At the Future TV Advertising Forum in London today (Tues 3rd) Decipher calls for the creation of a new ad network to support the UK’s free-to-air TV industry. As part of our newly released report, ‘The Failure Of Future Ad Tech in the UK’ Decipher makes that case that ‘the next round of TV innovation in the UK is being held back by the failure of the UK’s free TV platforms (Freeview, Freesat and Youview) to invest in consumer data and ad tech systems. The whole UK ad-tech market is suffering as a result.’
The report is the latest wave of Decipher’s Quarterly ‘FutureMedia’ analysis and addresses the arrival of IP channels and addressability in TV. This quarter’s report makes the point that the desire of UK broadcasters to develop their own, individual ad-tech systems, while understandable given the failure of the FTA platforms to invest, is ultimately self defeating. It hampers the development of TV platforms in which they are shareholders and will ultimately hand advantage, in free-to- air advertising, to the big US agency groups and their ad-tech teams.
Decipher MD Nigel Walley says “Broadcasters can’t win an arms race against the platforms and the media agency groups. They need to pick sides, and let those two groups fight it out. If I was a broadcaster, I would be picking the TV platforms because they are inherently interested in TV. However, in the UK the broadcasters’ arms are tied by the fact that the free-to-air platforms aren’t building anything’.
The report calls for the creation of a single, unified ad network – optimised for TV – to service Freeview, Freesat and YouView in the UK, and their constituent broadcasters. The report makes the case that it should deeply integrate into each of the three platforms, and at the same time support the development of the next stage web ad-tech platforms in each of the FTA broadcasters’ web / tablet/TV players. The report recommends that it should be a ‘shared build’ across the PSBs so that it can deliver them the economies of scale needed to compete against the combined forces of the media agencies and the global web ad-tech groups.
The report makes the case that BT and TT must be treated as pay TV platforms, given their broader triple play intentions. It goes on to say that the UK’s pay TV platforms – BT, TalkTalk and Virgin – must share some of the blame given their failure to invest in TV addressability. The report makes the point that focussing on the revenue potential of SkyAdSmart is interesting but misses the key point. This is that Sky are now the only mover of note in the UK and the other platforms have effectively given up on the right to help the market define itself. This means that Sky should be in prime position to dictate the term on which addressability arrives here however, they cannot take the fight to the agency ad groups on their own. Decipher’s Nigel Walley says “The failure of the TV platforms as a group to offer the UK’s advertising community a believable, cohesive development plan is handing advantage to the media agency groups and the global web tech companies.”
The proposal for a new, unified ad-network for free-to-air TV players, includes the idea that BT and TalkTalk should be offered the chance to use the new ad network, integrated with their own CRM systems, as part of the YouView relationship. But it makes the point that, if they choose not to, them the commercial broadcast partners who have bankrolled their YouView based set top boxes, should compel them to match the innovation so that addressability is available for them to use on those platforms. For addressability in TV to take off properly, it needs to be consistently offered across all platforms.
The report also questions whether the BBC’s role at the heart of the FTA platforms is part of the problem. Decipher MD Nigel Walley says “The BBC’s role in the free to air platforms is becoming destructive. Their lack of interest in the evolution of the advertising market is blinding them to the danger of those platforms not having clear data strategies. The BBC has to step back and let the platforms, and their commercial broadcast partners, innovate around data and advertising, otherwise they will end up handing the crown jewels to Martin Sorrell.”