Big Wind For Smart TV; Second Wind For VOD

Over recent years, video-on-demand became the medium's prodigal son, despite availability in more than half the nation's cable and satellite households, and more than 20,000 titles on display in many locations. The causes: unreliable measurement of VOD usage, top broadcast and cable series not playing, and sponsor frustration with placement or insertion of their messages by operators. As VOD crosses the 60 percent of cord-connected homes, viewership on a dramatic rise from broadcast/cable show viewing and the arrival of dynamic video ad technology, speakers on a Thursday morning panel agreed that on-demand is at a tipping point. As in tipping into mainstream adoption along Madison Avenue.

CBS offered 13 of its primetime series on-demand last fall. The network launched its new season this week with 21 on-demand series. Watch out digital video recorders, on-demand viewership is gaining on you, warned David Poltrack, CBS' chief research officer. "This will be the real transformative situation in TV, and ultimately will wean people off their DVRs. It's where the majority of catch-up viewing will take place."

The combo of dynamic video advertising and set-top box data collection will force sponsors to re-explore VOD and ultimately embrace the medium for good. "In the last six months, our ability to piece the data off set-tops has dramatically improved," declared GroupM emerging communications director Mike Bologna. "We're able now to act on that data and target audiences in specific communities. You can target beyond demography."

With all that progress, and studies suggesting VOD is on track to equal or break the 40 percent jump in viewing among customers last year, Bologna recommended programmers, operators and agencies work together to improve audience measurement. "Big advertisers still have a bad taste from their VOD efforts five years ago," he said.

AMC ad sales senior vice president Marc Croc wants multichannel operators to spend more effort telling their customers about the scope of on-demand content and ease to see it. "VOD needs a press agent," he said. "The marketplace needs to generate more promotion of the platform."

First-run syndicated series continue to be off-limits for on-demand. While acknowledging the terms of TV station contracts with syndicators (such as CBS Television Distribution, which syndicates Wheel of Fortune, Jeopardy! and the just-launched Arsenio) prevent mass VOD distribution, Poltrack suggested that dictate may start chipping away. Discussions are underway at CBS to permit first-run VOD on a local station by station level.

"It would be nice to carry it all," responded Comcast senior vice president Marcien Jenckes. "We can enhance syndicated and other programming with special lead-ins and other techniques to excite viewers."

The growing universe of smart TV households, and what they can do with sets capable of offering TV networks, the Internet and original interactive applications, had their Advertising Week panel showcase Wednesday afternoon. At first, the session promoted elegant ways TBS and Showtime add interactive features to LG sets in sync with such programs as Conan and Homeland, using automated content recognition (ACR) technology. Those features include trivia, guess what's coming opinion polls, quizzes and instant ad offers, displayed via vertical or horizontal strip overlays. (Showtime's new Masters of Sex drama, starting this Sunday night, will be next with those overlays.)

"This has been so difficult to do on the TV set for years. That's all changed now," said David Preisman, Showtime's interactive TV vice president. "Smart TVs address all of the problems beautifully. We can't give out numbers, and we can tell you our numbers are off the charts. Viewers love it...and they love getting the interactive content on the TV set."

OMD Ignition director Jeff Minsky cautioned attendees that with all the possibilities smart TVs hold for advertisers, whether an ACR-driven overlay or an original brand-created app, there's major work to do before many sponsors take the plunge. Increasing the smart set household population beyond 50 percent of all homes for one; universal distribution of content and apps among smart set makers for another.

"This arena is in the lean phase, not in the mass adoption phase because the scale's not there. In the (next three-to-five) years, reaching the smart TV footprint in numerous ways will be a major priority for advertisers and agencies," Minsky added.

"And there's still a lot of emotional baggage out there from the failure of former ITV platforms," chimed Furious Minds founder Ashley Swartz. "You'll need sexy education and creative approaches to have advertisers comfortable with this arena."

Cognitive Networks, developers of the ACR process working for LG, is on a mission to get content creators and advertisers on the same page for new smart apps. "Everybody should just go create," said Cognitive chief executive Michael Collette. "This is an extremely wide-ranging opportunity with enormous long-term potential."

More observations from Advertising Week's passing parade:

Keep an eye out for Immersive Media, a company perfecting 360-degree digital cameras, resulting in IMAX-like video programming. Showing off inside Times Center Hall, Immersive has a Web site with taped scenes, a deal with Saturday Night Live for an original Web series, and plans for a smart TV service. From these eyes, the picture quality is as impressive as immersive.

Al Jazeera America hosted its first Advertising Week breakfast panel Thursday morning, bringing president Kate O'Brian and contributing correspondent Soledad O'Brien together with executives from The Huffington Post, USA Today, Buzzfeed and CBS to discuss news leadership. Side note: kudos to the Liberty Theater caterers for a nice breakfast buffet each Ad Week morning. The pulp-free pineapple juice was a great starter.