Smart TV Will Evolve. Not From Apps But From Media Companies. Interview with Oded Napchi.

Oded Napchi, CMO of HIRO Media, is currently immersed in the world of programmatic video for brands and traditional TV content providers. His media career, which began in the 1990s in Israeli radio and television, soon moved into online with work on a start-up called Valis which was the first telecom based community in SMS. 

Napchi explains that his current firm, HIRO Media, derived its name from the protagonist of the book, Snowcrash, which is a science fiction novel mapped out how mass media will look in the future. HIRO Media, the company, founded in 2006, was founded to enable legal peer to peer downloads for content providers. “We always wanted to expand the numbers of sites that present video beyond the major five,” he added.

Charlene Weisler: Tell me about HIRO Media.

Oded Napchi: We are a programmatic distributor of videos with a network of over 20,000 sites, 3 billion video views and 3 billion ad views. We allow publishers to present videos from the top content owners without the need for technical integration. It is a seamless feed from their original site. We can target videos to the viewer and also target ads. These videos are not user generated. They are professional videos only from top content sites such as MGM, Discovery and BBC for example. These videos can be short – 15 seconds – or longer like a telenovela. You can click on the site and see full-length videos but usually cases the content providers put on shorter videos that then lead to the longer form videos on the content owners sites.

Charlene Weisler: How do you generate audiences and discover new sites for the videos?

Oded Napchi: We reach out to people via our distribution to over 20,000 sites. It is always a big challenge to build audience so we go to content brands that don’t have enough sites and partner with them too. We tap into sites and blogs – anything that has legitimate audience such as Salon, the New York Times and the New York Post. We also love vertical niche sites because advertisers often seek something specific like political sites or sports sites for example. Interestingly, we’re finding that many are seeking Republican-centric sites but also food blogs, pet blogs. Fifty to 60% of our viewers come from the larger sites and all the rest come from smaller sites.

Charlene Weisler:  What type of data do you collect and use?

Oded Napchi:   We collect anonymous data. No cookies. We tend to work with different type of data beyond the standard age and gender that is easy to buy from third party sources such as Oracle. What we want to know is how long someone spent on the site and how they scroll through the site so you know where to place the ad. We look at super users who look at the ad and have a high engagement rate. We keep data on all of the sites.

Charlene Weisler: You don’t use cookies?

Oded Napchi: No. There are pros and cons with audience targeting. We have found that analyzing sites gave us more predictive information about users, better than using cookies. When you buy on cookies, it is often the household computer and often there are discrepancies between different providers of data. Anyone can be using it. But by entering a site, you can be more confident that it is the individual who is interested in that site content. We have had some surprises handling data in this way. An example – young Republican men in their 30s were especially interested in female mixed martial arts … and trucks. Both of those types of ads worked well on Republican sites.

Charlene Weisler:  What about fraud and viewability?

Oded Napchi: Fraud is an easy problem to fix. There has been great advancement in the past three years on fraud. We work with several very good anti-fraud companies as well as our own proprietary technologies and best practices and as a result fraud is now less than 1%. Viewability is more challenging. But you can optimize against it.

There are two newer problems worth noting here though. The first is adware fraud where some creative has malware that hijacks sites. We developed technology to completely block this behavior. We have an exchange hotline to let others know about that creative. The second is that there are a huge amount of ads that do not play because of problems that could crash the browser or block the screen. This is not intentional. Sometimes it is a tech problem. Several industry researches claim that over 50% of sites have problems presenting ads.

Charlene Weisler: What do you think the impact of Smart TVs will have on your business?

Oded Napchi: I have been thinking about this for three years and am always wrong. First I thought that app stores would rule Smart TVs but now I think Smart TV will evolve more from larger video companies such as Youtube, Netflix and Amazon as the way forward

Charlene Weisler:  What do you think the media landscape will look like 5 years from now?

Oded Napchi:  It is logical to think that traditional major media companies will merge or partner with the new digital upstarts because these newer digital companies are not really content providers and some major companies do not have major online offshoots. Comcast may be the one major traditional media company that has made this move into digital most successfully - with its acquisitions of Freewheel, Visible World and most recently StickyAds. The others may have to play catch up.

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