Comcast Eyes Bigger VOD Content Payoff

BUT COULD C3 AD LOADS DRIVE VIEWERS AWAY?
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Hoping to unlock more dollars for ad-supported video-on-demand TV fare and improve the measurement of “binge” viewing of time-shifted content, Comcast has hooked up with Nielsen on small technical trials that will insert C3 ad loads into the most recently aired shows as well as into previous TV season episodes.

While this Nielsen-measured approach, dubbed On Demand Commercial Ratings, would likewise look to curtail DVR adskipping, analysts and advertising industry experts wonder if ODCR’s sizable ad load, coupled with fast-forward disablement, might have the opposite effect and cause some consumers to flee to other alternatives.

From Comcast’s perspective, ODCR, which will rely on a mix of dynamic ad insertion and Nielsensanctioned measurement, has the potential to not only drive VOD usage and expand the amount of series that are off ered on its VOD platform, but also translate into stronger live TV ratings.

‘YOU’RE SELLING A SERIES’

“The idea is pretty profound because it would then mean you’re not selling an episode; you’re selling a series,” Matt Strauss, Comcast’s senior vice president and general manager, video services, told Multichannel News in an interview.

ODCR, he added, could then provide a means to monetize those older episodes that are being viewed in the C3 window (the first three days after a show originally airs) but have not typically been given C3 credit.

Based on early pilot work, Comcast believes ODCR could be ready for a commercial rollout in 2014.

Comcast, Nielsen and NBCUniversal conducted a technical trial in Philadelphia and Boston over the summer that involved three TV series: E!’s Keeping Up With the Kardashians and USA Network’s Burn Notice and Psych. Strauss stressed that the pilot was small (just 10 Nielsen employee homes) so it would not affect ratings.

Comcast said the initial trials showed that it could not only insert the C3 ad load into new and prior episodes of the series, but perhaps more importantly, that Nielsen could measure it.

Comcast, Nielsen and ABC are now conducting ODCR tests, among other next steps. CBS, which just inked an expanded VOD deal with Comcast, is considering an ODCR test run.

“We’re definitely interested” in doing an ODCR trial, David Poltrack, chief research officer of CBS, said. “With the DVR, you put the control in the hands of the consumer, but with VOD you give them the same benefi t but you’re controlling it … VOD should have always been an adsupported alternative.”

But some ad-industry and video experts don’t necessarily agree with this proposed approach.

Tim Hanlon, founder and CEO of The Vertere Group, said programmers will be tempted to replicate their live, linear ad loads into time-shifted offerings, but doing so “will be a huge mistake.” He questioned whether viewers would tolerate the 22 to 23 minutes of non-programming material that is typically packed into a 60-minute show. Programmers, he said, would be better off limiting commercials to one spot per break and perhaps charging “more for such uncluttered environments.”

VOD: NOT IN A VACUUM

Colin Dixon, chief analyst and founder of nScreenMedia, said he likes ODCR’s “single buy” ideology, because it takes some of the back-breaking elements out of the ad sales equation. But he also believes it’s challenged because cable VOD “no longer exists in a vacuum,” as consumers use DVRs (and their ad-skipping capabilities) and subscribe to over-the-top options that allow them to binge out. “If they’re planning on putting a bunch of previous seasons up for VOD and insert the ad load, boy, does that give you an incentive to check Netflix first,” Dixon said. “ But if you’re not with Netflix and experimenting with the VOD system, you’ll love this.”

Strauss said the idea of ODCR is emerging amid positive VOD trends, noting that about 40% of Comcast’s monthly set-top VOD usage involves TV-series binging.

Comcast also believes that ODCR can take advantage of the symbiotic relationship between live TV and VOD. Providing consumers with the ability to binge on a TV series using VOD can not only expand the audience for a show but also boost viewership ratings for future live linear broadcasts.

“A lot of times shows don’t pick up steam until the third or fourth episode,” Strauss said. “By moving to full season, you now have the ability for customers to catch up.”

TAKEAWAY

Comcast and Nielsen are trialing insertion of C3 ad loads into VOD content, hoping to unlock ad dollars and better measure “binge” viewing.

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