TVE, OTT Offer New Rev, But Threats Loom

The technologies behind TV Everywhere and OTT are creating new business opportunities for broadcaster and — at least for the time being — insulating them from ad-blocker software that otherwise could kneecap their plans to distribute content to digital platforms.

“We are just on the cusp of where [broadcast] affiliates begin to see a new monetization model,” says Ralf Jacob, Verizon Digital Media Services chief revenue officer.

“Virtual linear feeds assembled on the fly based on viewer profile information will allow them to monetize content in a way they never have been able to do before,” he says.

Verizon Digital Media Services, which counts Fox, Sinclair Broadcast Group, Hearst Television, Graham Media Group, ESPN and Viacom among its customers, sells Slicer, a cloud-based OTT platform the encodes and transcodes uploaded broadcast content in parallel for distribution to laptops, smartphones, tablets and other devices.

With Slicer, broadcasters can “slice and dice” their linear program feed into “a lot of components” that can be viewed separately, such as an individual story from a local newscast presented on Facebook, or stitched together into “virtual linear feeds” that suit the tastes of unique individuals in the OTT audience, he says.

From a business perspective, doing so creates new opportunities for broadcasters to reach viewers with tailored programming and commercials, augmenting their OTA and MVPD (multichannel video programming distributor) revenues, Jacob adds.

Enlisting the support of MVPDs is a critical part of making TV Everywhere a reality, says Jack Perry, founder and CEO of Syncbak, a Cedar Rapids, Iowa-based venture backed in part by CBS and NAB.

At least to Perry, TV Everywhere is a very specific subset of over-the-top content delivery that provides for MVPD authentication, or confirmation that the viewer trying to access content is a customer in good standing.

Without it, viewers are barred from accessing TV on their mobile devices and computers.

“There has been significant progress [in enlisting the support of MVPDs],” Perry says. “We are gaining steam on getting the rights cleared as people who own the rights are gaining confidence that it [broadcast content] can stay in-market and that it can be segmented by device type. It is much better than a year ago.”

Syncbak is the TV Everywhere engine powering CBS All Access — the network’s real-time streaming service that delivers its programing to viewers on their digital devices — as well as OTT delivery for the Fox O&Os and Raycom Media.

So far, 143 CBS affiliates have signed on to offer CBS All Access, and Perry says he is confident all CBS affiliates eventually will get on board.

But these sorts of new business opportunities do not come without technical challenges. One of the biggest is ad-blocking software, which has given heartburn to many online content publishers, says Matt Smith, chief evangelist and solutions architect at Anvato, a TV Everywhere and OTT system provider for NBCUniversal, Gray Television, Media General, Graham Media, Fox Sports, CBS Local Media, Scripps Networks Interactive and others. (Editor’s note: Some of the broadcasters and media companies referred to in this article use TV Everywhere and OTT products from multiple vendors, which accounts for the overlap.)

A study by PageFair and Adobe released in fall 2015 shows why.

It found the number of monthly average users of ad-blocking software in the United States stood at 45 million in June 2015, up 50% from the prior year.

Just as disturbing as lost revenue are interruptions in the continuity of streaming video caused by ad blockers. The result can be on-screen spinning wheels, unwanted disruptions and, overall, a bad user experience, Smith says.

These types of user experiences directly impact the ability of a broadcaster to retain its OTT viewers, who are likely to surf away to other online destinations when ad-blockers interrupt streams, adds Verizon’s Jacob.

Defeating ad-blocker interruptions is a matter of avoiding client side ad insertion, or CSAI, says Smith.

“What an ad blocker is looking for — on an iOS or Android device or on a laptop — is a request from the media player that is calling out to an ad network saying ‘Give me an ad,’ ” Smith explains.

If the ad blocker doesn’t see the request, it won’t interrupt the content.

Both the Verizon and Anvato OTT solutions stitch together programming and commercials on the server into a continuous stream, eliminating the need for client-side ad requests and thus taking out of the equation the hook ad blockers need to function.

While the stream is continuous, there exists a playlist that describes where all of the discrete content elements, or files, reside before being assembled into a video stream, says Smith.

To protect from the prying eyes of ad-blockers, Anvato encrypts both the playlist and individual “stream chunks.”

“In the not-too-distant future, ad blocker software companies will be looking under the hood for all of the discontinuity tags,” Smith says.

Such tags make it possible for the server to switch from program content to a commercial and back again while creating the continuous content stream.

“If your playlist is not encrypted, you are at risk for that sort of activity,” Smith says.

Verizon’s Jacob adds that the act of stitching together content and ads on the server in no way precludes creating unique video streams, including targeted commercials, for individual OTT viewers.

“We have a unique environment in which the service provider [broadcaster] can determine where you reside, what ad might be relevant, communicate this to the ad decision system — such as SpotXchange, Adapt.tv and FreeWheel — and retrieve the ad.

“Even though this is a unique session for an individual viewer, it is prepared many seconds before it is consumed,” Jacob says, adding that this makes it possible to deliver customized streams that still defeat ad blockers.

Whether or not stitching content and ads together on the server is a permanent solution for ad-blocking software interruptions is unclear.

Anvato’s Smith says the situation is similar to the early days of digital media and digital rights management.

“If you applied DRM to content, someone out there is always going to try to hack it. It becomes a game of Whack-a-Mole.”

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