• by Wayne Friedman , November 17, 2006

Verizon FiOS TV's' first-ever advertising executive says the all-fiber TV system's messaging business will kick off in conventional local TV ways, but hopefully will end up more revolutionary once the system builds critical mass.

"We'll create a traditional local cable [ad] business," says Jason Malamud, vice president and general manager of Verizon FiOS Media, who comes to the company from MTV networks as vice president, affiliate ad sales and marketing. "We are building insertion equipment, and we'll be outsourcing to third parties for sales, billing and other activities. We'll have that ability starting next year."

FiOS TV's 118,000 subscribers are scattered in small suburban markets like Tyler, Texas. Its goal is to get to 3 million to 4 million by 2010. But for advertisers, traditional local-cable advertising is only a small, initial piece of the promise. FiOS TV's high-tech, all-fiber TV system also offers modern IP capability, with two streams that can deliver true interactivity.

"We have much more bandwidth than [traditional] cable systems," he says. "We can distribute more versions of advertising spots. We are not bandwidth-constrained."

The Verizon FiOS TV is "a true two-way system, and opens up opportunities for advertisers," he says. For example, it can super-target consumers or allow them to have instant feedback regarding advertisers' creative efforts. "For us to make our mark, a spot on the FiOS TV is going to have to work harder than on TV in general."

The IP special piece of the Verizon FiOS TV system will place advertisers into a different TV world. "I liken it to the direct-mail business," says Malamud. "It should be able to make TV more relevant and should incentive-ize consumers."

Malamud is also attentive to Verizon's other businesses: its bigger mobile-communications side and its V Cast entertainment initiatives, as well as other digital outlets.

"I have yet to personally connect with the [mobile] side of the business," he says. "But there is an expectation for multi-screen applications. We are working together on video on demand and broadband video. A pre-roll ad is similar on VOD to one on broadband. It would be silly to create silo-ed systems that don't interconnect."

Verizon has more than 6.6 million broadband customers, which includes subscribers to its all-fiber FiOS Internet Service in 16 states and Verizon Online DSL subscribers in 27 states. Verizon is targeting from 6 million to 7 million FiOS Internet customers by 2010.

The company's goal is to pass 18 million homes with its fiber network by the end of 2010.