, a sort of Vimeo-modeled platform for aspiring entertainment producers. (And one that seems to have an outlandish view of profit potential for its contributing partners.)

 

The bigger story is that cable companies are going to start seeing competition for geo-specific television advertising placement. A variety of online video ad syndicators like Tremor Video, for example, make geo-targeting a standard online video campaign offering. YouTube also began offering geo-specific in-stream ad insertion in 2010, targeting political campaigns, among other categories.

 

The upside for cable is that as geo-specific video advertising choices broaden, cable should retain a significant advantage over centralized competitors through its local feet-on-the-street presence. Even in an era of online video competitors large and small, there’s no substitute for a sales force that can call on advertisers in local markets – and negotiate rates that are north of $2.50 a spot.

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Local Ad Sales, 2013-01-30T16:02:35+00:00
For 3DTV, local commercials are slow to arrive on the scene http://zonewire.net/telescope/page/for-3dtv-local-commercials-are-slow-to-arrive#When:03:56:53Z For Comcast customers, there’s more TV to watch in 3D starting this week. But don’t expect to see local commercials televised in the video format anytime soon.

 

A spokesperson for Comcast’s advertising sales group, Comcast Spotlight, said there's little going on yet with local 3DTV advertising. That’s despite a rising population of 3D-capable households and an increasing amount of content piped into homes by Comcast, along with other cable companies.

 

The latest addition for Comcast is an extra three hours a day of 3D programming that will air at least five days a week, thanks to a new arrangement with 3net, the 3DTV programming service owned by Discovery Communications, Sony and IMAX. Comcast will add 3net shows including “River Monsters 3D” and “Forgotten Planet” to a dedicated 3D channel on Comcast’s Xfinity digital TV lineup starting today.

 

For awhile now, there have been high hopes that 3D could help advertisers make a big impact by wowing viewers with impressive visuals. In April 2010, the commercial-delivery firm DG Fastchannel introduced a new service to shuttle 3D spots to its TV industry clients, reasoning that “it will only be a matter of time before 3-D becomes widespread.” But aside from a few national commercials aired by companies including Procter & Gamble, Disney and Samsung on ESPN 3D, the category has largely been dormant as an advertising medium.

 

It’s likely to stay that way until firmer evidence indicates there’s a meaningful population of viewers. Right now the numbers for household penetration of 3D-capable TV sets look impressive, with the Consumer Electronics Association estimating roughly 20% of U.S. homes have a set that can display 3D images. But there’s a vast difference between the presence of a 3D-capable set (most new HD sets have 3D signal processing built in) and the presence of a human being who’s watching programming in 3D. A recent CEA survey found 42% of 3D TV set owners watch at least five hours of 3D content weekly, but the same study, according to Variety, found nearly half of all owners either lack 3D viewing glasses or don’t watch 3D programming at all.

 

USA Today recently parsed the numbers, reporting that at best, only around 110,000 households were watching 3D programming nationally at any given time last September. Slice that population down to a local-DMA level and you can see why Comcast and other multichannel video providers aren’t yet putting emphasis and investment in airing 3D ads, despite a rising amount of TV sets in the marketplace and a rising amount of programming on the lineup.

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Technology, 2013-01-28T03:56:53+00:00
NCC Media puts spotlight on cable’s web portals http://zonewire.net/telescope/page/ncc-media-puts-spotlight-on-cables-web-portals#When:17:43:58Z NCC Media is putting more marketing emphasis on an emerging star of the local cable advertising stage:  the online customer portals maintained by its cable company partners.

 

A new online media kit out today provides more detail than we’ve seen in the past about the metrics associated with the websites cable companies maintain to offer customer care applications, local news, email logins and other traffic-attracting features. According to NCC:

 

  • 60 million people use cable portals (or “gateways,” as NCC calls them) as their browser home pages, producing 5 billion page views monthly. As NCC points out, “In total that is more page views than weather.com.” Locally, the cable gateways also stand out: In Boston, for example, comScore data from May 2012 show Comcast’s xfinity.com portal attracted 1.26 million unique visitors, more than The Boston Globe’s boston.com (1.1 million) or CBS Boston’s 317,000.

 

  • Cable gateways are ranked No. 1 for local page views in 25 of the top 30 U.S. DMAs 

     

  • Localized content and geographically targeted footprints mean advertisements placed on the cable gateway sites “stay in your intended market.” That’s a dig at rival news and information sites maintained by local broadcasters and newspapers. NCC says ads means to reach users within specific ZIP codes on these sites often generate most of their views from outside the intended geographies.

 

Cable companies and their rep firms are putting more emphasis on local ad placement across customer portals as interest in online advertising rises. There’s not much available data around the success rates, but in a 2011 Cable Show panel session, Comcast Spotlight Charlie Thurston said ad revenues from Comcast’s customer web portal exceeded $65 million.

 

Here are cable portal use statistics from selected markets as reported by NCC:

 

 

 

 

 

 

Related:

 

Portal potential: there’s big business in cable’s customer websites (ZoneWire, July 7, 2011)

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The Biz, 2013-01-22T17:43:58+00:00
Smart TVs play major role in Gracenote’s addressable ad ambitions http://zonewire.net/telescope/page/smart-tvs-play-major-role-in-gracenotes-addressable-ad-ambitions#When:02:03:42Z A new breed of “smart” TV sets is key to the birth (finally) of an addressable advertising business for television, says the president of Sony's Gracenote unit, Stephen White. And he's engaged three partners to try to prove it.

 

Gracenote’s new partnerships with Invidi Technologies Corp., mDialog and DG provide technology building blocks for achieving a long-sought dream of TV advertising – a way to make the commercial you see different from (and to you, more relevant than) the one your neighbor sees, even though you’re both watching the same ad break in the same TV show. Here’s what each company is contributing:

 

Invidi will allow Gracenote to tap into Invidi’s ad decisioning engine, which allows advertisers to target certain household groups with specific commercial creative. (Press release.)

 

mDialog will use its video streaming network to shuttle TV ads to assigned smart TVs or other IP devices. (Press release.)

 

TV ad distributor DG will work with Gracenote to supply clients’ commercials to network ingest points. (Press release.)

 

New wrinkles
You’ve seen the teaser for the addressable advertising movie before, but Gracenote is applying some new wrinkles that could make this version worth watching. In addition to the partnerships, a major addition is content-recognition technology, the core capability that underlies Gracenote’s work for Amazon and Apple Inc.’s iTunes, among others. By applying audio and video fingerprinting techniques to television, Gracenote identifies what you’re watching over the TV set, whether it’s a live program, DVR-replayed content or even commercials themselves.

 

Why does that matter? Gracenote's White thinks a real-time map of what TV viewers actually watch provides a rich dataset about interests, lifestyles and buying behavior that broader (read: Nielsen) panel extrapolations can’t match. Thus, it’s possible to align commercial creative more closely with what appeals to viewers – right down to inserting a commercial about an adventure-travel vacation to people who took part in a European river tour last year.

 

That’s one of the test cases Gracenote showed this month at CES, where it took the wraps off a new TV ad-targeting platform that’s highly dependent on a growing population of “smart TV” sets. In Las Vegas, the demos played out over a 2011 Sony Bravia smart TV. Gracenote showed how one of three different Toyota Motor Co. commercials could be streamed and overlaid on top of a linear network ad break via the mDialog Internet delivery network. The end result mimics a traditional linear ad insertion. “To the consumer, it’s seamless,” says White. “They just see an ad.”

 

Our take: For cable ad specialists, the idea is a mixed bag. On the positive side, the capabilities produced by the Gracenote-Invidi-mDialog trio can be applied to at least a subset of cable-subscribing households – those with advanced digital set-tops that have IP connections and enough computing power to handle the file management processes required for selecting and exporting overlaid TV spots. Also, cable ad sales groups stand to benefit from the inventory-expanding qualities of Gracenote’s addressable advertising scheme. The ability to carve a 30-second avail across several demographic or behavioral cohorts effectively multiplies the number of “spots” a cable company can sell, helping to solve a longstanding challenge around limited TV inventory.

 

The downside is that many of cable’s subscribing homes aren’t equipped with enough set-top firepower. That could leave cable vulnerable to standing on the sideline while addressable ad activity takes place across non-allied terrain, namely the Internet and a budding population of smart TVs with built-in microprocessors and IP connections. (Research conducted for video advertising provider YuMe by Frank Magid & Associates in December 2012 estimates 11% of U.S. homes now have smart TV sets, and 35% of homes have TV sets connected to the Internet either through native functionality or devices such as Blu-ray players. Here’s the .pdf.)

 

Neutral perspective
For his part, White isn’t choosing sides.  He says Gracenote recognizes the importance of playing nicely within an ad-supported TV ecosystem that involves over-the-air broadcasters, satellite TV distributors, cable companies, national TV networks and media buyers. “We’re not suggesting that tomorrow we’re going to blow this model up,” he says. “We get that the cable and satellite guys want to participate here.”

 

Whatever the go-to-market conduit, White says Gracenote’s in the TV game for good. “TV advertising as a business has been kind of the same animal for a long time,” he says. “Now we have a real opportunity to make it more focused and relevant.”

 

Related:

Invidi, veritas: Addressable ad provider is poised for impact (ZoneWire, Sept. 25, 2011)

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2013-01-18T02:03:42+00:00