AT&T CEO Randall Stephenson said now that the Time Warner deal is done, AT&T is on track to launch a real-time ad exchange platform within 24 months.
Stephenson said that AT&T’s targeted ad exchange platform will differentiate from digital platforms like Facebook and Google by offering marketers the chance to place their brands next to premium content. He said that building the platform will require some ad tech M&A but promised it would be smaller deals.
Though it will take some time and investment before AT&T’s exchange is ready to roll, Stephenson said that AT&T will see benefit right away by being able to manually sell Turner’s inventory paired with AT&T’s consumer data. He added that AT&T’s ad sales plan could result in higher yields which in turn could allow AT&T and Turner to reduce ad loads.
Stephenson said that AT&T is currently selling its ad inventory into a traditional linear business that’s declining but that its ad business, currently worth around $1.8 billion, is clocking double-digit growth annually. He said AT&T is achieving that growth with all of the data and customer insights it’s able to glean from its distribution businesses.
“We take that data into the marketplace and sell our inventory with that information,” said Stephenson. “It’s important to note we do this with brute force. It’s not automated. We don’t have real-time exchanges. We’re literally selling this by brute force, growing double digits and as we get into the political cycle, this thing is picking up steam.”
Stephenson said AT&T’s ad business will gain more momentum now that it can sell Turner’s ad inventory, which he said is 3 times what AT&T had before the merger. He said AT&T is “very convinced” that other media companies will be interested in selling their ad inventory on AT&T’s exchange.
Stephenson outlined some ways that AT&T can use its networks to present advertising in different ways. He said AT&T can serve short, targeted ads on the television when it knows viewers have a smartphone in their pocket, and allow them to further engage with the marketing while not interrupting the programming on the big screen.
“These are the kind of things that are going to be worked aggressively to change the advertising business, not just to try and create additional yields,” Stephenson said.