For years now, Comcast has sought to make its extensive video-on-demand (VOD) offerings a major part of its marketing push. In April, senior vice president Marcien Jenckes blogged that the cable operator was the first to offer current hit series from the Big Four networks on its VOD platform. A month later came word Comcast was offering episodes from 600 shows, while viewing of TV series looked to be outpacing movies.
But even as free VOD content proliferated, Comcast's Jenckes echoed how wayward the industry has been at establishing a viable advertising model. With “an infrastructure that allows for new innovation and experimentation,” Jenckes wrote that Comcast is moving ahead with ... testing. The cable operator launched VOD in 2003.
One of the industry’s hurdles has been establishing a widely accepted measurement process. Rentrak has had a system on the market for some time. But, buyers and sellers still seem most eager to coalesce around Nielsen.
Now, Nielsen is floating a new approach to VOD tracking that could jumpstart the business. Nielsen is talking with clients about an “On Demand C3” metric, which it presented at its recent national client meeting. The product might ultimately carry a sleeker “ODC3” brand.
It will hardly be a cure-all since it isn’t geared to measure dynamic ad insertion and addressable initiatives that are gaining interest. But, for buyers and sellers that want something now using the C3 ratings they work with daily, ODC3 has potential to gain a notable adoption rate.
The system will produce a single rating that includes a show's live telecast along with viewing of back episodes of the same show via VOD. That could include episodes from multiple seasons.
Required is all versions must have the same commercial load -- the same ads in the same order -- embedded in the content.
The ODC3 system could track VOD viewing that takes place both on a TV platform as well as online. However, Nielsen is likely to launch it with just traditional TV.
So, take Tuesday night’s “Glee." If the commercial line-up is the same, the ODC3 number will be derived from three buckets: viewing of the live telecast; the C3 rating for time-shifted viewing (including via DVR); and a combined C3 for the older episodes made available.
(C3 is derived from average commercial ratings over a three-day period after live broadcast.)
Nielsen does not have a timetable for ODC3 launch. The system uses many of the same tools as its current C3 methodology, but the VOD world brings complications with cable, telco TV and satellite operators take different approaches. Nielsen will only be able to use numbers for ODC3 where operators make the same episodes available over the same three-day period.
If there is enough client interest, the service could become available before next summer’s upfront market, where buyers and sellers would likely cut some experimental deals.
"We are working closely with all of our clients to collectively determine a valid way to incorporate C3 ads into VOD," said Nielsen executive Brian Fuhrer. "We are early in the process, but are working hard to make it happen at the pace that makes the most sense for all parties."
The scatter market, however, is likely to be where most of the action is, partly because the depth and breadth of the available content is constantly changing. Networks might place more episodes on free VOD, or opt to cut back in order to put them behind an online pay wall. Also, cable operators are increasingly signing deals to offer more programming.
But if ODC3 gains wide advertiser acceptance, it might persuade networks to bring more content to VOD. Certainly, one group that would seem to back the ODC3 metric would be the members of the Advanced Advertising Media Project (AAMP), an industry initiative testing free VOD advertising opportunities.
Nielsen will have to ensure it can provide a breakdown on how many views come from the older episodes. That could offer insight into potential to reach consumers as they take to “marathoning,” opting to view a slew of episodes in one sitting.
Maybe thanks to Netflix's influence, so many people are moving in that direction. So, the pressing need for VOD measurement will only become more imperative. Will the industry be able to keep up?
Hats off to Nielsen. ODC3 makes sense -- and is an idea whose time has certainly come as VOD viewership grows and the industry looks for innovative ways to monetize content. To make it work, all the players in the value chain need a partner who can manage the complexity involved in turning content quickly, with the C3 watermark, and allowing for the same ad load across the assets. Avail-TVN's recently announced Advanced Advertising Insertion Marking (AAIM) removes this complexity and is available to the industry to begin realizing the revenue opportunities around ODC3 today.