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CEO Stephenson: AT&T Will Acquire More Companies ‘In The Coming Weeks’ To Support Ad Unit
AT&T, which closed its acquisition of Time Warner on Thursday, will acquire more companies to support its Advertising and Analytics unit, CEO Randall Stephenson said Friday during a CNBC interview. Watch it here. Stephenson spoke of an upcoming ad-supported skinny bundle called AT&T Watch TV, featuring Turner content, that will be formally announced next week.… Continue reading »
The post CEO Stephenson: AT&T Will Acquire More Companies ‘In The Coming Weeks’ To Support Ad Unit appeared first on AdExchanger.
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With Time Warner deal approved, AT&T can focus on addressable TV ambitions
More than a year and a half after AT&T announced its plan to merge with Time Warner, the marriage has been finally approved by a federal judge. However, AT&T will still need to get advertisers’ approval to realize the newly combined company’s addressable TV advertising ambitions.
The addressable TV ad market in the U.S. has grown since 2016 when the AT&T-Time Warner merger was originally announced, but it remains a relative drop in the bucket compared to traditional TV. This year, advertisers are projected to spend $69.87 billion on TV advertising in the U.S., and $2.25 billion, or roughly 3 percent, of that money is expected to go to addressable TV ads, according to estimates from eMarketer.
Some of the addressable TV market’s relatively small size can be attributed to the relatively few opportunities to target ads on TV. The cable and satellite TV providers, like AT&T’s DirecTV, Comcast and Cablevision, can target ads based on the data they have on their subscribers, but they are typically only allotted two minutes’ worth of ads per hour of television on each network.
Advertisers also need to cobble together a target audience across various TV providers to reach a large enough audience, a process complicated by the providers having different methodologies for compiling their audience segments, said an ad tech executive, speaking anonymously. Different providers also measure campaign performance in different ways. That problem may be familiar to marketers used to advertising on Facebook, YouTube, Twitter and Snapchat, but it’s more alien to TV advertisers accustomed to Nielsen’s measurements.
“You’re still not looking at a single [addressable] buy that gives you any type of national coverage,” said Jeff Ratner, iCrossing chief media officer.
Advertisers also don’t appear that interested in narrowing their TV campaigns as much as they might pinpoint their ads online. The most common targeting options that advertisers use for addressable TV campaigns are age, gender and designated market area (a loose geographic grouping that typically includes multiple cities into one market), according to Randy Cooke, vp of enterprise solutions at SpotX.
AT&T could address some of those issues in short order. For example, advertisers may be limiting their targeting because their reach is already restricted by the limited amount of inventory available for targeting and because it’s easier than stitching together a specific audience across various service providers. Some of those limitations are lifted once AT&T officially gains control over Time Warner’s networks and other properties.
Turner’s properties serve up 750 billion ad impressions a year compared to the 200 billion ad impressions per year that AT&T has access to on DirecTV, AT&T CEO Randall Stephenson said at Recode’s Code conference last month. After the merger, AT&T will be able to handle all of the ad impressions across Turner’s networks that are served to the 25.4 million people in the U.S. that subscribe to its linear TV and streaming TV services.
Moreover, because those TV services are not restricted by location like traditional cable providers, AT&T can offer the national coverage that Ratner said is currently lacking. Finally, because those viewers are all AT&T customers, AT&T would be able to standardize how the audiences are segmented, ads are delivered and performance is measured.
“Consolidation on the sell side in general is not good for advertisers. However, consolidation also creates buying opportunities, opportunities to have unified platforms, unified reporting and consistency of inventory,” said Ratner.
The post With Time Warner deal approved, AT&T can focus on addressable TV ambitions appeared first on Digiday.
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