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Set-Top Data Finds Niches

6/14/2010 4:09 AM Eastern

While the TV world waits
on a new metric beyond traditional
ratings, cable operators
and their partners are mining set-top
box data for richer pictures of
consumers’ TV desires.

A number of logistic, cost and
privacy issues will stand in the
way of collecting the clicks from
millions of cable, satellite and
telco TV households, and turning
them into a credible source
for setting ad rates. “I used to say
all the time that set-top box data
will be the raw material for measuring
TV viewing in my lifetime,”
said Bob Ivins, Comcast Spotlight’s
vice president of data products and
research. “I’ve dropped the ‘in my
lifetime’ part.”

But the industry is finding a
growing number of uses for set-top
data, most notably as a supplemental
ad-sales tool to demonstrate a
spot’s effectiveness. The viewing
metrics can let marketers more
efficiently reach their desired audiences
and tap into the value of
“long tail” cable networks that are
not rated by Nielsen.

In addition, cable’s advanced advertising
efforts — including
Canoe Ventures’ soon-to-launch
interactive spots — will rely on aggregated
set-top box data.

Canoe’s interactive ad units,
which will allow viewers to request
more information or product
samples, are set to debut June
20 and will provide programmers
and advertisers with data
about how many people clicked
on an RFI offering. The company,
which is owned by the six biggest
U.S. MSOs, eventually plans to use
that data to provide insights such
as which programs have the highest
interaction rates and how much
frequency was required to get people
to respond, said Gerard Broussard,
Canoe’s vice president media
insights and analytics.

“What we’ll be doing with select
advertisers is not only demonstrating
the effectiveness of
the platform, but we’ll have the
first interactive reporting system
that traverses the cable industry,”
Broussard said.

Time Warner Cable, meanwhile, is
arming local sales reps with set-top
data the MSO collects internally. “It’s
the real deal. We can show advertisers
exactly where they should
be spending their money,” said
James Manchester, regional president
of network operations and
engineering for TWC’s New York
City system.

Similarly, Dish Network, AT&T
U-verse TV and Charter Communications’
Los Angeles division
are using their set-top data “to tell
a different story to their advertisers,”
said Cathy Hetzel, president
of Rentrak’s Advanced Media Information
Division, especially
with respect to networks not rated
by Nielsen.

And the opportunity to exploit
set-top data for new kinds of TV
audience research is attracting
new players — and strategic investments.

For example, Time Warner Inc.
took a stake in TV-marketing startup
Simulmedia, which aims to improve
the effectiveness of tune-in
spots using info from 15 million
set-tops. Intel recently invested $10
million in TRA, a New York startup
that cross-references TV viewing
data with frequent-shopper
information.

FourthWall Media, a developer
of interactive TV software, recently
hired Bill Feininger, previously
Nielsen’s vice president of technical
strategy and development,
who will head up its newly created
advanced-advertising research
group. “The niche we’re trying to
carve out is analytics, information
and pure data for advanced advertising,”
Feininger said.

To be sure, challenges remain.
For starters, there are no industry
standards for set-top data, and
different boxes have varying abilities
about the level of detail they’re
able to capture. But “if we waited
until all the standards were in
place, we’d never get started,” Hetzel
noted.

From an operations perspective,
the challenge is to coordinate
set-top data collection from
multiple markets, said Craig
Schwabl, Concurrent’s chief architect
for media data and advertising
solutions.

Comcast Spotlight’s Ivins acknowledged
that it is still relatively
expensive to retrieve and store
set-top data. “We’re trying to be
careful about how we do this —
we have our toe in the water,” he
said.

But he has another concern:
that tying ad rates to real TV viewing
data could potentially upset
the existing ad market, as it’s
just coming back from one of the
worst years on record, Ivins said.
“If you’re going to get more accurate
measurement on the long tail,
you’re going to have winners and
losers,” he said.

Ultimately, media buyers will
need to blend traditional ratings
information with set-top metrics
to optimize their TV spending,
said Craig Woerz, managing
partner of Media Storm, an advertising
and marketing company
based in Norwalk, Conn. But
that’s a more complicated way to
sell ad inventory .“It’s like a whole
new negotiation,” Woerz said.

Examples of how set-top metrics
are being used today:

Time Warner Cable, Charter L.A., Dish and others are providing internal set-top data as a sales tool for local ad reps
Simulmedia analyzes anonymous data from 15 million set-tops to improve the effectiveness of tune-in programming spots

TRA's 370,000-household database cross-references set-top data from TiVo and others with purchasing data from retailers' frequent- shopper cards
Canoe Ventures will track viewer response to request for information spots, set to debut in June

SOURCE: Multichannel News research

September