The future of TV advertising will probably be a lot like current state of the online advertising: aggregated advertising networks, behavioral targeting, and automated buying systems enabling small, "long-tail" advertisers to compete alongside the TV industry's biggest marketers and agencies. At least that's what a panel of TV industry executives blazing that path said Thursday during one of the final sessions of the Future TV conference in New York. "We have built technology and have an infrastructure that the industry can use to connect all those hundreds of thousands of advertisers with all the permutations that come," Mike Steib, director of Google TV Ads, said in the search giant's latest pitch to the TV industry that it can help it unlock underutilized, under-measured and undervalued advertising inventory, especially millions of local cable advertising avails that have become the ghetto of the TV advertising marketplace. By aggregating the disparate local cable advertising in ways that deliver meaningful sub-segments of viewers, Steib said Google TV ads program is able to create audience mixes that likely would have higher advertising value than their remnant avails currently have on their own, and which theoretically could compete in value with some of the TV industry's most premium network TV inventory. "There's all these opportunities to drive sell out," he said, "much, much closer to 100% and to take the CPMs up significantly when you start matching the right advertising with the right audiences." Using an example of a niche rugby sports programming channel on a local cable system that might have little value on its own to a big national advertiser, Steib said that by pooling that audience with other similar, but disparate channels on other local or satellite TV systems, Google TV Ads could effectively create an unwired network of passionate, engaged viewers that are far more relevant for some advertisers than the in-program audiences of big network TV shows. Those audiences, he said, would have value both for big national advertisers, as well as new-to-TV and "long-tail" advertisers who might be encouraged to buy the medium as a result of the easy-to-use, and efficient Google TV Ads buying system in a way that is similar to Google's online search ad buying system, Ad Words. Joan Gillman, president-media sales at Time Warner Cable, and Barry Frey, senior vice president-advanced platform sales at Cablevision, concurred with Steib's vision, though they didn't necessarily think it would be the exclusive province of Google. "Whether it's a Google, or networks performing a joint venture, there are lots of ways for that inventory to be aggregated," she said, alluding to the so-called Project Canoe initiative quietly being developed by cable operators like Time Warner and Comcast that many have dubbed the Google TV Ads "killer." "We can give the data, that measurement is there, but the actual customer data is at the operator level," Gillman said, portraying a vision for aggregated TV advertising networks that are not unlike the kind that are becoming increasingly popular in the online world, which are based more on the behavioral targeting of consumers than traditional demographic targets.
CBS Corp. on Wednesday presented its highly ambitious vision for the global music business. Anyone familiar with Last.fm, the online community of musicians and fans that CBS bought last year, already knows what that vision looks like. Trying to sell Last.fm as the biggest free, ad-supported music service online, CBS President and CEO Leslie Moonves took it upon himself to address members of the media, Madison Avenue and Wall Street. "Community clearly is the future," Moonves said from Black Rock's Studio 19. "It is clear to us that communities built around great content are increasingly driving traffic and revenue online." Through deals with Universal Music Group, Sony/BMG, Warner Music Group and EMI Group, among others, Last.fm is now offering full-length tracks and albums for a total of more than 3.5 million songs. Last.fm, which CBS acquired for $280 million last May, offers users personalized track recommendations, concert updates and music videos based on which tracks they have listened to in the past. Using its "scrobbling" technology and reference engine, the site builds user profiles tailor-made for targeting advertising. Quincy Smith, president for interactive at CBS, said he is in talks with advertisers in sectors like autos, entertainment and pharmaceutical. Toyota was mentioned specifically by Martin Stiksel, one of Last.fm's co-founders. The site's main ad spot is a mini-billboard beside the album being played at the time. What has long set Last.fm apart from rivals in the space like Pandora, MOG, and iLike has been its global reach, thriving community base and extensive relationships with major music labels--critical to avoiding rights-holder and copyright issues. A serious limitation to the service, however, is the fact that users can only play a song three times--an inadequacy that Last.fm's executives concede and hope to change. "We're not 100% happy with having only three plays," said Martin Stiksel, one of the site's co-founders. "We want more." Users do have the option to purchase tracks from one of the site's partners, including iTunes, Amazon and 7 Digital. The site also features an "Artist Royalty" arrangement, which gives unsigned acts a chance at exposure and a paycheck if users tune in. The remodeled site, which went live in the U.S., the U.K. and Germany on Wednesday, is expected to make its worldwide debut in several months.
Broadcast networks will have a hard time maintaining the premium rates being charged for advertising on TV programs distributed online, according to a group of digital media buyers and researchers. Speaking Wednesday on a panel on streaming media at the Digital Media Measurement and Pricing Summit, agency executives questioned how long networks can continue to charge CPM rates for online video three to four times higher than those for TV. "There's a point when you're going to scare advertisers away if you keep driving CPMs up in this space," warned Chris Allen, vice president and director of video innovation at Starcom USA. Panelists estimated typical online video pre-roll CPMs at $25 to $35 compared to $10 to $12 for TV commercials. "I think it's a very important time for advertisers to step up and set higher expectations of what they're asking from publishers if we're going to continue to pay that premium rate," said Molly Hop, group media director at interactive agency Critical Mass. Asked about Web video rates, Hop said she had seen CPMs as high as $65 for certain sports-related programming online. Allen acknowledged that viewer recall rates to date have been significantly higher for Web video ads than TV spots--about 60% compared to single-digit percentages. But he said that online recall rates had already fallen to 60% from 80% in the last two years, and would likely fall further. The networks "are going to have to continue to share with us the reasons why we should pay CPMs that are at a premium to what were paying in other areas," said Allen in an interview following the panel discussion. Hop also noted that where video gets distributed online doesn't make much difference from a media-buying perspective. "If I have an opportunity to spend with a network, or a [Web] portal or an ad network for my video, I'm going to go with the lowest CPM because right now I'm not really seeing a difference in how it's being branded whether I'm paying a $65 CPM or a $10 CPM," she said. Working in the networks' favor has been a relative dearth of the professional video content that advertisers are comfortable placing their brands against. But as that inventory grows, Allen believes it will be increasingly difficult for networks to maintain artificially high ad rates. The panelists said their clients were still skittish about running ads with user-generated content or venturing far beyond the standard video pre-roll format. Among alternate video ad formats emerging last year was the semi-transparent overlay, seen as a less intrusive way for marketers to reach viewers. While less expensive than pre-rolls, overlays are generating click-through rates of about 1.5%, according to Allen, who said he'd like to see them closer to 5%. In terms of video metrics, panelists said they relied on research services such as InsightExpress and Dynamic Logic to help analyze user behavior. Hop said Critical Mass tried to go beyond standard metrics like video starts and completions, to look more closely at measures of user engagement like pass-along activity. "We're taking it a step farther and not just looking at 'Did they complete the video,'" she said. Yoav Arnstein, general manager, North America, for ad technology provider Eyeblaster, agreed that advertisers are hungry for more detailed user data about Web video. Whether metrics such as average time spent watching a video or how often viewers expanded the screen, "agencies are highly interested in those numbers," he said. The more standardized such measures become, the better for developing the nascent video marketplace, he said. Agencies are also trying to get a better handle on the online video audience. Jarvis Mak, U.S. director of research and insights at Media Contacts, said the agency was conducting research with comScore to better target mainstream video consumers. Heavy video users aren't necessarily as desirable because they tend to visit niche sites with more limited reach. "So figuring out that more mainstream audience is what we're leaning toward," Mak said.
Attention Span Media is set to launch "Dorm Life," a Web-based series that chronicles the lives of 10 college students all living on the same floor. Starting the week of Feb. 4, the creative and production studio will release four episodes of "Dorm Life" at www.dorm-life.com --with new four- to-five-minute clips rolling out each week. In addition to the Webisodes, viewers will find new content posted to the Web site every weekday, including photos, character vignettes recorded via webcam, and items like thumb-tacked flyers--as the site is set up to mimic a corkboard in a college dorm. Users can also create profiles and post messages to discussion boards, as well as interact with the characters. "We included the webcam clips and social networking implementations because we wanted to build an experience that went beyond just the 20-episode show," said Brian Singleton, creative producer for Attention Span Media. "You can't just take TV content and throw it online, so we brought all of those things into the creative process from the beginning." Singleton said that the characters have presences on Facebook and MySpace, in addition to their "home" on the site. "Dorm Life" is the first major effort to come out of Los Angeles-based Attention Span Media, the brainchild of Emmy Award-winning TV and film producers Garrett Law, A.J. Lewis and Peter White. In addition to its own content, the studio's team of writers, directors and other creatives also develops content for online and mobile portals like The Huffington Post and MoGreet. Law, who serves as Attention Span Media's COO, says that the studio has also been in talks with interactive agencies for the development of content that integrates specific brand messages. The "Dorm Life" series, for example, is monetized through banner and Flash ads on the site, as well as an occasional few seconds of pre-roll video in the webcam vignettes. Still, Law said that the balance between ads and content--particularly short-form video on the Web or via phone--is a delicate one. Singleton agreed. "The target demo for 'Dorm Life' is pretty ad-savvy, so they know when people are throwing ads in their face. The most important thing is to include ads in a way that doesn't detract from the user experience," he said. The studio's next effort is for MoGreet, a mobile video messaging currently in stealth mode, which Law says will have a wider demographic and demonstrate Attention Span Media's content development range. "Mobile is an altogether different medium for production, because the medium dictates things like how you film, how you frame the characters, and the length of the clips." Law said. "You have to have the writers and directors and marketing talent to be able to pull it off successfully. And we do."
The study cost $3 million, took 18 months and encompassed 22 countries. Its conclusion--that college students account for 44% of movie industry losses due to piracy--has been the centerpiece of lobbying efforts for the last two years by the Motion Picture Association of America. There's just one problem: It's wrong. Now, with Congress poised to consider a bill forcing colleges to explore filtering copyrighted material from their networks, the MPAA has re-examined the numbers and determined that college students account for only 15% of losses. The MPAA said it discovered the mistake when preparing an update to the original report, prepared in 2005 by LEK Consulting. "We take this error very seriously and have taken strong and immediate action to both investigate the root cause of this report as well as to substantiate the accuracy of the latest report," said Seth Oster, the MPAA executive vice president for corporate communications, in a statement. Here, the mistake stemmed from calculating lost revenue as if college students would have bought tickets (OR DVDs) for all movies illegally downloaded, rather than just some of them. The MPAA said it will hire an auditor to validate the updated study. Some advocates are optimistic that the MPAA's restatement of the original study will help derail the pending Opportunity and Affordability Act of 2007 (H.R. 4137), which unanimously passed in the House Education and Labor Committee in November. The bill would require colleges receiving federal financial aid to develop a plan to explore "technology-based deterrents" to illegal downloading. "We hope that many members of Congress will now reexamine the arguments that we've been making for quite some time--that campus networks are not a major source of the problem," said Steven Worona, director of policy and networking programs of Educause, an organization for college technology departments. Advocacy group Public Knowledge, which also opposes the bill, said the new revelations should cause lawmakers to view other MPAA claims skeptically. "This was flawed from the get-go," said Gigi Sohn, president and co-founder. "It calls into question all of the MPAA's quote-unquote 'numbers.'" Sohn added that critics of the bill, including some colleges, had unsuccessfully sought more information from the MPAA about the study. "There was a lot of pressure from ... individual institutions for the MPAA to back up their numbers," she said. Opponents to the Opportunity and Affordability Act say that filtering technology is flawed, both wrongly excluding material that isn't protected by copyright laws and letting pirated material through. In addition, they argue that colleges should not be pressured into spending tuition money policing copyright.
EMI Music and mobile music company SendMe, Inc. enter into a strategic agreement today that gives SendMeMobile.com members access to EMI's full catalog of mobile content, including 4,000 new ringtones. Russell Klein, co-founder and CEO of SendMe, said the addition of EMI's catalog to SendMeMobile.com builds on the company's promise to give members "the broadest premium content out there." EMI Music's record labels include Angel, Astralwerks, Blue Note, Capitol, Capitol Nashville, EMI Classics, EMI CMG, EMI Records, EMI Televisa Music, Manhattan, Mute, Parlophone and Virgin. EMI artists that are now available at SendMeMobile.com include 30 Seconds to Mars, A Fine Frenzy, Lily Allen, Corinne Bailey Rae, Belinda, Beastie Boys, Dierks Bentley, Chemical Brothers, The B-52's, Coldplay, Daft Punk, Norah Jones, Lenny Kravitz, J. Holiday, Dean Martin, Bob Seger, Frank Sinatra, Joss Stone, The Rolling Stones, K.T. Tunstall and Keith Urban. SendMe's other content partners include Universal, Glu, Telcogames, Sony Pictures and The Orchard. Members have access to games and music. SendMe's built-in community allows members to create and share their favorites with friends and family on-the-go. "SendMe is another innovative way for us to strengthen the bond between our artists and fans," said Lauren Berkowitz, senior vice president, digital for EMI Music North America, in a statement.
The percentage of time Americans spend with print media fell to 11.9% of total media usage in 2006, according to Veronis Suhler Stevenson's Communications Industry Forecast (VSS) released August 2007. By 2011, VSS predicts print media will fall to 10.6% of all media usage. However, for many brands, advertising spend continues to be primarily dedicated to traditional media, print and television. The same report found that digital media continues to be the fastest-growing source of consumer media time, accounting for 5.3% of total media usage in 2006. Although local media outlets are going online in increasing numbers, part of the reticence brands and advertisers both have about moving dollars away from traditional media is its hold on local advertising. National and local advertisers that reach consumers through local media channels receive the benefit of building brand association locally in familiar media that carry automatic trust. What comes before SEO and SEM? For brands and advertisers embracing online advertising, strategies typically include SEO/SEM and lead generation. Fewer online advertising strategies include branding or local search and display campaigns. According to comScore's 2006 report, "Close the Loop: Understanding Search and Display Synergy," online users exposed to both the search and display advertising campaigns purchased the advertiser's products and services 244% more online and 89% more offline compared to users who were not shown the ads. Advertisers and brands whose Internet spend is largely dedicated to SEO/SEM and lead generation are surrendering significant market share. As the latest search and display numbers indicate, consumer conversion rates dramatically increase when consumers have more exposure to particular brands online. This also means that search and display do more than simply create opportunities for consumers to interact; search and display are pushing brand awareness. Without a mix of display and search advertising laying your branding framework on multiple publisher sites, especially local, brands and advertisers are undermining the effectiveness of their advertising dollars. Local Search and Display close the consumer conversion cycle Within the consumer conversion cycle exists a continuum from awareness to consideration to purchase. Ideally, brands and advertisers want to touch consumers at the awareness phase. By analyzing where Web strategies begin in this cycle, brands and advertisers can strengthen their online branding strategy and brand recognition. Brands and advertisers who begin their Web strategy with SEO/SEM face a very large gap between awareness and purchase. If you only communicate when your consumers are ready to purchase, it is likely that you are too late. What better way to develop relationships with your consumers then start with local search and display campaigns? By running search and display ads on local online television, radio, and newspaper sites brands engage consumers in the awareness phase. Ads can now be targeted by ZIP-code or DMA, and by gender, age, and household income profile. Whether their ads are running on local sports, weather, or real estate pages, brands can reach consumers in media which they use and trust more than any other. After creating brand awareness through local search and display campaigns, brands can follow up with shoppers by delivering ads in the consideration phase to consumers who have previously clicked on their ads and landing pages. With technology that tracks sites visited, links clicked, and ads responded to, advertisers and brands benefit from the insight provided by local behavioral and contextual targeting. Importantly, all of this activity happens before SEO/SEM or lead generation reaches the consumer. Local search and display brings branding to the consumer before the consumer decides to buy. Unlike traditional media, new tool sets allow brands and advertisers to change their local online ads on the fly while providing performance metrics--important factors as marketers continue to demand performance and accountability. In fact, good search and display campaigns should inform your SEO/SEM and lead generation strategies. Not long ago the interactive industry was wondering whether local media would be able to compete with Internet advertising and publishing behemoths like Google. Today's success of local online can be traced to timely, geographically relevant offers delivered to an audience that has built-in familiarity and trust with local media publishers. Technology exists today that enables national and local brands to deliver several campaigns and creative concurrently to disparate geographic markets with ease. If you haven't already begun your local media search and display strategy, there is no better time than the present to see just what kind of difference these technologies can make for you. Pate has been president and CEO of AdMission Corporation since February 2005 after leading an MBO to spin the company out of its parent IPIX Corporation. Prior to establishing AdMission, Pate served as executive officer and general manger with IPIX.