Dish to test automated TV ad sales

Reuters News
Posted: Oct 26, 2015 9:02 AM

By Malathi Nayak

NEW YORK (Reuters) - Dish Network Corp <DISH.O> will begin experimenting with automated ad sales, moving away from the pay-TV industry's years-old way of selling ads through phone calls, paperwork and in-person deal-making.

Dish will open up a digital ad market to let advertisers buy linear television ads as a beta test before officially launching at a later date, the company said in a statement on Monday.

"We're bringing the ease of digital ad buying to the TV marketplace," Adam Gaynor, vice president of media sales and analytics at Dish, said in an interview.

Dish will work with ad-buying firms Rocket Fuel, TubeMogul and DataXu, the company said.

Automated or programmatic ad technology allows each ad impression to be offered up by sellers on a digital ad exchange and buyers make real-time bids based on data about individuals they aim to target.

Television still represents the largest slice of advertising revenue but digital advertising is growing quickly. Advertisers are expected to spend $70.6 billion this year on TV and $58.6 billion on digital media including mobile, according to research firm eMarketer.

As more eyeballs shift to online video on digital services and advertisers get used to the flexibility of buying, selling and placing digital ads on the fly, the pay-TV industry is under pressure to follow suit.

"Our goal is to go get online (advertising) budgets," Gaynor said.

Pay-TV providers collect customer data through set-top boxes. Dish's automated ad market can reach 8 million households with set-top boxes that record data useful for targeted advertising.

Dish will use 80 specifications like age, gender, and education and plans to bring in more data sets, Gaynor said.

Dish's set-top boxes record whether the ad ran on the TV set or was skipped which is feedback for advertisers, Gaynor said.

Digital ads can be placed instantly. Television ads can be bought in real-time but it takes a couple of days to be slotted into programming, he added.

Late last year, Walt Disney Co's <DIS.N> ESPN experimented with programmatic ad auctions for its SportsCenter show. Disney's ABC and Comcast Corp's <CMCSA.O> NBC have tested programmatic ad-buying on their online video offerings.

Pay-TV providers have access to two minutes per hour of ad time in local programming. While ABC, NBC, CBS and Fox and their affiliates sell ad slots independently, commercials from Dish's ad inventory can run on channels such as the Food Network, Gaynor said.

(Reporting by Malathi Nayak; Editing by Chizu Nomiyama)