Advanced Ad Deals Lag Behind Technology

Many key business models for platforms remain fluid 2/20/2012 12:01:00 AM Eastern

While Deployments of advanced
advertising technologies have become
more widespread, one of the key factors
holding back these platforms remains the lack
of agreement on key business models.

For starters, a number of
programmers still need to ink
deals with operators detailing
how the revenue and ad avails
might be split up. As a result,
the number of networks participating
in initial deployments
of dynamic VOD or interactive
advertising platforms
remains relatively limited.

Currently, NBC Universal
networks USA, E!, Syfy, Bravo
and Oxygen, as well as some
niche and local content providers, are participating
in Comcast’s dynamic VOD insertion deployments.

“We have a lot of programming deals that
were cut a long time before VOD advertising
came into its own. To achieve scale, we have to
go back and engage with programmers to account
for the fact that advertising is a possibility,”
says Marcien Jenckes, Comcast senior VP/
general manager of video services.

Likewise, Canoe Ventures has eight networks
currently participating in its request for information
(RFI) interactive ad products. Canoe, which
is owned by six major MSOs, expects several
more networks to be added soon.

Programmers also continue to experiment
with different ad loads and approaches. For example,
the fast-forward button is disabled on
Comcast’s VOD platform for ABC, Fox and NBC
programming, but not for CBS.

The right ad loads for VOD are another question
mark. A number of programmers are using
the same ad load as their linear feeds so the viewing
is counted as part of Nielsen’s C3 ratings. But
others have adopted a lighter ad load, and there
are a variety of approaches to the load after the first seven days of airing on the VOD platform.

Comcast has, however, been
able to us its dynamic VOD ad
insertion platform from Black-
Arrow to offer programmers
several options for ad insertion.
“Our system allows network to
insert whatever ads will best
monetize the content at that
point in time,” says Jenckes.

Early research into both
dynamic insertion of VOD
ads and interactive ads is also
showing their effectiveness,
brand awareness, ad recall and purchasing intent.

“For advertisers looking for a return on their
investment, it produces measurable results,” says
Arthur Orduna, chief product officer at Canoe.

But Comcast has been exploring the creation
of additional measurement tools. “We think it
is important to create an audience currency,”
Jenckes says.