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New IPTV services coupled with Nielsen consumer and search intelligence data is set to hurt free-to-air and pay-television networks in Australia, with advertisers set to be offered consumer information that will allow them to deliver targeted marketing on the new NBN network wrapped around IPTV content.Among the organisations looking at this method of advertising delivery is Telstra for use with their Telstra TV service.
The new technology that links an IP address with a consumer allows advertising agencies to identify whether a house has a dog or a cat or how many children there are in a family. It also allows organisations to identify what devices are sitting on a home network from computers and tablets to Smartphones and IP enabled receivers or TVs to wireless enabled devices.
It will also allow vendors to sell goods direct to a consumer, for example if a consumer has an HTC Desire phone on a 24 month contract, a carrier at 22 months out can then start targeting that consumers with a new phone using TV advertising.
What is not known is whether the Federal Government will introduce legislation that controls the gathering, repackaging and trading of personal data in Australia by organisations like Google, Apple and Microsoft who are already building extensive consumer profiles on Australian consumers? These are the same organisations that are also moving to deliver IPTV content via the likes of Google and Apple TV.
Already one of Australia’s largest advertising groups, Starcom Media Vest, is testing targeted advertising. “We are finally at the tipping point,” said Laura Desmond, chief executive of Starcom Media Vest. “Advertisers’ biggest complaint so far has been that many tests of this service haven’t been big enough in terms of scale.
Currently Starcom is running tests in the USA with Direct TV who are already a 3D partner with Panasonic. The new Direct TV service targets individual homes with advertisements using third-party data providers.
Most large advertising agencies in Australia are reluctant to talk about the gathering and use of personal content data with several claiming that the role out of the NBN will see the introduction of new TV services from several providers that will deliver targeted advertising.
The National Broadband Network business plan, released yesterday, is banking heavily on a “build it and they will come” philosophy, with internet protocol television and video-on-demand expected to a key user of the network in the future.
What is currently being tested in the USA is that advertising is pre loaded onto a household’s DirecTV box and when it is time to run the ads, the box “votes” for the most appropriate commercial for that household from a spectrum of ads preloaded onto the box’s digital video recorder.
According to the Wall Street Journal DirecTV information used to target ads won’t include viewing habits. The technology DirecTV is using in its set-top boxes is from Invidi Technologies. Invidi offers a variety of targeting technologies, some of which have been used by other operators. These include targeting by age, gender or geography. Invidi makes inferences about the age and gender of the viewer based on Nielsen data on the viewership of the channels the set-top box has been tuned to.
A test conducted by cable-TV operator Comcast and Starcom last year reached 60,000 households in Baltimore showed that homes receiving targeted ads changed the channel 32% less of the time than homes that received nontargeted spots.
In 2008, Nielsen who supply a lot of consumer data in Australia to large corporations and advertising agencies started receiving second-by-second viewing data from cable-system operators in the USA recently, they then sold this data to several advertisers and media agencies.
Addressable ads will total $11.5 billion in the U.S. by 2015, according to projections from Bank of America Merrill Lynch. “We believe the U.S. television industry is finally on the cusp of transforming advanced advertising into meaningful reality,” wrote BOA analyst Jessica Reif Cohen in a note to investors”.
Tony Abbott Leader of the Federal Opposition said yesterday “It’s pretty obvious that the main usage for the NBN is going to be internet-based television, video entertainment and gaming,” the Opposition Leader said.
Plans to enable television distribution via the NBN will be among the network’s second round of product releases after it has bedded down basic high-speed broadband and telephone services starting from April.
