Future TV: deep data stacks competing with ads

Paul McIntyre
By Paul McIntyre | 15 July 2015

It was another sign of the times in Cannes, where the red flag of data-hungry US telco Verizon was flying high over probably one of the most expensive penthouse suites on the French Riviera at the Majestic Hotel, debating the future of television.
Verizon moved on AOL in May, acquiring its media content and tech stack for $4.4 billion. AOL is a key plank in MCN’s programmatic TV platform in Australia. Indeed, the headline act for this broadcaster panel on the French Riviera was supposed to be MCN CEO Anthony Fitzgerald, but the deal between Foxtel and Ten Network scuppered that move at the last minute, according to AOL insiders.

In this big-name global panel of TV and video players, including the US TV broadcaster NBCUniversal, Sky UK, Verizon’s US mobile and video unit, Canadian broadcaster and telco Bell Communications, and Dentsu’s Amplifi media agency out of London, there was little doubt TV trading was moving beyond TV ratings, and fast.

The consensus was that all media companies were moving to a trading model based on business outcomes, not audience delivery. The coming 12 months was a transition year where TV deals, particularly, would be partly struck on traditional TV ratings and partly on bespoke or “custom” audiences from the use of data layers rapidly being developed by many broadcasters – some faster than others. “We are going to have a mixed economy for many years to come,” Sky deputy managing director Jamie West said.

“The biggest change, which will be months, rather than years, is that no longer will media be bought in silos. TV, digital, outdoor, or whatever it might be, will be based on a single customer view. So the project we are working on with Dentsu Aegis at the moment is enabling Dentsu to frequency cap on the back of linear TV viewing. So, taking a frequency cap of four in TV and then applying that into the digital space. It’s sequential and consequential ad serving and that fundamentally changes the relationships we have. We no longer are a transactional media partner – it’s a data and technology partnership. The people who can’t prove effectiveness are going to get squeezed out. For me, programmatic is not about driving efficiency, it’s about driving marketing return or ROI for advertisers. I’m yet to hear an advertiser say to me, ‘I want you to go programmatic because I want to drive down your yield.’”

However, that view was slightly at odds with the view across the Atlantic. NBCUniversal’s chairman of advertising sales and client partnerships, Linda Yaccarino, publicly booked a time after the AOL session with Sky’s Jamie West. “I’m going to learn from you,” she quipped. “Many of my clients want to go programmatic and some do that to drive down pricing. Programmatic we see as inevitable at our company. In a world where we’re talking about the need for content marketing and contextual placement within that content, automation is an enabler to achieve that. But not only do the [advertising sales] models change to a more consolidated approach [across all media channels], the content has to change. So the creative content has to be the right content connected to the right creative on the right screen to the right person.

So a spot for Verizon is going look different on the big screen – it may change a little to inspire action on the screen on your lap and then will look completely different on your mobile device, which might be some kind of offer that will compel you to action. And it’s all data driven.” 

For a broadcaster, Yaccarino also lobbed a final and provocative curveball to the market at large. “The velocity of change in terms of how technology is forcing convergence has just stopped everybody dead in their tracks,” she said. "We have to do something and it’s actually to the benefit of our collective clients. So we, as media companies, have to deliver.
“That being said, what I urge all our clients to do, particularly in the US, is to wean themselves off commercial ratings and partner with us to promise those [business] outcomes. So leap together. The only thing holding us back is legacy habit.” 

This article first appeared within the Cannes 2015 Special Report in the July 10 issue of AdNews. Subscribe to AdNews in Print, or get it now on iPad.

Read the rest of the report:

Paul McIntyre wraps up Cannes

 

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