“On television and video“is a column exploring the opportunities and challenges of advanced television and video.
Today’s column is from Paige Bilins, Vice President of Video Product Management at Magnite.
Viewers have moved much of their viewing from TV to CTV for the convenience of an on-demand experience. Advertiser dollars inevitably followed. But there is still one format that they struggled to decipher: live CTV.
In a living environment, the stakes are high. There is pressure to run campaigns smoothly for unpredictable audiences across various distribution points. In addition, traditional programming tools were not designed for television environments. Publishers naturally have concerns.
Yet the inventory of live television is highly regarded. As a result, media owners sold it exclusively through direct channels, allowing only ads from approved advertisers to run. While this resolves some concerns, it effectively limits the revenue that publishers can generate and limits the opportunities for advertisers.
In a digitally enabled live CTV environment, publishers and advertisers have more options. Here’s what it will take to get live advertising on CTV ready for prime time.
Positive and uninterrupted user experience
Live CTV viewers expect a TV experience. They don’t want to watch a “Your content will resume soon” screen while watching a sports game. But unlike video-on-demand (VOD) content, ad cuts in live programming cannot be scaled back to keep pace with demand levels.
In the case of live sporting events, the length of an advertising break may depend on the time it takes to resolve an injury. Or there could be additional advertising cuts due to overtime. Remember the third match of the 2018 World Series, which lasted 18 sleeves?
Publishers need access to a large and diverse mix of ads across categories to take advantage of those extra breaks. With a large pool to tap into, programmatic demand can be used alongside direct demand to ensure ad cuts are maximized.
Smoother flow for concurrent inventory
Abecause the content itself is variable, the live audience can also be difficult to predict. Think of the India v Pakistan match at the 2021 Cricket World Cup, which – with 167 million viewers – became the most watched game in the history of the tournament.
This unexpected increase in traffic could lead to significant timeouts that spill over into the entire ecosystem, affecting DSPs and demand partners as well.
The technologies involved in the distribution and monetization of live events must be designed to handle the complexities of this type of traffic. Content owners and distributors need to be able to control the flow of live audiences in a VOD-like way to distribute peak audiences.
Damping the number of concurrent streams would also significantly reduce the number of times systems expire, allowing for greater monetization of inventory.
With live television, there is a brief opportunity to capture audiences. And there is no way to make any changes, as most performance reports are hours or even days behind.
With CTV and OTT, performance reports need to be available a few moments after an ad runs to allow for optimization or troubleshooting before the audience disappears.
The big moment of live television
Next year, based on an estimate of viewership, 36% of Americans will watch live content through ad-supported free streaming TV (FAST) or vMVPD, according to eMarketer.
With millions of homes connected to live television via CTVs, advertisers must overcome the constraints that hold them back.