Protect the Open Internet - The Future of TV Advertising depends on it

This article was published in The Asia Video Industry Report 2021

No one predicted what has happened in 2020. COVID-19 is the black swan event that permanently altered the landscape of media. It is the unexpected protagonist in the adoption of online TV streaming, moving masses of people online in one fell swoop. OTT TV Viewership soared during COVID-19 as most people stayed indoors. OTT SVOD and freemium publishers such as VIU, LINE TV, Vidio and iflix saw increases in viewership according to a four-country study (including Indonesia, Philippines, Singapore and Thailand) conducted by Media Partners Asia during 20 January to 11 April 2020. The MPA study found that the weekly number of video streaming minutes spent on mobile by aggregate consumers across the four economies spiked 60% between the two reference dates in January and April. Zee5 in India saw a surge of 80% subscriber numbers amidst COVID lockdown.

This change in consumer behaviour has one important yet less-recognized implication: it demolished the fine line dividing traditional TV broadcasters and digital publishers. TV broadcasters now must think like digital publishers in order to survive and thrive, including the key area of revenue. The industry must build strong digital advertising capabilities into their core competencies – it's no longer optional. Now is the time for the TV industry to level the playing field by investing in the building blocks of successful digital advertising: relevancy, powered by data and informed by best practices around consumer privacy.

Why now? Over the past 15 years, the TV industry hasn’t always managed paradigm shifts smoothly. New digital entrants have upended the incumbents. This is largely due to the change in content distribution technology, e.g. satellite vs internet, which alter how video advertising is bought and sold, affecting the value exchange at the heart of the TV industry.

This value exchange – where consumers watch TV advertisements in exchange for free TV - supported costly content creation and distribution methods, keeping it accessible for ordinary consumers. A similar value exchange powers the open internet as well. But if advertising is the bedrock of the free content ecosystem, then relevant ads are the cement that glues everything together. Relevant ads are critical to preserving a positive consumer experience, allowing publishers to keep investing back into the content ecosystem, including TV entertainment that generations of viewers have enjoyed.

As major tech platforms update their approach to consumer privacy and relevant advertising, there is an opportunity for the TV industry to close the gap widened by that shift from satellite to internet, by investing in new technologies to support advertising relevance and consumer privacy at the same time. And they must do it now: the third-party cookie is on the verge of being phased out. The industry needs to come together and establish a new framework for relevant advertising. This framework should be based on the principles of (1) Independence - open and interoperable standards that are not decided by few companies. (2) Trust – explaining the value exchange to consumers and the security behind the framework. (3) Openness – a set of open frameworks built in collaboration with leading industry associations and partners. 

The Trade Desk has invested in developing the technical foundations for a future without cookies, outlining a replacement that will be an open source, interoperable, decentralised – and a complete upgrade to the privacy controls for consumers. This solution, which we call Unified ID 2.0, is built for open internet and for every publisher in the industry, including TV broadcasters who have recently joined the ranks of digital publishers.

How does it work? The core of the solution is an email encryption service that converts to a unique identifier. Many TV publishers and brands today have access to email addresses from their customers. As the sources of data can vary significantly, it is essential for Unified ID 2.0 to be interoperable with the sources that exist today.

The time is now for the TV industry to invest in Unified ID to protect the value exchange that powers a TV ecosystem that is increasingly online. With more consumers watching TV online now more than ever, challenges that once affected only digital publishers now impact the TV industry as well. More and more consumers are turning in older devices in exchange for internet enabled devices, whether smart phone, tablet or smart TV. The advancement of internet technologies is a one-way street as we know it. There is no turning back.

More Information on Unified ID 2.0 here