ESPN Smart to Wait For iPad Advertising to Evolve

As ESPN's service that streams live sports online was maturing, the company opted to go with little advertising. For viewers, that was a blessing -- but also a curse. For ESPN, it was smart business that's now being replicated by its move to go commercial-free with a new iPad app.

Still, as that develops, ESPN could learn from mistakes made with the early consumer experience on what's now known as, the free streaming service. With its new app for an iPad and other Apple devices, ESPN is offering three networks live as they appear on TV -- without commercials. Yet, handled improperly, a lack of ads can bring consumer backlash.

With the Apple-casts, ESPN will have loads of space to fill as the ads run on TV. It is crucial that it finds a way to turn that inventory into a magnetic user experience. To not use it as a platform for incessant promotion, yielding the type of frustration that house ads and promos generated with ESPN3 not long ago.



The Wall Street Journal said ESPN plans to run music during the breaks. Hopefully, it's not the "SportsCenter" theme. But, ESPN should come up with a more innovative tack than what happens when a caller is on hold while calling Comcast.

Regardless, ESPN's strategy to be circumspect and go without ads on the Apple-casts for now is forward-thinking and should lead to a flush revenue stream later as iPad advertising evolves.

Yet, it bears recapping both the satisfaction and suffering users of had to play through. Sure, it was a sudden gift -- a cord-cutter's delight, too. What could be better than watching the NBA playoffs, Major League Baseball and Duke vs. North Carolina on a laptop at home -- or logging in elsewhere to watch, say, the World Cup at work -- for no extra charge, beyond the broadband subscription a person would have anyway?

To be sure, "Monday Night Football" wasn't there or "SportsCenter," but greed is not good when trolling the Web for free premium content.

However, there was still a stumper, taking away from the enjoyment. Even capable of prompting someone to hurl a laptop across the room. 

ESPN3 would occasionally run ads, but mostly stuff commercial breaks with ESPN promos. On their own, these spots are some of the most entertaining ads in all of TV. Rotated ad nauseam, though, is a recipe for infuriation, making a viewer exceedingly hungry for a banal spot for Stouffer's lasagna.

Yet, ESPN apparently knew what it was doing by willing to risk the rage. By waiting for ESPN3 traffic to build - through both greater consumer interest and wider distribution --it was laying the groundwork to turn the site into a discrete ad medium. ESPN3's value to advertisers has immense potential, offering an engaged, opt-in audience that can easily be measured as far as number of visitors and time spent.

Ads are now starting to run as they would on TV. ESPN may be selling those as part of cross-platform deals, but it is better positioned to attach a standalone value for the inventory -- critical as online video continues to grow.

Now, ESPN appears to be using the same playbook for the fledgling mobile, anywhere access to ESPN, ESPN2 and ESPNU on the iPad and other Apple devices (iPhone, iPod touch). It's available so far to customers of Time Warner Cable, Bright House Networks and Verizon FiOS, who pay for the networks at home.

The iPad has the potential to revolutionize advertising across every medium. It's perspicacious for ESPN not to simply simulcast the ads on TV.

Wait until the killer app develops and then blow consumers away with the engaging, breakout experience. Advertisers will pay for the opportunity and a distinct price tag can be attached.

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