Verance Claims Solution To Prevent Emerging Issues With Nielsen’s DAI
Verance, a global provider of standards-based watermarking solutions, said today it has developed a mechanism to prevent issues emerging with the use of fingerprint-based Dynamic Advertising Insertion (DAI) technologies with Netflix and other SVOD content.
The Verance technology, it says, “solves one of the biggest challenges standing in the way of promising new DAI technology, which provides broadcasters and advertisers with the ability to deliver different ads to different viewers in broadcast systems — putting ad-supported broadcast television on par with OTT video services.” The solution developed by Verance would enable Netflix, Hulu and others to privately identify their content to TVs to ensure that each service’s content is neither measured nor manipulated via the insertion of unauthorized dynamic ads.
This would help alleviate industry fears over Nielsen’s fingerprint-based Dynamic Advertising Insertion (DAI) technology, because fingerprint-based systems are unable to always differentiate content from streaming services with content from syndication. With Nielsen’s DAI technology baked into new smart TVs this quarter, SVOD services and TV makers are concerned it could soon lead to ads or measurement functions meant for broadcast being mistakenly placed into the streams of Netflix, Hulu and other video services.
“We believe this will create a path forward for the subscription VOD and ad-supported broadcast worlds to co-exist,” says Verance CEO Nil Shah, who will discuss the topic today during a NATPE Analytics & Addressability Online Forum panel in conjunction with NAB New York.
While TV makers are able to ensure ACR technology is turned off when apps run natively on a smart TV, they currently have no way to do that for SVOD content played or casted from devices connected to the TV via HDMI. SVOD content is indistinguishable from broadcast content when each is received from attached devices including media sticks, set-top boxes and A/V receivers.
For a series such as Seinfeld, which has multiple runs appearing across national syndication, basic cable and Netflix, this could mean DAI commercials targeted for ad-supported broadcasters could unknowingly be placed into the Netflix stream. The same would hold true for other highly popular syndicated series including Peacock’s The Office and HBO Max’s Friends.
In the case of an SVOD platform such as Hulu, which offers national and local advanced advertising reach options for brands with automated, data-informed ad buys, the impact of lost revenue from having inventory replaced by DAI could translate into higher subscription fees for consumers.
Shah says: “As broadcast TV becomes more interactive, it is important for TVs to have more advanced ACR technology. We not only need to know what content each person is watching but how it is being distributed. If I am watching Seinfeld on Netflix and hit pause or playback, that shouldn’t be an opportunity for an ad that is supposed to appear in broadcast syndication to play and ruin my ad-free viewer experience on a subscription service.”
Verance, which has been working closely with manufacturers, programmers and distributors to create next-generation TV viewing experiences for consumers, stepped in with the new technology allowing SVOD platforms to send the private messages notifying TVs that no measurement or ad insertion should take place. The messages between a platform and the TV are kept private to prevent Nielsen or others from using the information gathered to infer viewership.
The mechanism is meant to remedy a dilemma for TV makers, which now have to choose between maintaining a critically important relationship with Netflix or successfully developing new revenue streams amid declining price points and slim margins for TV hardware.
Netflix has tremendous market clout brought about by its 100 million-plus subscriber advantage globally over its nearest competitor, Disney+, and its status as a “must have” feature of consumers buying connected televisions. Netflix can insist ACR technologies be deactivated during viewing of its content in order to preserve the integrity of its subscribers’ viewing experiences and maintain sole control over measurement of its viewership.
Shah said he believes this solution will keep Netflix and its consumers happy by assuring the integrity of SVOD’s seamless experiences; allow manufacturers and chipmakers to sell more TVs; continue to provide significant backend revenue to studios; and permit advertisers and ad-supported services to benefit from dynamic advertising growth, even with devices connected to the TV via HDMI.