There is a lot of talk these days about the changing TV landscape, from the advancement of programmatic to the demise of dayparts, the Upfront and even our current currency. All of this made for a lively discussion at the recent AOL Open Series on Programmatic TV. The event featured a panel of media executives from across the spectrum including Dermot McCormack, President AOL Video and Studios; Jaime Power, Senior Partner at MODI Media; Dana Hayes Jr, Group Vice President of Global Partner Development for Acxiom, and Dan Aversano, Senior Vice President, Client & Consumer Insights at Turner Broadcasting. The panel was moderated by Dan Ackerman, Senior Vice President, Programmatic TV at Adap.tv.
Programmatic TV is not what you think, Ackerman asserted. "Programmatic TV is here to stay," he said. "Sixty percent of brands will apply programmatic techniques to broadcast TV by 2016. But Programmatic TV is not RTB. It is not the way it operates in digital space. It is data aggregation and accountability."
I love panels that spark a bit of controversy and this one provided quite a few dissention points. Ackerman spoke about three areas of linear television disruption taking place today -- content, distribution and monetization. The one area that can bring a discussion to a boiling point is monetization. No one likes to have their planned and predictable bread and butter disrupted.
While Aversano believes that the time has come to transition from the current Nielsen currency, Power is not convinced. "TV is traded on broad demographics," she said. "Now we are trading on consumer behaviors which is something that we could never do before in TV. But this is just a complement on traditional TV and not a replacement."
The heated discussion took off from there:
"Nielsen is the currency," Power said. "Until someone comes up with another way to measure television we stick with the current currency. The foreseeable future is Nielsen currency."
"I don't know if you need a standardized currency," Aversano countered. "Some say that is crazy talk but who are we to say to P&G that they use a certain measurement? We have to be okay with that."
"How do you scale without standards?" Power asked.
"We have deals today that are leveraging their CRM data, Rentrak, etc." Hayes noted. "It is a nightmare but …"
"Are you set up to trade in a non-currency environment?" Ackerman asked.
"There is no way to trade at scale without a unified currency," Power insisted.
"People do it in digital today," Aversano interjected. "We need a world class revenue management system to bring supply and demand together."
"Good luck to you guys," Powers dismissed.
"I have a Switzerland response," a diplomatic Hayes offered. "You can think about digital people based targeting for TV, but there is too much money and too much risk today in TV. Smarter agencies and marketers are leveraging now for the future."
While it is not easy today for television to shift to a digital model, this shift may occur in the future as larger and larger percentages of televisions in homes are connected. So, in my opinion, it is only a matter of time before the entire TV buy/sell model transitions to something more akin to what we see in digital … and even digital may evolve. Ackerman pointed out that even today, "every network group is developing their own audience and targeting products. They are having real business impacts and we are seeing shifts of guarantees."
These shifts in guarantees underscore the real macro trends of supply and demand. "The reported TV ad impression growth is misleading," Ackerman insisted. "Forty percent of U.S. households have VOD subscriptions and there are many more programming choices. The impact is fragmentation. The core demo of TV is adults 18-49. It is the backbone of trade today but it is declining. It is not doom and gloom. It is transition. Adults 18-49 impressions are declining but ad inventory is increasing resulting in slight growth. There are more 15 second spots. So there is less content, more ads, more ad messages. There is an assault on value."
No one has a lock on how the future will pan out. But if we look objectively at the state of TV we might see that further fragmentation and higher ad loads could spell the eventual end of business as usual. At the last, Ackerman asked the panel for one prediction: What will be the biggest headline in the 2017-18 Upfront?
"Upfronts are dead," McCormack predicted.
"I disagree (that Upfronts will be dead)," Power said. "Data will be more actionable. More driven."
"Programmers that do better TV measurement will win," Hayes stated.
"Day parts are dead," Aversano asserted. "There will be new ways to structure inventory, driven by data and analytics."
It will be interesting to see who is right next year at this time.
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