Fox Cable Plans to Enable Dynamic VOD Advertising

Nick Troiano, president, BlackArrow

Nick Troiano, president, BlackArrow

March 26, 2010 – Dynamic ad insertion in VOD has gained new momentum with an initiative underway at Fox Cable Network that marks the first step toward what needs to be done from the programming side to facilitate a viable on-demand advertising ecosystem.

Until now VOD dynamic ad insertion (DAI) trials have been initiated from the network operator side, resulting in a plethora of activities, some of which have moved from the trial stage to early commercial implementations (see March issue, p. 1). The latest trial to be announced along these lines involves the Montana systems of Bresnan Communications, which has tapped three vendors, ARRIS, Avail-TVN and BlackArrow, to create a highly automated approach to managing inventory and selecting ads in real time for placement based on factors such as context, content, location and time of day.

But for VOD DAI to go national programmers will have to begin embracing campaign management strategies that look to tap the addressable placement capabilities that are being implemented across multiple MSOs, which is precisely what Fox is gearing up to do, says Sherry Brennan, senior vice president of sales strategy and development at Fox Cable Networks. Utilizing the Sales Suite component of BlackArrow’s Advanced Advertising System on the VOD content of FX, National Geographic Channel and SPEED, Fox Cable Networks is testing the ability to deliver addressable advertising to viewers in multiple cable markets.

“Our aim with this trial is to help us better understand the value of dynamic insertion capabilities for video on demand, and to start thinking about how to design campaigns with targeting in mind,” Brennan says. “The BlackArrow system enables us to manage dynamic inventory, reliably insert and customize advertisements and promotions across multiple networks and to execute business arrangements with our distribution partners.”

The BlackArrow Sales Suite allows Fox to customize on-demand campaigns based on factors such as viewer demographics, viewing behaviors and specific content on its three networks, she notes. Essential elements include tools that leverage content information and anonymous subscriber data for audience addressability; manage business arrangements between networks and cable distributors, and modules that optimize avails.

The Fox initiative points to an eventual operations scenario where national programmers will be able to cut deals with network operators to set up campaigns in a variety of ways with an eye toward leveraging the invaluable operator data bases to support DAI placements in accord with whatever addressable criteria work for a specific programming outlet and its advertisers. “Fox is leveraging BlackArrow’s solutions to do anonymous, household-specific types of targeting across operator footprints,” says Nick Troiano, president of BlackArrow. “The ability to use that data allows them to support a more granular approach to packaging ads and building campaigns.

“The level of addressability is subject to agreement with operators and is based on the data that is passed from operators to Fox,” Troiano continues. “Our system receives that information and exposes it to Fox so they can do more targeted campaigns.”

The BlackArrow Sales Suite used by Fox supports whatever business models are arranged between the programmer and each operator or, in the case of an operator’s use of the technology, the arrangements between the operator and multiple programmers. “It governs who owns the inventory and who sells it between the programmer and multiple operators and between an operator and multiple programmers,” Troiano says.

“From a technology perspective, people refer to it as a placement opportunity information service (POIS), which is embodied in our Allocation Manager,” he explains. “So we allow, as an example, an inventory split between Fox and whatever operator they might be working with, and those inventory splits can be targeted to anything. Certain programs can have different inventory splits from other programs. FX might have a different business arrangement with the operator than SPEED. Those arrangements are reflected in the Allocation Manager to allow for efficient delivery and management of inventory across all the VOD footprints.”

The package facilitates multi-operator buys, he adds. “Fox, as an example, may have a specific advertiser who wants to advertise across all FX content as it is viewed on multiple operators’ VOD systems. So our system provides an efficient way for Fox to create a contract so that the advertiser can reach all those VOD consumers.”

This entails knowing what can and can’t be sold across all the operators that have contracted with Fox, which requires that categories specific to each operator’s definition of inventory are aggregated into a common categorization set at the Allocation Manager level. “You need to know what you can and can’t deliver to each operator,” Troiano says. “We aggregate and represent it through the Sales Suite. And on the back end we manage the delivery and track performance and confirm delivery across all the operators’ footprints.”

Deals can be structured in many different ways from one operator to the next. “If there’s an FX movie with five ad slots, Fox and an operator may have an agreement that says four of those avails go to Fox and one goes to the operator,” he explains. “When a subscriber chooses that FX movie and presses play on the set-top box, our Allocation Manager determines who has the right to sell what, and we track the ad into that seller’s experience.”

Along with the functionalities encompassed in the BlackArrow Sales Suite there are other functionalities residing on the operator side that are essential to the campaign arrangements between the programmer and operator. These processes, comprising BlackArrow’s Decision Suite and decision suites of other vendors, are designed to work in conformity with the DAI architecture defined by the Society of Cable Telecommunications Engineers 130 standard.

For example, BlackArrow’s SCTE 130-3 compliant Ad Decision Service works in conjunction with the modules embodied in the Sales Suite and other vendors’ campaign management platforms to make real-time decisions on which ads to play based on campaign criteria. Another component, the SCTE 130-6 interface compliant Request Decoration Services, provides a highly configurable means of aggregating and caching relevant content and subscriber data to support addressability.

So long as Fox or any programmer using the BlackArrow Sales Suite contracts with operators like Comcast and Bresnan that are using its Decision Suite the end-to-end VOD DAI can be implemented as soon as the terms of the deals are set up. “What we’re seeing through the Fox execution on our solution is that it’s working as intended,” Troiano says. “Technically there are no glitches.”

But, notwithstanding all the standardization work accomplished so far, things get more complicated when it comes to a programmer using one vendor’s campaign management system to interface with another vendor’s decision management system. “We don’t expect to be universally deployed across every operator, so we expect that we will be integrating with third-party decision suites,” Troiano says, noting that such integration decisions are up to operators and programmers. “Our mission and strategy is to enable multi-platform, multi-operator ad buys.”

That said, the fact that such integration processes must be undertaken to facilitate end-to-end campaigns with programmers represents a barrier to rapid emergence of a large-scale national DAI regime. “In order for the marketplace to really become a vibrant ad medium we need some sort of standardization or consistency of approaches that will allow programmers to support ad buys across all operators,” he says. “When we see that we believe programmers will want to use campaign management systems like ours to provide more efficient processes on their end.”