Addressable ad executive: ‘If I knew it would only be a $2B business by 2018, I wouldn’t have taken the job’

AT&T's addressable advertising business (AT&T)
Addressable ads make up a tiny fraction of the $70 billion U.S. TV advertising market. (AT&T)

SAN FRANCISCO —While most agreed that the technology is baked enough to support sizable addressable advertising and Dynamic Ad Insertion (DAI) markets in the U.S., a panel of leading industry experts also concurred that the current market, as it exists, is disappointingly small.

In fact, various estimates peg the total U.S. addressable market at only around $2 billion right now—a small fraction of the $70 billion U.S. TV ad market. 

“If you told me in 2003 that I’d be talking about a $2 billion business today, I wouldn’t have taken the job,” remarked Michael Kubin, executive VP of media for addressable services shop INVIDI. Speaking at the annual TV of Tomorrow conference on the old Presidio lot on Thursday, Kubin has been on the job since, well, 2003.

Sponsored by Dell Technologies

Whitepaper: How to Elevate Your Content Delivery Workflows With Dell EMC PowerScale

Learn how Dell EMC PowerScale helps meet surging viewer demand while reducing costs with a single centralized platform for the ingest, processing, and delivery of the content your viewers love.

“For some reason, the media business takes forever to adopt new technologies and standards,” Kubin shrugged. 

First and foremost, the panel noted, programming networks are loath to give up inventory measured by Nielsen’s coin of the realm, the C3 rating. 

“One of the biggest hindrances to addressable is that national TV is completely tethered to their Nielsen ratings,” noted Peter Dolchin, head of telco and video distributor partnerships at Google. 

Nielsen currently doesn’t measure addressable ad delivery, a dynamic Kubin and several other executives said they’re working with the research company to change. 

Meanwhile, Jarred Wilchinsky, VP of video monetization and operations for CBS Interactive, noted that programmers and their advertising partners are still concerned about their ability to manage commercial pods.

“There are still massive technical issues to work out,” Wilchinsky said. Networks work carefully to manage pods—to make sure they’re the right time length, and also not “to put a Toyota spot next to a Ford commercial.”

‘The complexity of keeping a clean pod,” Wilchinsky said, still can’t be managed yet on an automated level. 

Wolchinsky also suggested that not every advertiser needs addressable. His example: makers of toilet paper, whose ads target everybody. 

Suggested Articles

WarnerMedia scored a key HBO Max distribution deal with Comcast just as it launched in May. Nearly six months later, there still isn’t an app.

Peacock, NBCUniversal’s recently launched streaming video service, is rolling out 20% discounts on annual Premium subscriptions for Black Friday.

How can we defend ourselves? Mostly, it’s a matter of common sense.