US smart TV maker Vizio initially appeared to secure a noteworthy leg up on rival manufacturers by signing up a series of major broadcasters to jointly develop a new addressable advertising standard for the connected TV space. It is the latest attempt by the digital TV ecosystem to replicate the advanced targeted advertising capabilities of the internet era – but how open will the newly formed Open Addressable Ready (OAR) consortium really be?
Networks from Disney, CBS, Turner, NBC and Discovery have all signed on the dotted line, alongside major ad technology units like Comcast’s Freewheel, AT&T’s Xandr and more. The group is pledging to build a technical platform for ad inventory holders, distributors or programmers to enable improved monetization of TV impressions through segment-based targeting of audiences and addressable ad insertion.
The need is clear, with station viewing figures down across the board, some by as little as 5% but up to 35% in extreme cases depending on which channels you look at, so it was about time a collaborative effort was formed. Although confusingly, the website projectoar.org says the OAR consortium was founded in 2018, so clearly the founding members have been working behind closed doors for many months now in the run up to releasing a debut product.
The OAR consortium says the protocol will be designed for use by any manufacturer of internet-connected TVs or connected devices, providing they have the ability to obtain data using Automatic Content Recognition (ACR) technology, considering the foundations of the OAR protocol will be built by Vizio subsidiary Inscape, an ACR data firm. However, the likelihood of Vizio’s chief rivals, namely Samsung, Sony and LG, following suit, remains to be seen and arguably without at least one of these foreign electronics giants on board, the OAR standard will be dead in the water in terms of reach.
Nevertheless, the consortium aims to have a full deployment ready to go in early 2020, following a debut product demo as early as Spring 2019. That opens the floor for content providers and OEMs to join in by providing specifications for the selling, targeting and measurement of TV advertising.
While flimsy in terms of technical explanation, the OAR standard aims to “define the baseline for ad delivery, impression and compliance,” according to Inscape’s SVP Jodie McAfee, who added that “networks will have plenty of room to create unique and enriched advertising experiences.”
But if any company will be keeping an eagle on eye on proceedings it will be Nielsen, having not long ago bought Gracenote, another notable player in the ACR space with technology integrated into millions of smart TVs including recent LG models. That said, the OAR consortium has not specified how the new standard’s addressable advertising will be measured, other than saying that discussions are underway as to what its measurement capabilities will entail. McAfee conceded that working with Nielsen would be a compelling option.
Of course, the rise of connected TVs and therefore a two-way pipeline has given operators and broadcasters the opportunity to dive much deeper into addressable advertising by targeting audiences not just by household but even by the size of a screen, for example.
Connected TV advertising is also moving towards digital media standards which will help boost programmatic buying against the associated inventory, with a trend towards trading on a CPM (cost per 1000 impressions) basis. To this extent, connected TV advertising is edging towards digital and away from the traditional linear TV model which focused more on audiences with limited scope for targeting even at a neighborhood or broader demographic basis. This however brings it within the realm of some of the risks associated with digital, such as ad fraud and brand contamination.
About a year ago, Inscape claimed to reach 7.7 million active TV devices and latest figures from Vizio say it has a footprint of 10.5 million smart TV sets. You don’t need us to highlight that these figures are dwarfed by the big names in TV manufacturing, even in Vizio’s native US, and as we mentioned, project OAR may have some major media names on its side already, but it desperately needs an injection of equally prominent hardware support beyond Vizio in order to be genuinely successful. Even if that means letting Nielsen have a piece of the pie.
“Project OAR aligns well with Freewheel’s objective of supporting the industry to deliver scalable, addressable advertising that will help make television an even more valuable platform for brand marketers. Bringing an addressability standard to smart TVs nicely complements solutions already available from MVPDs,” said Freewheel GM Dave Clark.
“We are making this flexible enough to enable interactivity and other bells and whistles that have yet to be imagined,” added McAfee, just about summarizing the fledgling technological state of the OAR standard.