FreeWheel: Premium video views up 22% YoY

FreeWheel, a Comcast company and advertising management solution, has launched its Q2 2018 Video Monetisation Report (VMR), which shows continued growth in premium video, thanks to major events such as the FIFA World Cup, and the way broadcasters are increasingly collaborating to create a more data-enabled future for TV advertising.

In Europe, despite the arrival of new data regulations with the GDPR, premium content saw an increase of 31 per cent in ad views and 22 per cent in video views during the second quarter of the year, compared with the same period in 2017. In contrast, digital programmatic spending took a big hit immediately post-GDPR, with exchanges reporting anything between a 25 and 40 per cent reduction in demand.

‘Big screen’ viewing on TV sets captured almost a third (30 per cent) of all ad views during the period. This may be partly attributed to the screening of the World Cup over the summer – still the most watched TV event globally – as fans sought the best quality viewing experience to watch the spectacle.

Data from the VMR indicates three key trends across Europe between April and June this year:

– Premium video continued to flourish across all devices and platforms. STB and OTT saw year-over-year growth of 21 per cent and 41 per cent respectively, while mobile ad views grew by 46 per cent compared to 2017
– As streaming services continue to grow in popularity, broadcasters are reacting to the competition. Sky is building Netflix into its premium service, while others are collaborating – the BBC, ITV, Channel 4 and network operator Arqiva are joining forces to invest in the Freeview platform, to offer combined free-to-view, live and on demand television
– Direct-sold deals still dominate the market, accounting for 88 per cent of premium video ads sold in Q2 – up 41 per cent year-over-year

Additional findings from the Q2 report included:

– Operator-driven syndication grew strongly this quarter, now accounting for 17 per cent of ad views, as publishers strive to provide consumers with content whenever and wherever they want it
– Premium video continues to be an engaging format for viewers, as ad completion rates remained high in Q2, with pre-roll completion at 91 per cent for both live and full episode, and mid-roll completion rates at 94 per cent for live and 96 per cent for full episode.

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Survey: 53% don’t watch any linear TV ads

When promoting sales or products, it’s more important than ever to have an omnichannel strategy that does not rely too heavily on traditional linear TV.

This is according to a survey of 2,000 US consumers and 1,000 UK consumers, conducted by OpenX, the independent ad-tech provider.

More than half (53 per cent) of all consumers no longer watch commercials on live television. One out of four say they spend no time watching live TV at all, including 40 per cent of millennials. More than 70 per cent of millennials say they skip all TV ads.

OpenX advises that habits are shifting significantly this holiday season and brand budgets need to adapt to reach consumers where and when they are now consuming content.

As media consumption habits change, and consumers shift away from TV, mobile usage continues to increase. Some 55 per cent of consumers are on their smartphones for at least three hours a day, and more than a third of millennials and one out of four parents spend 6+ hours on their smartphones daily. Users are not just consuming content on mobile devices but they are also increasingly engaging with brands and conducting larger shares of their overall shopping via their connected mobile devices.

Almost 30 per cent of consumers surveyed say online ads help with finding gift ideas, and most say they have learned about new products through online ads. Whether it’s reaching the 40 per cent of mums playing mobile games daily, the 47 per cent of dads that are shopping on their phone in bed at least once a week, or reaching a millennial on a connected TV, it’s important to not limit the majority of advertising to one channel or screen.

Providing something of value to the consumer is often the key to success, and 77 per cent of consumers, and 84 per cent of millennials would be more likely to watch an online video ad if they could receive a discount off a holiday purchase.

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No Sex Please, We’re Apple: iPhone Giant Seeks TV Success

Tim Cook sat down more than a year ago to watch Apple Inc.’s AAPL 0.63% first scripted drama, “Vital Signs,” and was troubled by what he saw. The show, a dark, semi-biographical tale of hip hop artist Dr. Dre, featured characters doing lines of cocaine, an extended orgy in a mansion and drawn guns.

It’s too violent, Mr. Cook told Apple Music executive Jimmy Iovine, said people familiar with Apple’s entertainment plans. Apple can’t show this.

Across Hollywood and inside Apple, the show has become emblematic of the challenges faced by the technology giant as it pushes into entertainment. Apple earmarked $1 billion for Hollywood programming last year. But in the tone CEO Mr. Cook has set for it, whatever Apple produces mustn’t taint a pristine brand image that has helped the company collect 80% of the profits in the global smartphone market.

Apple’s entertainment team must walk a line few in Hollywood would consider. Since Mr. Cook spiked “Vital Signs,” Apple has made clear, say producers and agents, that it wants high-quality shows with stars and broad appeal, but it doesn’t want gratuitous sex, profanity or violence.

The result is an approach out of step with the triumphs of the video-streaming era. Other platforms, such as HBO and Inc., have made their mark in original content with edgier programming that often wins critical acclaim. Netflix Inc., which helped birth the streaming revolution, built its original-content business on “House of Cards,” a drama about an ethically bankrupt politician, and “Orange Is the New Black,” a comedic drama about a women’s prison. Both feature rough language and plenty of sex.

As a consumer-product company, Apple is especially exposed if content strikes a sour note, said Preston Beckman, a former NBC and Fox programming executive. For Netflix, the only risk is that people don’t subscribe, he said. “With Apple, you can say, ‘I’m going to punish them by not buying their phone or computer.’ ”

Apple has twice postponed the launch of its first slate of shows, moving it to March from late this year, agents and producers said. One leading producer with projects at Apple expects the date to be pushed back yet further.

Hollywood routinely humbles big companies that try to join its club. In 2014, Microsoft Corp. closed its Hollywood unit, Xbox Entertainment Studios, before it got off the ground. Coca-Cola Co. , which owned Columbia Pictures in the 1980s, found its success with “Ghostbusters” and “Stand by Me” was outweighed by expensive flops such as “Ishtar.”

Entertainment is “irrational and unpredictable,” said Peter Sealey, a consultant who led marketing for Coke’s Hollywood business. Apple excels at devices and Coke at soft drinks, he said, but “movies and TV are none of that. They’re emotional.”

Mr. Cook told analysts in July that Apple wasn’t ready to detail its Hollywood plans, but he felt “really good about what we will eventually offer.” The company didn’t make executives available for interviews for this article.

Hollywood is central to Apple’s strategy. As growth slows in the number of iPhones sold, Apple is trying to accelerate its services business, which includes the App Store, mobile payments and entertainment, including its music-subscription offering. It wants shows to support a video service on its TV app that could be bundled with subscriptions such as iCloud storage, said the people familiar with Apple’s entertainment plans.

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Global SVOD subscriptions to reach 777 million

Worldwide paying SVOD subscriptions will increase by 409 million between 2017 and 2023 to total 777 million. Eleven countries will have more than 10 million SVOD subscriptions by 2023.

China and the US will together account for more than half the world’s SVOD subscriptions by 2023. China will have the most SVOD subs from 2019 – despite multiple subscriptions being commonplace in the US. China will have 235 million SVOD subscribers by 2023 – up from 97 million in 2017.

Simon Murray, Principal Analyst at Digital TV Research, said: “The US will have 208 million SVOD subscriptions by 2023; up by an impressive 76 million on 2017 despite its relative maturity. Its share of the global market will fall from 36% in 2017 to 27% by 2023.”

By 2023, Netflix will contribute 192 million subscriptions (25% of the 777 million subscriptions), Amazon Prime Video 120 million (15%), China 235 million (30%. Neither Netflix or Amazon Prime Video operate in China) and 230 million “others” (30%). Netflix will add 82 million subs between 2017 and 2023.

Amazon Prime Video launched in 200 countries in late 2016 – like Netflix, not in China. We forecast 120 million Amazon Prime Video’s subscribers by 2023 – double the 2017 total. However, 110 million of the 2023 total will be in Amazon Prime territories, and therefore will not directly pay for the video platform.
SVOD revenues will reach $69 billion by 2023; up by nearly $44 billion since 2017. The US will remain the SVOD revenue leader by a considerable distance – adding $17 billion between 2017 and 2023 to take its total to $29 billion.

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FreeWheel: “TV advertising has never been stronger”

FreeWheel, a Comcast Company, has released its Q2 2018 Video Monetization Report (VMR), which tracks marketplace trends on premium video consumption and advertising across STB VoD, OTT, Desktop, Smartphone and Tablets.

The report found that in Q2 2018, the majority of premium, digital video ad views (57 per cent) in the US were delivered to the TV screen versus other digital devices, highlighting the increase of OTT and STB VoD advertising and reinforcing the importance of the “new living room” for advertisers. All devices, however, showed year-over-year increases in ad views, with smartphones showing the most growth (76 per cent).

The Q2 VMR highlights the increasing digital capabilities of TV and video — from the perspective of both consumer consumption and advertising capabilities — that are driving new opportunities and increased ROI for marketers. While TV has always provided high-impact reach, the proliferation of new distribution channels combines scale, with data-driven targeting and measurable attribution.

According to FreeWheel’s General Manager, David Clark, this marketing trifecta is what makes premium video uniquely positioned to grow its share of ad dollars, even in the face of competition from other data-rich, digital players.

“TV — which now includes premium video content distributed via an array of digital platforms — has never been stronger as an advertising channel. The ability to build targeted awareness with TV at the top of the funnel, then measure the impact of that exposure across devices, is now a reality,” Clark added. “The final piece of the puzzle is allowing marketers to use technology to plan and buy TV with added efficiency and automation. We’ve made some great strides in this area, and continue to work with our partners to build the next-generation, TV ad platform that meets the unique demands of the TV ecosystem.”

The growing role of automation and data-enablement in the premium video ad market is illustrated by the finding that 14 per cent of total ad views in Q2 were placed programmatically, an increase of 58 per cent year-over-year. The vast majority of these programmatic transactions were conducted via private marketplaces between buyers and sellers.

Technological advances are changing the premium video experience for consumers as well. Ad views within live programming now constitute 33 per cent of the market, despite the technological challenges posed by real-time viewing environments. Furthermore, publishers are focusing more on viewer experience by utilising technology to limit creative repetition, with only 11 per cent of creative repeated once or more within full episode player content.

Additional Q2 2018 VMR Highlights:

– Premium digital video viewing* continues double-digit YOY growth. Video views in Q2 grew by 31 per cent year-over-year, and ad views reflected an increase of 35 per cent.

– Digital viewing is not just for series bingeing. Live viewing is increasingly important for premium digital video, representing 33 per cent of all ad views, with sports content comprising 66 per cent of this total, and news comprising an additional 10 per cent.

– Consumers are going digital, but Multichannel Video Programming Distributor (MVPDs) aren’t going anywhere. Despite a downward trend in traditional subscribers, consumers watched 111 per cent more content YOY on MVPD platforms, by accessing TV Everywhere capabilities or “skinny bundle” services. 39 per cent of all premium video content is now viewed via these syndication channels (versus directly from the publishers’ platforms).

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The Media Agencies are Dying

The AdExchanger team tries to reconcile that strong language and interrogates the suspects: the encroachment of consultancies into agency territory and brands taking their programmatic media buying in-house.

Here’s the Podcast:

Have a Great Weekend (unless you work at a Media Agency)

VAB Study: Millennial Viewers Attached To TV Programming. Sure.

In another (desperate) attempt to counter the perception that young people are flocking away from TV, the Video Advertising Bureau released a new study showing that millennials are emotionally connected to TV programming and buy the products that are advertised there.

TV advertising revenue has been largely flat as media buyers watch eyeballs, particularly of young viewers, move to digital platforms and streaming services.

But the VAB found that millennials–those in the 18 to 34 age bracket–say they are connected to TV shows and their characters. And that emotional attachment is important because “someone who is highly attached is three times more likely to engage with the brand,” the report said. “They are less price sensitive, go deeper into the product line and have a higher lifetime value to an advertiser.”

The VAB commissioned Research Now to conduct the Program Engagement Survey fielded online in April 2018 with 1,000 adults surveyed. The respondents skewed slightly younger than the overall population but their TV consumption was line with the population.

The survey found that millennials feel a strong bond with TV programming. They regularly set aside time to watch their favorite programs and prioritize it as their “me time.”

Emotional connection inspires deeper program engagement among millennials, the report said. Young adult viewers are actively engaged beyond the TV airing – they share and post video clips, follow actors on social media, read recaps, and scour the web for behind-the-scenes scoop.

The survey found that the emotional connection viewers have with TV shows results in pop-culture-inspired activities, with 55% of millennial respondents using phrases from shows–like “Make It Work”– in everyday conversations, or 45% following a recipe they saw on TV to make a dish or even 43% dressing up as a TV character on Halloween.

Importantly, engagement motivates purchase.

The survey found that 43% of millennials said they purchase a product they saw on a TV show. That’s higher than the 40% of all adults that said that. Similarly, 43% of millennials said the purchases a product they saw while watching a TV–either in the program or during an ad, compared to 25% of all adults.

Another 43% of millennials said they’ve eaten at a restaurant because it or its chef was featured in a TV show.

The relationship between millennials and ad-supported TV is stronger when it comes to their favorite programs. The survey found 44% of millennials say they watch their favorite shows on broadcast or cable, topping Netflix (25%), Hulu, 12%, Amazon Prime (10%) or other streaming (8%).

Millennials don’t feel the same immediacy or sense of community around original YouTube videos as they do for TV, the survey found.

“Millennials are drawn into TV’s complex storylines, rich character development and well – known talent resulting in an unmatched emotional response,” the report said adding that millennials feel a stronger connection with TV characters and actors than to YouTube.

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Connected TV Increases Digital Video Impressions

Based on a recent global video report, video marketing platform Innovid says connected TV in 2018 is now at a 27% share of all digital video impressions to date, up from 20% in 2017 and 13% in 2016.

Mobile platforms are at a 45% share — up from 42% in 2017 and 2016. Desk digital video consumption is at 28% — down from 32% (2017) and 45% (2016).

Innovid found a 30% increase in the number of advertisers running messaging on connected TV platforms in 2016 versus 2017.

In working with 21st Century Fox’ true[X] unit on “choice-based” advertising — letting viewers choose between one interactive ad or watching multiple ads in the manner of a traditional commercial break — Innovid says the results showed strong results for marketers.

Looking at over 100 marketers that used choice-based ad units nearly 60% of viewers opted to complete “the engagement” of the ad. In addition, viewers spent more time with the ad — beyond the required time limit.

On Roku connected TV devices, the percentage was 151% higher; with Apple TV, 93%, and smart TV, 37%.

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Snapchat Gives Publishers A New Way To Make Stories – AND MONEY

Snapchat is trying something new: It’s giving publishers a way to create videos without too much heavy lifting.

On Thursday, Snapchat announced that its dozens of media partners, including Hearst, NBCUniversal, Refinery 29 and Daily Mail, will have the ability to build stories from the videos created by the app’s 188 million daily users. Snapchat will split ad revenue with the media companies from commercials that run inside the videos.

CNN is among the media companies that will use the new feature. The network had pulled out of Snapchat’s premium publisher programs last year, cancelling a show called the “Update,” which had been on Snapchat just four months before being abandoned.

Snapchat has a whole section devoted to media partners called Discover, where publishers produce shows or daily channels with articles and videos. The shows and channels, however, require big investments from the media companies and dedicated staff.

The new video creation tool requires less of a lift. Here’s how it works:

Publishers will now have access to Snapchat’s content management system, which allows them to search through the public videos uploaded daily to the app by its users. The publishers can search for certain themes or locations to build a story using the footage. For instance, there could be stories about weddings, nightlife, restaurants, all drawing from the videos people post to Snapchat. News organizations could also develop stories around breaking events.

Snapchat calls these types of videos “Our Stories” (because, well, they’re crowdsourced). Snapchat has been making “Our Stories” internally for years around special events and topics.

Snapchat wants to give more publishers and creators reasons to use the service, and a revenue-generating program always helps. Snapchat has signed up seven new media partners through “Our Stories”—Brut (France), The Infatuation, Jukin, Love Stories TV, The Tab, Wave.TV and Whalar. That’s on top of CNN and dozens of other longtime partners from its Discover section.

Earlier this year, Snapchat built a feature for publishers called “Stories Everywhere,” which opened the platform up. The media companies were able to share videos from their Snapchat accounts to their websites—a departure for the app, which didn’t generally share well with the rest of the web. Publishers will also be able to post “Our Stories” to their websites.

Snapchat declined to comment on the new program beyond the announcement it issued on Thursday. Also, CNN did not return a request for comment on its return to Snapchat.

Snapchat has been faced with adversity for much of the year, which started on the wrong foot with a poorly received redesign. It even had to redesign the redesign after public criticism, including from famous users like Kylie Jenner.

At the same time, publishers found the redesign made it tougher to stand out. More media partners were competing for the same space in the revamped Discover section.

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Google’s Android TV and YouTube loom large at IBC 2018

YouTube invading European TV screens

Google Senior Vice President Neal Mohan gave a keynote at the IBC conference on Friday. During the speech he discussed the company’s success in getting YouTube on connected TV devices:

“Thanks to our partnerships with manufacturers, broadcasters and operators like Sky and Virgin Media, YouTube is available on over half a billion certified devices globally – from smart TVs to set-top boxes and to gaming consoles.”

The investment seems to be paying off. Mr. Mohan says the television is now the fastest growing screen for YouTube. In the European Union, the time viewers spend watching YouTube on TV screens increased 45% year-over-year.

Mr. Mohan also stressed the importance of YouTube to European broadcasters:

“In 2017 alone, consumers watched the equivalent of 268,000 years of content from European Broadcasting Union (EBU) members. Broadcasters are some of the longest and most important partners for YouTube, and we’ve been helping the best broadcast moments find new life online.”

The YouTube team is leaning into the TV opportunity by making a more lean-back experience. Engineers are busy improving machine learning and recommendations to relieve viewers of the need to hunt through all the videos on the site. Instead, viewers will be able to sit back and let the app automatically play their favorite clips and shows.

However, Google isn’t only focused on having YouTube appear on the television. The company is making huge strides in running the complete pay TV experience with Android TV.

Operators are ready for Android TV

On the show floor, Google’s TV operating system is showing up all over the place. Google’s booth is right at the entrance to Hall 14, where all the new media companies show their wares. The operator tier of Android TV is, of course, a feature attraction. As well, Google ran an Android TV summit on Saturday which was one of the hottest tickets at the show. Many vendor booths throughout the RAI Convention halls also are showing Google’s pay TV operating system. Vendors like Massive, 3SS, Amino, and Accedoare showing operator solutions featuring it.

Pay TV operators have begun deploying it to their set-top boxes. For example, Com-Hem in Sweden has Android TV operator tier running on its hybrid cable/IP set-top boxes courtesy of 3SS’s solution. Amino is demonstrating the end-to-end Android TV integration it provided to Finish operator DNA Oyj on its booth.

Google has been trying to get pay TV operators to use Android TV on their set-top boxes for three years. Why do operators finally appear ready to do it? There are four main reasons:

Reason 1: The rapid growth of SVOD services

Many Europeans have embraced SVOD services as a regular part of their television diet but still, have pay TV. Operators see an opportunity to help and retain their customers by integrating SVOD into the pay TV experience. However, it’s hard to predict precisely which SVOD services their customers will use. The simplest solution is to deploy a set-top box platform with an open app store populated with many of the most popular services. Android TV operator tier delivers on this need.

Reason 2: The latest Android TV is a better platform for operators

The Android TV team has included many features operators have requested in the latest ‘P’ edition of the operator tier. For example, CEO of 3SS, Kai-Christen Borchers, described to nScreenMedia how operators could customize the search results. When a customer searches for a movie, the first viewing option shown to the user is from the operator. To see other viewing options, the subscriber must press the up-arrow on the remote.

Reason 3: Vendors are supporting it

It feels like every vendor showing operator solutions at IBC has a version that supports Android TV. For example, Accedo is showing the Android TV 1 Launcher product. Company CEO Michael Lantz showed nScreenMedia how an operator using the product could provide an entirely custom Android TV experience. The operator app starts up when the box starts, and the subscriber remains in that experience throughout.

Reason 4: It’s free

Google doesn’t charge a license fee for Android TV operator tier. It does come with conditions, like providing access to the play store and inclusion of the Google assistant. However, these are small prices to pay for such a capable operating system.

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