Expanded Ad Sales Among 3.0’s Potential

Creating a “virtualized national presence” that would give broadcasters the ability to sell advertising on a national and regional basis was one plan for using ATSC 3.0 that was put forth AT TV2020 by Sinclair Broadcast Group’s Mark Aitken.

Broadcast executives and consultants wrapped up TVNewsCheck’s TV2020 conference at NAB New York Thursday by walking through some of the various new businesses that stations could launch using the proposed ATSC 3.0 digital TV standard. 

Aitken, VP of advanced technology for Sinclair Broadcast Group and one of 3.0’s staunchest proponents, said he didn’t want to disclose everything Sinclair is planning because of competitive reasons. But he said one attractive option would be to pool bits across stations to create a “virtualized national presence” that would give broadcasters the ability to sell advertising on a national and regional basis as well as local. 

“Local broadcasters have a very small piece of the national pie, and there’s a reason for that, we’re not national,” says Aitken. “But a virtual network could go to Madison Avenue and sell as a national platform.”

Other verticals that would benefit from such data distribution with a national reach could include agriculture and trucking. 

“All of that requires a buildout, but it’s not going to happen in the 39 months the FCC is going to allow us to build out,” said Aitken, referring to the timeline given for creating new transmission facilities under the FCC’s spectrum repack plan.

The panel, “New Revenue Streams: Datacasting and Pay Broadcasting,” moderated by TVNewsCheck Editor Harry Jessell, included Anne Schelle, managing director of Pearl TV, a coalition representing more than 220 TV stations, who said that datacasting through 3.0 could generate significant consumer demand, but perhaps as more of a B2B service. She echoed an idea broached earlier in the day by Sinclair CEO David Smith, who said that there could be a big business in providing bandwidth to content delivery networks like Akamai. She noted that the 4K streaming services being launched by OTT players like Netflix and Amazon could be a good fit for datacasting.

“4K movies are really big data files,” said Schelle, who added that broadcasters’ cost per bit to deliver a large file movie would be much more economical than delivering the same movie through a broadband network. 

She said that a movie could be delivered by broadcasters overnight through a data carousel, and a consumer might theoretically pay half the price for a movie to get it delivered that way versus broadband streaming. Other bit-intensive applications that broadcast spectrum would be well-suited to could include updates to smartphone operating systems such as Apple iOS, data downloads to automobiles or the delivery of Internet of Things (IoT) files.

“It’s a lot of options,” said Schelle.

Richard Ducey, managing director of consulting firm BIA/Kelsey, lent the panel some historical perspective on the datacasting business. Ducey described how SpectraRep, a datacasting firm he helped launch back in 2000 with ATSC 1.0 technology, originally started with consumer applications in mind as did some other firms like iBlast and Geocast.

When those business models didn’t sync with the existing technology, SpectraRep shifted focus and found a profitable niche in providing alert and warning services to government agencies. SpectraRep today counts the Department of Homeland Security, the Coast Guard and several state police agencies as customers. 

Broadcasters’ bandwidth is often compared to real estate, and some have suggested just leasing that real estate to third parties like wireless companies. But Ducey noted that developed land tends to be more valuable than just plain earth.

“It’s real estate, but the platform you build up on it has a lot of value,” he said. “It is just like developing a property — you could have stores, but you don’t have to run them.”

Using 3.0’s increased bandwidth efficiency to launch an over-the-top (OTT) video service that would compete with cable and satellite services has been touted as a potential business. That is certainly technically feasible, said Aitken, who estimated that two stations working together in a market could easily deliver 20 720p HD channels.

But the “skinny bundle” space is a competitive one these days, cautioned Peter Leitzinger, associate research analyst with S&P Global Intelligence. He noted that there are a “lot of big industry players” providing skinny bundles at a low price, including DirecTV and Verizon, along with “virtual service providers” like Sling TV and Sony Playstation Vue. And technology giants like Apple and Google are waiting in the wings.

“What broadcasters have to do,” said Leitzinger, “is to make sure what they’re providing in a bundle is different than what you can get over-the-air, maybe by partnering with other high-value programming.”

The panel actually launched with a presentation of a next-generation service that broadcasters would provide for free: a complete overhaul of the national Emergency Alert System (EAS) that would take full advantage of the IP-based interactivity that 3.0 can deliver.

John Lawson, executive director of the Advance Warning and Response Network (AWARN) Alliance, described the powerful alert system developed by AWARN members LG Electronics, Sinclair Broadcast Group, Pearl TV, NAB, Capitol Broadcasting Co., Digital Alert Systems/Monroe Electronics, GatesAir and Triveni Digital. Lawson said that the AWARN system can deliver much more information than the sparse emergency alerts provided on TV and phones today. 

For example, he contrasted the 90-character Amber Alerts that smartphone users receive today with a prototype AWARN system developed with the National Association for Missing and Exploited Children. The AWARN alert would appear as a graphic overlay on a smart TV screen that users could click to receive more information, including a photo of a missing child, photos and license plate number of the involved vehicle, and a map of where the abduction took place.

Similar AWARN alerts could be created for 3.0-compliant TVs and smartphones for other emergency situations such as severe weather, chemical spills or armed fugitives on the run, such as the suspect in September bombings that took place in New York and New Jersey. The AWARN system could even “wake up” a dormant device to alert its owner of danger.

Having such alerting capabilities could help make a powerful regulatory case for having 3.0 reception capability in consumer devices, noted Lawson. “Alerting has been a cornerstone of television since the Second World War,” he said. “We’re not asking for a mandate, we don’t think that’s the right way to go. But if we can give people this type of capability, we can create a pretty powerful consumer demand.”

See all of TVNewsCheck’s TV2020 coverage here.