Pay TV Operators: Adding Value to the Addressable TV Market

In addition to operating the main technical components of addressable TV on their distribution ecosystem (set-top-box and OTT) to enable targeted ad advertising on linear TV, time-shifted TV, catch-up, and VOD, pay TV operators also play a large role in the business side.

Along with owning the user relationships and supporting tier 1 broadcasters, they also have the ability to leverage their own ecosystems and inventory through partnerships enabling smaller broadcasters who seek greater access to resources. Pay TV operators play a part in: working with content partners on different inventory sources; the decisioning with operator audience segments; broadcaster business rules for the eligibility of ad replacement/ad insertion; and activation with advertisers on direct or programmatic execution.

Below we explore five areas where pay TV operators are highly involved in the addressable TV landscape and how they contribute to its success as a key stakeholder.

Adding Value in the Addressable TV Market

1. Unique relationships

Pay TV operators have a direct relationship with customers for whom they manage the distribution and delivery of TV content on both set-top-box and OTT. By doing so, operators have a 360°  view of household TV/video consumption – everything from the type of content being consumed to the specific daypart it is being consumed in. While broadcasters only have a view of their owned ecosystem, operators benefit by having access to a complete view of the data landscape through these direct relationships.

2. Improved Performance

The valuable deterministic data derived from their CRM and viewing TV households are key in improving media planning and campaign targeting. Access to this operator data provides advertisers with new avenues to push tailored messages – through geo-targeting or specific audience segments like low TV viewers, for example. This data also allows for better management of campaign frequency and ROAS.

3. Exclusive Data

In markets where data privacy and regulation apply (like Europe for example), they have the responsibility to collect user consent to allow targeted advertising for each household to provide transparency on the data collection and purpose of their usage. With new regulations like GDPR, this data is very unique in being first-party data that’s fully owned and controlled by the operator and can be valuable both in monetization and for making content recommendations.

4. Ecosystem Enablement and Activation

On the inventory side, they actively participate in the eligibility and activation of addressable inventories by implementing advertising technology on several perimeters.

This is done in respect of each market’s rules and regulations – usually through close collaboration between the key advertising bodies (operators and broadcasters). Operators syndicate their data to enable broadcaster inventory for addressable TV, which is the main use case in most countries. They can also package their own inventory to act as an inventory provider for smaller broadcasters through different sources if they:

• have owned and operated TV channels and VOD content
• get shared-inventory coming from their distribution agreements
• aggregate inventories from smaller broadcasters and streaming apps

5. End Call on Execution

Finally, operators execute the ad insertion or ad replacement on the request of either the broadcaster’s ad-decisioning system (in respect of the existing TV business rules and addressable inventory opportunity) or through its own ad server for its own inventory.

Pay TV Operators are Critical to Success

As spend grows and marketers seek more rich data with viewers demanding seamless viewing experiences, it’s clear that understanding and leveraging the role of the pay TV operator is critical to success in the addressable TV market. Pay TV operators own the user relationships across several channels, allowing them the unique opportunity to provide added value to both tier. 1and smaller broadcasters alike.

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