Already one of the first pay-TV companies to movie into addressable advertising using its advanced set-tops, AT&T (NYSE: T) will make the move into true, automated "programmatic" TV advertising.
AT&T has partnered with ad tech company Videology, with plans to introduce a "private marketplace" for programmatic TV ads on both the U-verse and DirecTV platforms, starting in the third quarter, AT&T confirmed.
Speaking to WSJ, Jason Brown, VP of national advertising sales at AT&T AdWorks touted the transparency afforded by the new AT&T offering.
"What we've heard in the marketplace [regarding other 'programmatic TV' products] is that you don't know where your ads are going to run and there is limited access to quality ad inventory. This solves for both of these things," Brown said.
The exchange will be used for linear programming on U-verse and DirecTV now. But Brown said it could expand out to platforms like the newly announced DirecTV Mobile in the future.
Through its AdWorks division, AT&T has been selling national inventory leveraging the addressable capabilities of some of its 26 million set-tops. It is now adding a layer of automation to the process, using Videology's software to issue automatic purchasing of commercial time.
So far, Dish Network (NASDAQ: DISH) is the only other pay-TV operator to launch a programmatic TV exchange.
For its part, AT&T says its exchange will target national advertising in both the upfront and scatter markets — not just the narrow slice of inventory allocated to pay-TV operators as part of their programming deals.
"What is unique about this is that we're talking about premium, reserved, upfront and scatter-based TV ad inventory," said Videology Chief Executive Scott Ferber to WSJ. "That's very different than what's been available historically. This is aimed at 99 percent of the ad money that is out there."
According to Rocket Fish, a company that works with Dish on programmatic advertising, the programatic TV market will be worth around $2 billion this year.
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