ACTV has been ready for Aurora, Colo..now AT&T is ready,
--------------------------------------------------------------------------------
Directed TV Ads Are Coming: Who's Watching Who?
By Kevin Featherly, Newsbytes
AURORA, COLORADO, U.S.A.,
13 Jun 2001, 5:21 PM CST
Let's say you live in Aurora, Colo. Next time you tune into a Denver Broncos game in that town and see one of those Budweiser frogs ads, you might well wonder if the rich guy in the ranch-style house atop the hill is having a Lexus ad piped into his house at that very instant, during that same game.
He might be.
That kind of ''directed advertising'' - in which even next-door neighbors might see different commercials while watching the same TV shows - is going to be tested in Aurora, possibly in the third quarter of the year.
AT&T [NYSE:T], the biggest cable company, is planning to test with a company called ACTV, a technology it calls SpotOn that can target advertisements directly to the digital set-top boxes in individual homes according to household demographics. SpotOn was created in a partnership with Motorola and OpenTV, according to information on the ACTV Web site.
Tracy Baumgartner, a spokeswoman for AT&T Broadband, told Newsbytes that the test will involve 30,000 residents of the Denver suburb who have digital set-top boxes installed in their homes.
She said that advertising will be directed according to three demographic categories: households that have or don't have children; households with incomes under $50,000 annually; and households earning more than $75,000 a year. All homes fit into at least one demographic category, and many will fit into several.
''We're going to test whether we can segment the advertising in those markets,'' Baumgartner said.
She said that AT&T will study customers' reaction to the directed advertising, which Baumgartner said consumers will find more consistently compelling than the scattergun approach customarily used. For instance, a single woman with a meaty salary may no longer have to sit through Pampers commercials. She might instead get to watch lots of ads for sports utility vehicles.
But the test will be relatively restrained in the types of information it tries to glean from viewers, Baumgartner said. ''Is the information more relevant to (viewers)? And what do the advertisers think of that, do they think it's worth the segmentation?'' she asked. ''That's as far as we're going.''
But it could go much farther. The Los Angeles Times on Tuesday quoted an ACTV official as saying that while there are no plans to track what viewers are watching now, the technology in digital set-tops allows for that. There is obvious value in that for advertisers, who likely would pay a premium for directed ads. Advertisers frequently buy particular ad spots during particular TV shows and could be expected to demand figures on how well those ads are doing with viewers.
ACTV officials could not be reached for comment by Newsbytes. But Baumgartner said that AT&T has no plans to do anything like that. ''I can't predict what's in the future,'' she said. ''I can tell you that this trial cannot split that far.''
The 1984 Cable Communications Policy Act demands that cable operators must disclose whatever types of personally identifiable information they collect about their subscribers. Under the law, they also must receive approval before sharing any of what they learn with third parties. But the law apparently does not directly address what might be done with information gathered internally by a cable company, Tuesday's Los Angeles Times reported.
The newspaper reported that other cable companies, including Cox Communications and Time Warner Cable, are planning their own variations on the directed-advertising tests.
Baumgartner said that AT&T Broadband does keep track of what set-top boxes are installed in particular homes. ''We can identify by set-top box number, we know what set-top box is at what address,'' she said. ''But the set-top box is not personally identifiable.''
However, she said, the cable company does have quite a lot of demographic data on households, which it obtains from other sources. ''We know that the same way that direct marketers around the company know, we buy information from ... all of the third-party resources,'' she said. ''We get that same information.''
Meanwhile, project partner ACTV, in a July 11 press release detailing extensions to its SpotOn technology, said it would begin allowing advertisers to extract more consumer information through opt-in marketing surveys. ''Utilizing the operator's (video on demand) connection, consumers can access a marketing survey and receive free products as a reward for participation,'' the press release said.
It all gets into some pretty dodgy terrain, said Scott Doniger, a media and entertainment analyst with Forrester Research. He said that while the planned AT&T trials seem limited enough, he thinks they are simply the first step. More sophisticated trials are almost certain to follow, he said. It all could lead eventually to a situation where you are no longer just watching commercials - they also are watching you, he said.
''After behavioral profiles have been generated - because set-top boxes will enable that - ads will be much more targetable,'' Doniger said. ''Certainly the programmers will be (monitoring consumers) and certainly the distributors and broadcasters will be, absolutely. And so will the advertisers.''
There is no doubt, Doniger said, that such behavior tracking crosses the line, breaches privacy. ''I think everybody is cognizant of that,'' he said. ''But certainly this is the future, the profiling that will take place gleaned from information from digital set-top boxes.''
It could lead to some backlash, he suggested, but first, people would have to notice. And he doesn't think they will unless the practice becomes the subject of intense media scrutiny.
But even if that doesn't happen, the practice of delivering ''compelling'' advertisements into your home might give viewers a disquieting sense of what Madison Avenue thinks of them, Doniger said. For instance, you might find yourself pummeled on all channels with Mountain Dew ads that seem to espouse skull-to-skull combat with mountain goats. You might interpret that to mean that the advertisers know you have a teenager in your house, and that they think your teenager is an idiot male.
''That's why I think it's in everybody's best interest to be as upfront as possible,'' Doniger said. There's no doubt, he said, that targeted TV advertising is a great opportunity for marketers, broadcasters, cable distributors and satellite operators. But the audience should not be underestimated, and they must not be left out of discussions when the practice begins in earnest, he said.
''Consumers do not want to have the impression that television broadcasters or cable operators are spying on them, or judging them,'' Doniger said. ''In a world where people with personal video recorders have the ability to cancel out ads that they don't want to see, all of these issues are very much open to debate.''
Reported by Newsbytes.com, newsbytes.com .
(20010611/WIRES TOP, TELECOM, LEGAL, ONLINE, BUSINESS/)
© 2001 The Washington Post Company
--------------------------------------------------------------------------------
<< previous Message Next Message >> |
