New Model Army Pushes Into TV Battleground

Programmatic schemes start to take shape among key suppliers
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Following success on the web and in digital video, “programmatic” advertising business models are starting to make a connection to the TV.

And while the idea of bringing more data and Web-style features to the world of television advertising is still being fueled by hype, there’s also substance behind the movement as trials and pilot programs emerge that will eventually pave the way to full-fledged deployments of programmatic television systems.

The definition of programmatic, however, is still open to debate. It has become a catchall term that spans everything from an electronic interchange to real-time bidding, including the ability to aggregate inventories and tap into data that can help advertisers target their ads. But execs in the programmatic TV arena appear to be coalescing on a more simplified, realistic starting point.

Programmatic “is one of the most abused terms out there,” says James Rooke, general manager, business solutions for FreeWheel, the ad tech firm acquired by Comcast earlier this year. To him, programmatic is about improving the automation between how buyers and sellers do business together and how data can play a big role in deepening the advertising intelligence of both sides. Elements such as pure automation and real-time bidding are transaction approaches and don’t necessarily belong in the programmatic discussion, Rooke says.

But no matter how one defines the term, AT&T AdWorks believes it’s already making steps toward the model, according to Mike Welch, president of the company whose Blueprint platform uses anonymous and aggregate proprietary viewership data from 15 million U-verse boxes to develop customized, data-optimized media plans. When factoring in other pay-TV partners that include Cox Communications, AT&T AdWorks’ reach is somewhere close to 55 million homes.

AT&T AdWorks, Welch says, already uses data to target its advertising and aggregate inventory across multiple publishers, making it possible to generate targeted demographics that it can match to its footprint and build a media schedule that can even be tailored for specific parts of the day.

But the system is not yet fully automated, and Welch doesn’t think it necessarily needs to be, at least not yet.

“In linear TV, that’s not as big of a deal as it is in digital. No one’s asking to do real-time buying on television,” he says, adding that his company’s platform is systematic enough that it can still have a campaign up and running in about a week.

In the meantime, he says, the platform is already reaching some goals that advertisers and their partners want out of programmatic TV systems—to create a more targeted, more efficient cost per impression.

The work underway at AT&T AdWorks is only one example of myriad programmatic-facing projects now in motion.

FreeWheel Spins Up ‘FourFronts’

FreeWheel’s programmatic TV activity centers around “FourFronts,” a platform designed to help buyers and sellers work together under the traditional principles of premium television. That means each side can negotiate for scarce, top-tier inventory while also keeping the advertiser’s third-party data used to make buys on premium programmer inventory protected. On the other end, programmers and publishers, such as multichannel video programing distributors (MVPDs) still retain critical control of their inventory.

FreeWheel calls this a “double-blind data escrow”— the advertiser data is blinded to the publisher and the publisher’s inventory is blinded to the advertiser. FreeWheel’s part is to represent the sell side of the equation that works with the media agency or directly with the brand that’s doing the advertising.

For the Four- Fronts trial, about a dozen brands are doing deals with FreeWheel’s publishing partners today, allowing premium inventory to be made available on a reserved, programmatic basis.

“We’re live and running and we’re having success doing it,” Rooke says. Disclosed participants in the U.S. trial include ABC, Discovery Communications, Adap.tv, Tube Mogul, All-state, Magna Global, Starcom MediaVest and Optimedia, among others.

AOL Platforms Takes Programmatic TV Down Under

AOL Platforms, which pitches a programmatic TV platform through its Adap. tv product, is working on a pilot program with Multi Channel Network (MCN), a media advertising company in Australia, billing it as the “media industry’s first integrated programmatic private marketplace for television.” The pilot aims to support a programmatic model across 70 subscription TV channels from Foxtel, Fox Sports, BBC, Discovery, NBCUniversal, Viacom and Sky News, among others.

For the trial, AOL Platforms is integrating Adap.tv with MCN’s Landmark trading platform in a way that will let buyers log in through an interface that shows budgets and audience targets. In turn, the Adap.tv system will create media plans based on that information and push orders through to the Landmark traffic and billing systems. One aim is to help advertisers track their ad campaigns and optimize them on the fly.

The effort represents a “good prototype for what we can do here in the U.S.,” says Dan Ackerman, head of programmatic TV at AOL Platforms. He says integration is underway now ahead of the launch of the trial in the first quarter of 2015.

Canoe Steers Toward Programmatic Modeling

Canoe, the cable operator-backed advanced advertising joint venture, has also begun to bring programmatic-facing elements to its dynamic ad insertion platform for set-top-based video-on-demand, starting with interconnections with its programmer partners.

Canoe, which uses BlackArrow’s campaign management system in addition to platforms from Ericsson and SeaChange International to link up with its MSO partners, has already established “northbound” electronic links with programmers that use products from FreeWheel and Google DFP (DoubleClick for Publishers), according to Chris Pizzurro, Canoe head of product, sales and marketing. Canoe has additional electronic integrations underway with other systems that aren’t yet complete.

Viewing this as a “first stage” toward more programmatic-based models, Pizzurro says programmers can input their campaigns into their own campaign management systems and have those instructions passed along to Canoe’s platform. This eliminates those programmers from having to re-key their campaigns across different systems.

“That’s the stage we’re at, for efficiency’s sake. Where this goes three to four years from now, I don’t know. But for now, we’ll evolve the platform the way our programming partners want us to,” Pizzurro says. “If they want to move beyond the interconnect and figure out how our systems plug into agency systems directly…then we’ll explore doing that in partnership with our programming partners.”

Interest in the programmatic TV models are also factoring into some recent M&A activity. It was one of the drivers behind Imagine Communications’ recent acquisition of OpenTV’s advanced advertising assets from the Kudelski Group. Those assets will be used to flesh out Imagine’s next-generation, cross-platform efforts, which will support automated, programmatic ad business models, according to Glenn LeBrun, Imagine’s VP of product marketing.

While these examples represent only a snapshot of what’s happening on the emerging programmatic TV front, execs in the industry see more tests and pilots on the horizon.

“It’s a big shift in the industry,” Ackerman of AOL Platforms says. “I don’t blame anybody for being cautiously optimistic.”

“The market is starting to embrace it,” Welch says of the programmatic TV model. “It is shifting to the way TV will be bought and sold, vs. some niche.”

Related: Programmatic Ad Tech Players on the Grid

Related: TV Seeks Private End of Programmatic Pool

Following success on the web and in digital video, “programmatic” advertising business models are starting to make a connection to the TV.

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