Pay TV providers can benefit from user data despite ongoing policy changes. With the proper governance framework, data can be monetized, increasing the value of TV inventory. We are in the early stages of programmatic advertising with most TV ad placement being done manually. However, many are recognizing the potential in automating the buying and selling process with targeted TV ad spend growing by a 65.8 percent increase in targeted TV ads to reach $4 billion by 2019. Programmatic TV buying is expected to grow 600% from 2016 to 2018 reaching $6 billion.

The Future is Addressable Media and Proper Targeting

Pay TV providers can benefit from user data despite ongoing policy changes. With the proper governance framework, data can be monetized, increasing the value of TV inventory. We are in the early stages of programmatic advertising with most TV ad placement being done manually. However, many are recognizing the potential in automating the buying and selling process with targeted TV ad spend growing by a 65.8 percent increase in targeted TV ads to reach $4 billion by 20191. Programmatic TV buying is expected to grow 600% from 2016 to 2018 reaching $6 billion2.

Ad fatigue contributes to OTT adoption with 41% of households in the U.K. saying part of their motivation for watching on-demand services is to reduce the number of advertisements compared to traditional television. Targeted advertising is a unique opportunity to deliver ads that are more relevant to the audience and thereby preventing attrition. If pay TV providers are going to meet revenue expectations, they will have to compete with digital by properly monetizing audiences. Digital ad spend will see double-digit growth and has already surpassed TV for the first time with a spend gap nearing $10 billion. Mobile will dominate digital ad spend at 70% and is predicted to surpass TV as a standalone category by 2019.

The 600% growth in programmatic demonstrates how imperative it is to provide an opportunity for addressable advertising at scale. By serving commercials tailored to audiences instead of programs, advertisers can reach desired households regardless of what is being watched, and when it’s watched. This reality of better targeting on television will help stem the tide and change the direction of advertising dollars.

Business Isider: US Ad Spend - Programmatic TV vs. Traditional TV

Source: http://www.businessinsider.com/the-programmatic-tv-ad-explainer-forecasts-top-trends-and-barriers-to-adoption-in-the-programmatic-tv-ad-buying-space-2017-4

Data and analytics play a crucial role for content providers who are looking for ways to separate themselves with expectations of this market doubling from $1.8 billion globally in 2017 to $3.7 billion globally in 20223. We will see more Pay TV companies transforming their products and offerings based on artificial intelligence and machine learning for self-optimization.

Once all of these are combined – programmatic buying, proper targeting and data-driven products and offerings – we may see a new direction for Pay TV companies.

Media delivery is constantly evolving – how the ExpressPlay™ Suite can help

To capture audiences, relevant and timely targeting is required. By comparing broadcasters’ viewer data with our expansive data sets, ExpressPlay Audience™ helps to effectively serve and re-target viewers across devices and platforms. ExpressPlay Ads™ compliments our audience data by offering dynamic ad insertion and personalized, secure ad targeting capabilities. With client-side ad (CAI) and server-side (SSAI) ad insertion, provide your viewers with a seamless TV-like experience on mobile, browser or OTT video.

The ExpressPlay suite also offers a disruptive card-less Conditional Access System (CAS) that uses open-standard Marlin DRM to enable broadcasters and network operators to deliver content.

Intertrust How to Revive the Pay TV Market White Paper 2018

Download the white paper

Learn about:

  • Why innovation is key and how some companies have reduced subscriber loss
  • Ratings for subscription video on demand and how they prove there is room for more providers in SVOD opportunities
  • The future of addressable media and proper targeting with 600% growth in programmatic
  • Additional information on the $7 billion in piracy losses
  • And much more…

Sources:
1 http://www.adweek.com/tv-video/targeted-tv-ad-spend-will-reach-1-26-billion-this-year-up-66/#/

2 https://edelmandigital.com/wp-content/uploads/2016/12/2017-Edelman-Digital-Trends-Report.pdf
3 https://tvtechnews.eu/2017/07/21/video-services-analytics-market-to-hit-3-7bn-in-2022/