Video On Demand Advertising : Why this is the year ....

VOD advertising has been coming of age for many years. Interestingly enough the deployment of VOD advertising outside of the US is greater and picking up steam.




I had the privilege of being on a VOD Advertising panel this week. Here are the write-ups that were done by the media on the panel

Advanced Advertising: VoD Advertising panel Multichannel news
Broadcasting cable Advanced Ad Deployments accelerate


The diagram above shows the key factors that are increasing the velocity of adoption of VOD advertising adoption across all devices. 

1. Catchup TV demand is increasing for premium video assets. This has been seen by the quick rise in Hulu as well as Netflix in the OTT space. Almost every content distributor either has strategies in place or is working on putting in a strategy to capitalize on this wave of consumer demand.
2. Multiscreen video ( non TV delivery of premium video assets ) is exploding. My forecast for the evolution of the Multiscreen video advertising can be found here Multi screen Adertising evolution
3. Dynamic ad insertion continues to gain more and more traction in the market. My article on this subject can be found here Dynamic Ad Insertion and Scheduled ads
4. Internet Video advertising is growing. There is a wealth of data out there documenting this trend that I have tweeeted in the past
5. Content distributors are looking to monetize the investments that they have made in MSV platforms.

The real game changer has been the arrival of the non TV devices. Three years ago there was no Iphone, Two years ago there was no Android. Two years ago there was no Ipad. And the adoption of all these devices particularly as they are true IP/internet devices is opening up many new and interesting areas.
In this new space advertising is one of the areas of growth and video advertising,  as a rising star in the Internet advertising space is amplifying the effect for VOD advertising adoption.

Challenges that are overcome/near overcome
Here are issues that have been blocking factors in the past but ones that I believe have been largely overcome at  this point:

1. Technological barriers. Systems to do the ad placement and standards There are now multiple options that can provide VOD advertising. The SCTE 130 standards are making interoperability feasible. In addition the IAB VAST VPAID standards from the Internet side of the house provide even more flexibility. If you are interested in a background on these standards SCTE 130 and IAB primer and a comparison in capabilities SCTE 130 and IAB/VAST differences
2.  MSV with its different formats added more complexity to these issues. Between the standards and product offerings that are there on the market this is no longer a major issue.
3. Infrastructure for the VOD enabling Set Top Box deployments in the cable and telco environment . VOD is now offered by most content distributors. However the key here will not be the traditional cable footprint, but the IP enabled footprint. This has been going up in leaps and bounds and almost everyone of the content distributors offers internet connectivity to the home in the cable and telco space.
4. The mobile players are already upgrading to 4G networks where the bandwidth becomes available with the deployment.

What challenges remain
 Here are the issues that are the largest barriers to adoption:

1.  Non traditional ad units. Dynamic ad insertion (Dyanmic Ad Insertion and Scheduled ads) is by definition different from schedule based ad insertion. Tracking and reporting on the ad information is also different. As was pointed out on the panel information sharing to create overall metrics is not in place yet. There is a lot of progress here and I think that we are at the cusp of completing and communicating the chain from advertiser to content distributor 
2. Content rights for VOD and catchup TV on all platforms. This is a work in progress but all content distributors are working on this at this stage.

Overall analysis.

1. There are new drivers that have changed the game and increased the impetus for VOD advertising. Standards are in place to leverage the potential.
2. Many of the problems that have existed for years have been solved or near resolution. Rather than technical issues the major challenges that remain are content rights and non traditional units

YES there are challenges that remain,  BUT there is a also heck of a lot of opportunity there for the taking. This is the year ....