Connected TV Makers Innovate Widely to Accelerate OTT Push

Richard Bullwinkle, chief evangelist, Rovi

Richard Bullwinkle, chief evangelist, Rovi

February 3, 2012 – A foundation is now in place for the smart TV to become a real driver to next-generation consumer experience with enhancements that overcome many of the drawbacks of early efforts in this domain.
 
CE manufacturers are launching advanced navigational and advertising capabilities which, along with more content and app options, have transformed the picture of what constitutes a smart TV strategy compared to what suppliers had on offer a year ago. Just how far things have come across multiple manufacturing platforms was especially evident at CES in the Caesar Palace suites occupied by Rovi, which has been at the center of many of the evolving smart TV strategies.

The vendor has combined a wide range of in-house technology innovations, acquisitions of companies like Sonic and DivX and its position as keeper of metadata for virtually every TV show since the dawn of television to seed the market with capabilities that are changing the business models for smart TVs. For example, the long-awaited emergence of the smart TV as an advertising opportunity for OTT video has begun, thanks in part to CE adoption of the platform on offer from Rovi.

“We evolve continuously,” says Richard Bullwinkle, who has the title of chief evangelist for Rovi. “The thing I’m getting comfortable with now is that we’re also an advertising company.”

The Rovi Advertising Network and underlying services and technologies are designed to provide manufacturers who deploy Rovi’s TotalGuide navigation system an opportunity to monetize that point of consumer engagement with placements from Rovi ad network clients, now including many top agencies and individual product suppliers such as Ford, Lincoln and Toyota. The Rovi ad platform is running on Sony, Samsung, Panasonic and Toshiba devices as well as cable set-tops and other points of user interface, Bullwinkle says.

“Our ad network is now on over 45 million connected devices, not counting cable set-tops,” he comments. “With cable the total is 130 million.”

These are early days for the ad platform, Bullwinkle acknowledges, but the pace of signups and initial surveys into how the ads are performing point to a big growth opportunity. “We have the potential to support hundreds of advertisers generating big revenue streams,” he says, noting that the strategy generates the advertising residuals CE makers have long said would be part of their recurring revenue strategies.

By employing banners in the guide navigation field with interactive capabilities, including support for requests for information, targeting and telescoping the Rovi Ad Network engages consumers outside the flow of in-program advertising without the clutter of Web-style banner advertising, Bullwinkle notes. In the case of Ford ads, for example, by clicking on a banner on the guide, viewers are transported to an interactive TV viewing experience where they are able to view photos, play videos and dive deeper to learn more about the Ford-450 Super Duty truck, Focus, and the Lincoln MKX and MKZ.

An expansion of Rovi’s advertising deal with Samsung points to what lies ahead in this space. The companies say they plan to deliver a range of new capabilities designed to drive greater engagement and measurement, as well as new ad placement opportunities including in-app advertising.

“The launch of our Samsung AdHub, supported by Rovi’s strong relationships with agencies and brands, will create new opportunities for marketers to broaden their reach and take advertising to a new level of consumer engagement,” says Daniel Park, vice president of Samsung Electronics’ Media Solution Center. Possible new options for advertisers include RFI capabilities that support click to call, email, and quick response (QR) codes within advertisements as well as social networking options and additional TV commerce capabilities, Park says.

Results from last year’s Smart TV Field Trials in the U.S. and U.K. are very encouraging, notes Jeff Siegel, senior vice president of worldwide advertising for Rovi. “Eighty percent of respondents to our recent Smart TV study indicated they noticed the presence of ads, and a third of those chose to click on them,” Siegel says. “We believe the initial data demonstrates the potential of this platform as a new media channel, which consumers are adopting more quickly than many had anticipated.”

The metrics feedback loop Rovi’s ad services provide is a strong incentive to advertisers in this space, Bullwinkle adds. “We know what shows you watch and what you fast forward through, so we can help advertisers tailor ads for more effective performance,” he says.

The ability to sell content at the point of user navigation is a strong inducement for advertising participation by retailers and content originators, he adds. “Everybody wants a storefront in the home,” he notes.

Beyond the advertising support associated with digital storefronts Rovi is also fueling the connected-device ecosystem by providing smart TV customers access to content supplied through its Rovi Entertainment Store affiliates, such as Best Buy with its library of CinemaNow content.

Rovi Entertainment Store, an end-to-end, white-label solution for OTT storefront creation and management, currently supports nearly a dozen third-party services on a broad ecosystem of connected devices. Officials say the platform offers software development kits that allow customers to quickly define, deploy and update differentiated digital entertainment services that are distinctly their own. And it includes support for hosting Hollywood studios’ UltraViolet digital locker application for accessing cloud-stored titles purchased by consumers.

Rovi has also firmed up the link between the entertainment store and the connected device ecosystem through support for content distribution over its latest iteration of DivX technology, DivX Plus Streaming. With content protection endorsed by five studios, DivX Plus handles adaptive rate fragmenting and other formatting requirements for connected TVs, Blu-ray players, Apple iOS and Android devices and PlayStation and Xbox game consoles, Bullwinkle says. The Blu-ray-like experience offered through DivX Plus also includes support for subtitles, multiple language tracks, and trick-play functions such as smooth fast forward and rewind, he adds.

Noting Rovi has also introduced Digital Copy Solution (see p. 8), which allows consumers to register existing DVD content for access through the UltraViolet cloud, Bullwinkle says Entertainment Store customers can support distribution of UV content using the UV file format or DivX Plus. “We don’t care,” he says. Storefronts as well as smart TV app developers can avail themselves of Rovi Cloud Services APIs to gain real-time access to metadata, recommendations, search and other functionalities for their applications.

Anchoring this growing ecosystem of enhancements to consumer experience and monetization on smart TVs is the Rovi TotalGuide, which it has upgraded with its G2 release to afford CE manufacturers greater flexibility to customize the user experience in ways that differentiate their UIs from others. “Easy customization is huge,” Bullwinkle says, noting this less monolithic version of TotalGuide also allows customers to mix different features from different vendors.

“Most of our manufacturers build their navigation systems and apps using us and competitors, so they license different parts from us to run on their processors,” he says. “Some want to use our metadata and guide; some just want to use our ad network; others want to use our recommendation engine. Toshiba is the only one that is using the full package of features.”

Other important new features include use of social media commentary to enhance entertainment discovery and deep integration with portable devices. “All the hooks are there to enable use of these devices as remote controls for navigating on connected TVs,” Bullwinkle says. “And it includes TotalGuide XD, which is the portable version of TotalGuide.”

The growing Rovi ecosystem also includes support for automatic content recognition through the vendor’s affiliation with Audible Magic. As reported elsewhere (p. 27), the two firms have teamed on a means by which mainstream broadcast programming can be readily identified and synched up with companion device apps through use of the Rovi metadata library.