Interpublic Calls Advanced TV 'Balkanized,' Offers Mediocre Ad Outlook

Describing the enhanced TV industry's advertising infrastructure as "balkanized," Interpublic's top forecaster this morning released a relatively mediocre advertising outlook for the nascent medium. Enhanced TV, which is a catch-all for a variety of digitally enhanced TV advertising and viewing features, will essentially be flat this year, and will begin to post only modest gains beginning in 2010 as the cable and satellite TV industry begin to establish easy-to-manage, scalable systems for buying and managing advertising buys, predicts Magna Director of Global Forecasting Brian Wieser.

"Although industry participants are hopeful that Canoe and other inventory/infrastructure aggregators can catalyze the sector, the industry has struggled so far to establish efficient ways to buy advanced TV on a meaningful scale," writes Wieser in the new report, one of a series of updated forecasts being released this month on prospects for advertising on so-called emerging media platforms.

The irony behind advanced TV's position among those emerging platforms, is that it has been emerging for decades of fits and false starts that have kept it from gaining any meaningful traction as a national advertising medium, even as faster rising digital media platforms such as online video appear to be superseding it.



"In this environment, we expect virtually flat growth in 2009 that may lead to double digit gains as infrastructure and inventory come together through 2010, by which point we expect $168 million in total Advanced TV advertising," Wieser wrote, projecting $138 million in ad spending across an array of advanced TV platforms during 2009, a mere $1 million gain over 2008.

One of the problems, he cited, was the fact that advanced TV is really just a catch-all for disparate array of enhanced TV viewing features ranging from video-on-demand (VOD) and DVRs (digital video recorders) and interactive programming guides, as well as new advertising targeting features such as addressable advertising, creative versioning and spots that enable requests for information.

Although the cable TV industry is finally trying to develop a cohesive approach to this disparate array via is Canoe Ventures partnership, Wieser doesn't see this manifesting as an organizing principle for a material national advertising marketplace for at least several more years.

"This produces a chicken-and-egg problem of limited media investment without better infrastructure and content, but limited infrastructure and content without more media investment," he opines.

He likens the disparate nature of advanced TV to mobile advertising, which is really just an array of features and applications built around a common device, as opposed to unified, and centralized approach to an advertising marketplace.

He says the core application to date is video-on-demand, but notes that it also has its hurdles in terms of widespread adoption among advertisers and agencies.

"Unfortunately for advanced TV, VOD is similar to online video in that it can involve proactive consumer viewing of traditional TV creative assets," he concluded, adding, "Consequently, with many years spent to promote the value of VOD, but no way for it to be efficiently sold, online video has had a ready market of advertising dollars to tap into as the infrastructure and content were in place to capitalize on interest in marketing alongside novel forms of video."

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