Wednesday

Addressable Advertising Pushes the Television Evolution



The recent B&C Content Show dedicated a full half day to discussions regarding the advancements in addressable advertising, TV programmatic and transforming traditional advertising. But it was also a love song to STB data, segmentation, ROI data and analytics.

Addressable advertising is reaching scale according to Jaime Power of GroupM’s Mobi Media who said that the footprint is currently "42 million HH and expected to grow to 60 million HH" with a steady expansion from local into scatter and national outplays." But he cautioned that "addressable will not replace traditional TV because we need traditional TV for reach." I agree with Power to a point because I believe that traditional TV itself needs to evolve from a spots and dots sales model to segmentation and proof of ROI. Addressable may facilitate traditional TV’s evolution especially as addressability rolls out to a more nationalized  distribution and as television itself becomes more digital in the world of 100% smart TVs.

The Traditional TV Model is Changing
The television business has been undergoing stress and change. Sales are down across many networks and projections indicate that the trend could continue. When asked if Addressable can save the TV environment, Power replied that "TV has to evolve- it is unrecognizable compared to ten years ago. We need to understand the new landscape and find ways to measure it. Not all customers are the same. We need to need to get to the custom level and reach core segments. Like purchase data where we can locate not just households with a dog but households that buy a certain dog food. You need to prove you can steal share by honing in on people's viewing behavior. We are using STB data and working close with analytics teams."

Research and Analytics are Critical
Virtually every panel touched on the need for measurement, targeting, analytics and usable data sets as part of their company's addressable initiative. Ben Tatta of Cablevision explained that "Data analytics is a new thing for television. Now we are conducting forensics on the data, on exposure and on response. (we recognize the ) importance of first party data. For the first time advertisers can use their own customer file. Age and gender have been proxies. We now don't have to do modeling. We are literally counting Sales." Keith Kazerman of DirectTV fielded "over 500 campaigns this year where we go into deep analytics that are more than age and gender."

What is Big Data?
A panel on big data moderated by Barry Frey of the DPAA was tasked with defining big data. According to Chris Pizzurro of Canoe, "For us big data is about a ton of small data. We dig in and bring up insights from that. We measure each individual ad." Eric Schmitt of Allant had a slightly different view saying "We see big data and bigger data. Big data is 120 million TV households. Bigger data is activity data. We bring them together in a privacy safe way getting to audience based models across a range of platforms."

Sales Feels the Pressure
The pressures on the traditional TV sales model are coming from several angles. AMC’s Arlene Manos said that “TV advertising has to change. We didn't have the tools and weren't asked for the accountability but now we have accountability in digital and they want it in TV.” Mobi’s Seth Walters cast a more somber note explaining that “a clunky interface is part of the reason that viewers go OTT. Netflix is another reason. Roku is far easier to navigate and in some cases they are faster. Viewers can easily and quickly identify content that matters to them. What is the role of TV advertising once that occurs?” The sales solution? Brian Stempeck of The Trade Desk believes that it is “inevitable that TV will go programmatic.”

Despite all of the hand wringing I believe that traditional television has succeeded for over 60 years because it responds to change and continuously evolves. There has always been competition from other platforms from radio and print to digital devices. While we continue to grapple with how to evolve the business model in this changing environment, new successful solutions will be found. As Adam Lowy of Dish concluded,“Eventually we will get there. TV is the first screen.” I agree.

Monday

TV - Evolution or Revolution? A Look at B&C's MultiPlatform Conference




There is more chatter than usual about the future of the traditional TV model with hand wringing across all media disciplines from measurement, to technology, to consumer affinities, to platform usage and business silos. Can MVPDs keep up with the pace of change? Can content providers maximize the value of their offerings across platforms? What is the future of TVE, OTT, TV programmatic on the core business? 

There are no pan-industry experts (that I know of) but there are astute minds in specific areas. So when one attends a conference that places experts across the spectrum in one venue, it is a cornucopia of ideas and revelations. Such was the recent B&C MultiChannel Content Show which included panels on MultiPlatform and Addressable Advertising.

There were so many great panels and speakers that the following takeaways are from the MulitPlaform conference. Addressable Advertising takeaways will follow in a future column:

Authentication is Still Not Where It Should Be
OTT, it was generally agreed, was a good thing for consumers, MVPDs and content providers. But authentication remains a roadblock for many consumers. Marty Roberts from The Platform admitted that "as a technologist, there is still more to do (with authentication).  Authentication is now at about 55%. That is not good enough. Consumers want to login and just watch their show. The problem is that consumers don't know their credentials. "

Measurement is Improving But is Not There Yet. And Stubborn Silos Remain
Cross platform measurement has seen some recent improvements but there is still much to be done including breaking down the measurement silos by combining measurement platforms, evolving the business model away from proxy measures and forming common metrics across platforms.
TWC's Joan Gillman explained that "We have trained the consumers to consume media whenever and wherever they want but what hasn't caught up is the measurement. Long tails don't get credit." That is because TV buying continues to be bought by age gender proxy. However Big Data is slowly moving the measurement needle. AT&T 's Kristyn Clement noted that "We are moving away from the Nielsen panel. We might use Rentrak or Nielsen or both and we will continue to see that evolve. The days of a single currency has past us."

Jane Clarke of CIMM believes that “We will probably end up with two (measurement) layers; A planning layer with a holistic measurement and a system that gets to unduplicated content and ad measurement in single system. But actual trading currency probably needs a trading platform. Advertisers want purchaser targets. They no longer want w25-54. So we will also need a transactional layer to get the right ad to right person at right time.”

Some believe that measurement challenges will be solved over time as older viewers give way to younger who have very different consumption preferences. Ian Greenblatt of ARRIS noted that “The under-measurement of OTT is generational. Younger viewers will actively search out quality content in whichever silo it is living.”

Content Truisms Remain Truisms ... Until They Don’t
How many times have we heard that content is king? That is still true; Without good, compelling, engaging content, our quest for better measurement and monetization is quixotic. The interesting nuance to this is how different forms of content succeed in different ways depending on the technology. Fewer television series are viewed live with viewers preferring to watch on their own schedules, on a variety of devices and via other content aggregators. News and Sports, however, continue to be viewed live, albeit on a wider range of platforms. Obviously, consumers will decide the TV model. Penthera’s Michael Willner says, “I admit I am getting more into watching programs on my iPad. Though it will be the consumers who will decide how TV evolves.”

Better Technology is Always on the Horizon - Keep on Top of It
Technology is advancing faster than it can be accommodated into the media business but many of these new innovations can result in greater profitability for savvy companies. Optimization of ad avail pricing is essentially here. Greenblatt says that “Ad tech is one of the hottest areas. There are lots of new players there. (It will soon be possible to) price upcoming avails in a stream leading to pricing in real time. You can digitally insert specific ad for specific audience in specific time and dynamically re- price.”

In the area of content, the sophistication of new viewing platforms may require more careful integration of technology to maximize the viewer experience. Jens Loeffler of Adobe noted that “Sports is challenging technically in cross platform. There is a need for higher resolution and frame rates for fast moving content. We need to focus on good compression and capacity.” In fact technological needs vary by sport. According to Eric Black of NBC sports, “In golf and swimming, compression is critically important. We need to differentiate tuning for a specific sport.”

Don't Fear Change
The only way to succeed today is to embrace change. Some companies are immersed in advancement but there are still too many that are mired in inaction - preferring to stick to the traditional way of doing business until forced to react. Rentrak’s Bruce Goerlich noted that "Inertia is our biggest challenge." Taking a chance is risky but change-paralysis is riskier. According to Willner, "By far the most successful businesses are ones who understand consumers’ behaviors and how they change.  If we spend time protecting the status quo someone else will come along with the best new widget. So we need to change or perish."

Fostering this atmosphere of rapid change are the accelerating announcements of mergers, acquisitions and new inventions / methodologies whether it is TWC and Cablevision or CBS or HBO. Where is your company in the discussion?

First published, in abbreviated form, on MediaPost.com

Wednesday

Digital Placed Based Media Makes Its Big Move



As if the current television environment isn't challenging enough with flat expected revenue, expanding linear viewing choices, audience fragmentation, cross platform viewing, VOD, DVR, and commercial ratings, there is apparently a new set of challenges eroding potential ad dollars according to the DPAA at its recent conference.

This challenge to media ad dollars may be coming from the most unlikely places - a taxi, an elevator or even a gas pump.  In this ever expanding and developing area of digital placed based media, any place where the consumer journey takes place is an opportunity to reach them via a screen. And digital placed based media is already recognized by brands and advertisers as valuable opportunities to reach their target consumer.  As Jack Haberman at Colgate Palmolive says, "Video is the new day part". That means that viewers are no longer tethered to the home screen… or any one based device... or by any time of day. Prime time can be any time and any place; morning at the gym, lunchtime at your desk, commutation in a cab or train.

Consumers Rule
The proliferation of screens into all aspects of everyday life, both inside and outside the home, presents both opportunities and challenges for media companies, advertisers, brands and data companies. According to Francois De Gaspe Beaubien, chairman of the DPAA, "Consumers are spending most of their time out of the home. People are interacting with screens outside of their homes." That means that there is more competition for attention and more of a consumer driven environment for placing content. And with prescient content owners like HBO deciding to go OTT, it looks more and more like the content delivery chain, like everything else in media today, is fragmenting and morphing. More native advertising, more binging, more multi-tasking is coupled with less reliable measurement, less concentrated viewer attention and less control of the chain by the old television guard.

Who is to Blame?
There is certainly enough blame to go around. Technology certainly plays a large role in this disruption. Jack Myers gave an inspiring talk about how technology is forever changing media habits. He says, “The fundamental culture of our business is changing. Every minute of every day, consumers’ media habits are radically different than they were last year, two years ago, ten years ago and certainly dramatically different than they were 20 years ago.”

But in addition to technology, traditional media’s way of doing business also contributes to the viewers’ changing habits. Ad time within a TV program can be more than 25% of the program run time. Commercial pods are getting longer, encouraging viewers to find ways to avoid ads. BTIG’s Rich Greenfield noted that “Binge viewing drives more binge viewing. We are learning to watch in a certain way. We are training consumers to avoid ads.”

Challenges – Measurement, Privacy and Fraud
However, digital placed media has a few challenges as well. For one, there is no standard accredited measurement across all OOH platforms. The current Nielsen measurement consists of audience studies that are conducted as proprietary research with each study funded by the measured network. Nielsen then takes these studies across all measured nets and compiles into one report that is issued quarterly to the marketplace. According to MediaVest’s David Shiffman “A few years back, the DPAA issued specific guidelines for their members to follow for audience measurement with the goal to help ensure some standardization in what gets measured and how it is measured.”

There is also the privacy concern. Deutsch’s Anush Prabhu noted that “there is a lot more data available today. We can tell your geo location from your phone which is cool but also creepy.” Microsoft’s Natasha Hritzuk added, “Consumers are aware that their data is being collected. It is the lack of transparency as to how we are using the data that is the problem. We need simple conditions that we can opt into and a clear value exchange.”

Fraud is another concern. As Barry Frey, President and CEO of the DPAA remarked, “Kraft has said that 75-85% of their data is fraudulent and they will not use it.” Companies are responding to this challenge. According to MEC’s Shenan Reed, “We are going to 100% viewable which is higher than the industry standard. We will only pay for something that is 100% viewable.”


Ultimately, the DPAA conference was a high note for digital placed based media. As Frey concluded, "We received terrific feedback on this year's Video Everywhere Summit from many of the record 700+ people in attendance. The sessions covered not only issues specific to the rapidly growing digital place based media sector, but those of importance to the overall media and advertising ecosystem as well. It's always rewarding and exhilarating when so many months of planning coalesce into a worthwhile day for so many people." See a video of some of the highlights of the DPAA conference here. (insert link or embed)





Tuesday

The End of Traditional Cable Television. Q&A with Peter Redford



For those who cling to the traditional ways of doing business, a discussion with ILOOK’s CEO Peter Redford will send shivers down your spine. 

Redford has a long history in media improvement and disruption. He was there in the beginning with the development of the mouse, the laser printer, GUI and the Ethernet while working for PARC right out of graduate school. “The public would not see these technologies for several more years. The PARC experience changed my life — it reinforced in me the notion that ANYTHING is possible. It also got me hooked on electronic media.”

From there, Redford got his hands into micro-processing, sound cards, flash and developing the first steps towards touch technology. Eventually he started his own company ILOOK which is focused on changing the face of traditional cable television.

I sat down with Peter and asked him the following questions:

CW: What is your background - how did you get to where you are today?

PR: I graduated from UC Berkeley in 1977 with a master’s degree in integrated circuit (chip) design, which was the hottest field at the time (like Big Data is today). Then I was hired out of school by Xerox PARC to be on their research staff to develop a methodology for the design of VLSI (very large scale integration) chips. We also worked on the graphical user interface (GUI), the Ethernet, the mouse, the laser printer and electronic media.

Eventually I was recruited by Zilog to help them design the Z80 microprocessor. It turned out to be the most popular microprocessor ever designed. Zilog was acquired by EXXON and I received a small windfall from my stock options. Shortly after that, with this small windfall and a Zilog engineer named Jim Miller, I started my first company, Redford-Miller Productions (RMP). Inspired by Star Wars, our mission was to develop advanced electronic media technology and to use it to produce science fiction movies. The first advanced technology was going to be a 16-bit digital mixer, modeled after a room-sized digital mixer that Jim used while studying at Stanford. We finished our version in 1982 and it fit into two ganged IBM PCs. In late 1982, Yamaha purchased our digital mixer technology and integrated it into a chip-set that became known as the Sound Blaster sound card. We never did produce a movie.

I took this second small windfall and in January of 1983 started my second company, Trillian Computer. My mission was to develop the first ever animation engine that would run on the IBM PC. We called it Action.  By 1984, Action was used by virtually all PC software companies to create product demos and tutorials. In 1986 the technology was acquired by Macromedia and, when Adobe acquired Macromedia, became known as Flash.

I took this third small windfall and in January 1990 started a company called TV Interactive (TVI). My mission was to create a technology that merged the personal computer with the television set and was useable even by small children. By 1993 we had a “touch-&-view” technology called AirPlay. When a child touched a picture of a horse on a printed page (2nd screen), the page signaled a computer (1st screen) which played a short video about horses. The video was stored on a CD. We quickly realized, however, that an adult was needed to start the CD because the process required many keystrokes and mouse clicks (and the reading of an entire page of instructions). So, we developed another technology which we called AutoPlay. Now the child simply inserted the CD into the drive and the correct program started automatically. After we filed fourteen patents for both technologies we showed them to Microsoft, hoping that they would include AutoPlay in the forthcoming Windows 95. Just a few months after our meeting, Microsoft did include AutoPlay in Windows 95 — without a license from TVI. When all the AutoPlay patents were granted in 2004, I sued Microsoft (along with all PC, DVD and Blu-ray player manufacturers) for infringement — and won! 

In 2009 I took this not-so-small windfall and started a company called ILOOK. My mission was to develop a television platform that would be a successor to traditional cable.



CW: Tell me about your company and your role in it.


PR: I am the CEO of ILOOK Corporation, located in San Jose, CA.  ILOOK is a cloud-powered OTT television platform, modeled after traditional cable, that instantly converts YouTube channels into branded mobile "channel apps" enabling: “Amazon of TV networks” and “GoogleAds of TV commercials”; video plays on mobile or connected TV; zero-cost broadcasting; e-commerce enabled commercials; and a user-customizable, “touch & view” program guide on the user’s mobile device.



“Amazon of TV networks” implies an infinite “shelf space” for TV networks — so, anyone can create and operate a TV network on ILOOK. “GoogleAds of TV commercials” means that ILOOK inserts TV commercials into TV networks just like Google inserts text ads into websites. The end result is an Ebay-like marketplace that crowd sources an infinite number of ads (TV commercials) and add-space (TV networks). ILOOK keeps 10% of TV commercial revenue, 90% goes to channel app owners. 



TV viewers download only the channels they want from app stores to their mobile device screens. Starting a “channel app” displays the program guide. Touching a program listing plays the program on the mobile screen or on any connected TV screen.  



CW: How would a specific channel break through the clutter?



PR: To discover Channel Apps of interest, a TV viewer typically performs a simple keyword search. Channel Apps in the search result can be listed according to different sort orders such as most popular or newest on top. Although there may be millions of available Channel Apps, the viewer only downloads a small handful that will be watched repeatedly. Just like with print magazines -- there are over 18,000 of them in the US but most people only subscribe to 2 or 3. 



CW: Wouldn’t this fragment the network market and create tiny networks?



PR: Yes, there will be thousands or even millions of affinity networks. The US print magazine industry has  18,000 magazines that represent 265 interests (affinities). The lower barrier to entry when creating a TV network on ILOOK compared to printing a magazine will make it cost-effective to cover even narrower areas of interest via a huge number of special interest networks. 



CW: What measurement would you use – what are some of the metrics you would report?



PR: Which videos were watched, when, how much of each video was watched. Did the viewer "Like" the video or share it. How much of each commercial was watched. How often did the advertised product generate a viewer response. 



CW: Would you use a form of programmatic buying?



PR: Yes. A video playing on the mobile or TV screen can trigger the display of a Buy Now Button on the mobile screen. Also, a video's information pane can include a Buy Now button. 



CW: How would this work on connected TVs?



PR: The connected TV is just a "slave" display for the mobile device. All the user activities, such as buying or searching are always performed by the mobile device. 



However, when a mobile device commands a connected TV to play a video, the video streams from the cloud directly to the TV -- not through  the mobile device. This saves battery power and allows the phone to be used for other tasks (such as making a call). 



CW: Is this multi-platform?



PR: Yes. iOS now, Android in Q4. 




CW: Where do you see the media landscape in the next 3-5 years. Give me some predictions.



PR: Let’s see…

1.  The Internet will become the preferred “pipe” for TV providers, replacing cable/satellite/telco pipes. This will be mostly because of Internet's lower cost compared to proprietary cable/sat/telco networks and because it will enable new services such as e-commerce enabled commercials.



2.  All TV commercials will become e-commerce enabled. For example, a TV commercial playing on a TV screen will trigger the display of a Buy Now button on the viewer’s mobile device. This will have profound implications on the effectiveness of advertising by reducing the “impulse-to-purchase” time to zero.



3.  The 2nd screen (mobile device) will become a de-facto, “touch & view" electronic program guide (EPG). Video will play on the 1st screen (TV) or on the 2nd screen (mobile) but the EPG will always be displayed only on the 2nd screen. This will ensure a consistent UI independent of which screen the video is playing on, and will make it simple to switch screens. All TV “brains” will be in the mobile device. The TV will be just a dumb display device.



4.  Media players such as Roku, AppleTV and Amazon Fire will disappear to be replaced by “thin clients” like Chromecast that will be embedded in dongles like the current Chromecast and directly in TVs. The media player approach is a dead-end because it does not allow touch & view (a dedicated remote must be used), does not allow screen switching (because the “brain” is in the box that is physically connected to a TV)  and is more expensive (since it needs lots of memory to store channel apps and to display the program guide). Thin clients rely the mobile device to store the channel apps and to display the program guide.


First published, in abbreviated form, on MediaPost.com