October 3, 2011 – 12:09 am
OneScreen recently announced that it has been selected to develop the Wall Street Journal's presence on several major device platforms including Yahoo, Samsung, Sony, Vizio, Boxee, and others. Read the release.
TVexchanger.com: Can you explain at a high-level how apps are relevant to Television today - in particular, in how it relates to your deal with the Wall Street Journal?
AP: Viewers can now access a breadth of video-centric apps and services using Internet-connected TVs, DVD players, and set-top boxes, offering a new level of convenience and choice in accessing “over-the-top” content. Like with the personal computers and mobile devices, this presents a new method of video content consumption for end-users, and more importantly, it adds a new monetization opportunity for businesses.
What we have done with WSJ is a reflection of this. OneScreen has integrated WSJ Live into Samsung 2011 Smart TVs, Sony Internet TV, VIZIO Internet Apps HDTVs, Boxee, the Yahoo! Connected TV platform, and others. Viewers can now access video content from WSJ inside these connected devices, and WSJ has access to new premium video inventory for their audience that they can sell to advertisers. Large advertisers like Aetna, AT&T, Citi Simplicity, Cognizant, FedEx, and Fidelity, participated in the launch, proving that advertisers are equally anxious for the connected TV opportunity.
OTT apps and services, such as WSJ Live, will offer viewers greater access to content, while democratizing distribution. This new app gives WSJ the ability to distribute videos directly into the living room, the same place that CNBC, Bloomberg, and Fox Business do, giving WSJ greater reach to the audience and advertisers. Noteworthy is the fact that WSJ is not a traditional “television” brand. We expect to see other media companies not accustomed to television distribution, such as newspapers, major magazine publishers, and even brands like CPG companies, to use this medium as a viable way to reach a larger audience than ever before. This is a key milestone for the industry because a large organization like Dow Jones can now reach viewers directly on the platforms that they choose, without a channel on the cable dial.
How does this compare with what you envision for apps and TV tomorrow? When do you see the scalable opportunity hitting?
The future of Internet-connected TV apps and services will be a mixed bag. It will provide new, simpler ways for viewers to access and enjoy more content in more ways, and with the right level of competition, it will be available with the right amount of advertising and at a fair subscription price. The only problem that may arise will be if users have to navigate through 10,000 channels with very little quality or useful content within each, or if giant aggregators of content like YouTube require users to search through billions of videos.
When the bigger media brands enter the OTT market, it will help provide the ideal balance of choice, quality, and curation. This includes television companies that diversify into Internet-based video applications (TNT, Disney, etc.), as well as non-television companies that evolve their businesses (Meredith, Conde Nast, Hearst, Clear Channel). These companies already understand content publishing, integrated advertising, and the audiences, and simply need the right tools to take advantage of the growing digital video industry. This will provide for significant advertising relationships that fund higher quality content distributed through names users trust, which will be scalable in the sense of usage.
There will be another tier of apps where content creators publish their own content and monetize through ad networks as well as with some of their own ad sales. This offering will have the same type of scale as the long-tail Internet sites where there can be high volume and reach, but not as much in terms of revenue.
Do you foresee issues for media companies with the evolution in apps and television?
There will be an interesting battle that ensues, because numerous big companies are dealing with each other in many ways, and democratizing an industry doesn’t just happen overnight. Television and content distribution are very complicated businesses in terms of technology, logistics, and economics. Channel conflict – B2B and B2C – will probably be the most serious problem with both advertising and paid access.
A great example of this is the recent fallout between Netflix and Starz, which was foreseeable over a year ago. Starz is a cable television network that serves as a publisher of movies and original series which they then sub-syndicate to Netflix, which has given their subscribers the opportunity to cancel paid services and has had a dramatic effect on their revenue. Dozens of other examples exist of how new opportunities come with new challenges. HBO publishes movies to its subscribers that movie studios could just make directly available to viewers, like you’re seeing right now with EPIX (Lionsgate, MGM, Paramount) and Mirimax’s new Facebook initiative. Spotify and Vevo will soon be accessible in your living room through Internet connections provided by Comcast and Time Warner, and content owned by Sony and EMI, four giant companies that own Music Choice, a company that has provided on-demand music through television for two decades.
Ad-supported models are equally as complicated. Freemantle can now push ad-supported content directly to viewers through browsers and devices, no longer being limited to just publishers like NBC and Fox. Sprouts is an ad-supported VOD channel, while HIT Entertainment and Sesame Street Workshop, part-owners of Sprouts, syndicate content to Netflix, putting ad-supported and paid access models at odds with each other.
We certainly have a lot to work out in this industry, but it will happen with the right technical capabilities and business relationships that share common goals. OneScreen facilitates more direct connections between these stakeholders to prevent inefficiencies, giving mutual benefits to all of the parties involved. We believe syndication is critical to the future of Internet-connected apps and services, just as it has been for television for almost a century. The Internet-connected TV ecosystem is the first attempt to unify the business models, and OneScreen believes that this is the future of Television.
Do you position OneScreen as a solution for facilitating "Over The Top" content?
OneScreen has positioned itself as a solutions provider for all things video, and that includes OTT content distribution. “Over the top” requires a lot of parts. If you watch the WSJ application, you will be hard pressed to see all the pieces that it takes to create and run this type of application. There is advertising from an ad server, there are third-party content providers like Reuters and NY Post, there are multiple devices and native applications within them, and on top of this all, there are analytics. As we’ve built our technology over the past 3 years, we have looked at solving many problems across the value chain, ranging from content management to syndication to monetization, and we are able to apply all of our learning and technologies to something as complicated as “over the top” distribution.
Over the top is just one mechanism of content consumption that works in conjunction with the web browser and mobile devices. This is why we at OneScreen do not limit ourselves to one feature, one particular distribution platform, one specific niche of content, or one form of monetization. The industry is demanding comprehensive solutions that minimize cost, inefficiencies, and time to market. Our vision is to empower the media graph by connecting all stakeholders in the ecosystem through a tightly integrated solution framework. OTT is critical to us, our clients, and the ecosystem.
How do advertisers work in the app environment in TV today? Is it as complicated as other digital channels such as display?
Advertisers have a significant opportunity to help fuel innovation and fund the evolution that is underway. Brands and DR advertisers have already started to advertise through online video, and based on technologies being provided by companies like OneScreen, advertising within the app environment on TVs is that much closer. We have built technology for most devices that enables linear and non-linear video advertising using VAST and VPAID standards, something that we applied to the WSJ device application. This allows for the same robust serving, tracking, and targeting used in the browser and the same people and process used in day-to-day ad operations. There will be newer formats to support IPTV requirements, and we are on committees that help both envision and develop them. There are endless opportunities to integrate advertising between browsers, mobile phones, and connected TVs, giving advertisers a reason to be excited about the potential.
As for complexity, if you consider display complicated, then you are in for a treat with video. Look at the basics – display advertising is served through JS, IFRAME, or IMG, while video advertising is served through XML files and player plugins that have dozens of tracking pixels, multiple video files, and more. Considering other things equal – like RTB, cookies, and insertion orders – I’d say video is the most difficult, followed by mobile and then display. The online video industry is fighting this complexity through standards, consolidation, and technologies provided by companies like ours.
As with any new chance to pitch ad agencies and advertisers, there is a lot of noise, such as Internet-connected TV ad networks and mobile video ad technologies. Ultimately, to deal with the complexity of these integrations, they will need to be consolidated as features of a single platform. Large companies like DG Fast Channel, Rovi, and Google understand the traditional ways of television and are working to consolidate different forms of advertising into one process to help agencies and advertisers.
To what extent is the viewer addressable through OneScreen? Or is it all up to the ad serving tech that works within OneScreen?
You will not see OneScreen in the comScore advertising rankings and for the same reasons viewers reached by our platform are not directly addressable by OneScreen. Instead, OneScreen currently works with ad networks and exchanges, content owners, and publishers/distributors, all of whom work with agencies and advertisers. Our goal is to assist each of these stakeholders in executing their advertising campaigns. Some of our clients utilize advertising technology providers, such as DoubleClick, FreeWheel, LiveRail, and Adap.tv(with which we are already integrated), and other clients utilize our ad server and optimization tools. In some cases, OneScreen is the platform that matches custom advertising relationships with premium content and distribution outlets, giving us the opportunity to engage in branded entertainment distribution, integrated content sponsorships, and many other advanced advertising cases that are used to on television.
What's your view - is TV going to be IPTV only someday? What's needed to get it there?
TV will absolutely become IPTV. Major communications companies (Comcast, Cox, AT&T, Verizon, etc.) have a lot riding on using Internet connectivity to enhance their offerings so that they also benefit from over the top distribution. The breakthrough with IPTV will happen when the last-mile problem is solved, which is where the bottleneck will be in the short-term. Regardless of that problem, it is inevitable that Internet Protocol becomes the way all media is distributed.
Over-the-top is something different than IPTV altogether. Currently, OTT content distribution tends to describe when content is being consumed without the cable company or the device company in the monetization chain. Large communications companies have control over Internet connections and therefore will be the gatekeepers for all that over the top content. This has created network neutrality issues which will be solved with revenues being shared with them in some way – whether it is increasing prices for end-users or charging a toll for the distribution and monetization. How the device companies participate in this revenue model is shaping up slowly, and I do not expect them to stand on the sidelines. Ultimately, the concepts behind TV, IPTV, and OTT will blend and will be controlled by the same companies.
There is a lot to this transition independent of the wires and waves. Our relationships with WSJ and other clients are great signals that change has begun and that media companies are embracing the value of making TV and non-TV content available over-the-top, however, it takes time to educate the consumer and business markets, integrate technologies, and build monetization. Luckily, there are many companies marching in the same direction – from OVPs to ad exchanges to web-only content creators. The large vendors, like DG, Rovi, Neustar, and others, are serving as catalysts by acquiring technologies to help their existing customers tap newer technologies. Moore’s law seems to have implications on every technology and the TV industry cannot escape that.
By John Ebbert
October 3, 2011 – 12:09 am