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Advertising: The Year We Make Contact

Mark 2010 as the beginning of a new era in television advertising. A host of seedlings from TV Everywhere; a full-fledged addressable advertising business; and, more recently, Apple's talks with the networks to form an online subscription TV package all look set to radically advance the TV ad business.

Many advertising aficionados say that 2010 will be the year when advanced advertising graduates from beta status to prom night. This year, they say, the endless trials and test phases and various regional deployments will actually move into the spotlight, thanks to increased scale. “God knows how many years we've been predicting what will happen in addressable advertising,” says Tara Wal-pert Levy, president of Visible World. “In 2010, you'll see it in a major way.”

Canoe Ventures, the cable industry's hope for a national addressable platform, will be moving forward with its plans to take a balkanized cable ad business national. Visible World's own addressable advertising product, executed in conjunction with Cablevision, will be rolling out in mid-2010 along with a half-dozen major marketers, though none have been named.

Add to that mix Comcast's plans to revolutionize the set-top box to deliver interactivity and the firm's likely ownership of NBC Universal, and the future of advertising begins to look like it's finally here. All that's required is a catchy 2.0-type brand name. (Post your own suggestions on our advertising blog ADverse.)

Need a definition of addressable advertising? It's simply advertising that targets a segment of consumers (e.g., cat owners) and/or is interactive (the consumer can ask for more details or respond in some way), and is easily measurable as well (ideally, data supporting the notion that an ad campaign prompted sales).

After the scorched earth of 2009, advertisers' needs for ever greater ways to measure the effectiveness of their ad spots will drive the addressable model. Rino Scanzoni, chief investment officer at GroupM, agrees: “We'll actually see some real deployment of addressable advertising.”

In a smart attempt to be part of the future of TV viewing in whichever form it takes, Comcast was first off the ground with its TV Everywhere initiative, rolling out TV shows for the Web in mid-December via its online site Fancast Xfinity. Expect other distributors such as telcos AT&T and Verizon FiOS to launch their full-fledged TV Everywhere products early in the first quarter. And broadcast network-driven online destination Hulu is preparing for some form of subscription offerings. According to Walpert, “Another thing we've wished for is cross-platform media. It's going to be a reality in 2010.”

By August, Nielsen says it will be ready to start doling out data from its TV to PC-ready people meter panels, delivering advertisers the much-sought-after ratings covering the two screens. Of course, the TV ad business won't be relying entirely on Nielsen. The Coalition for Innovative Media Measurement, championed by NBCU chief researcher Alan Wurtzel, will also be in full swing in 2010. The group has two main thrusts: finding out exactly how set-top-box data can be put to better use, and how cross-platform viewing behavior can be measured.

Same as it ever was?

Despite these myriad initiatives, expect the everyday buying and selling of TV to remain much the same as it always has. CBS Corp. CEO Leslie Moonves is already predicting a buoyant May upfront, given that scatter pricing increases have been in the double digits pretty much all around the dial. While there is little doubt that business is on an upward trajectory, the consensus would say that things are still shaky at best.

The fourth quarter of 2009 was plenty active, with some top-tier cable operators such as Turner's TBS and TNT selling out in early December. Whether that will continue into the first quarter—which this year features the Winter Olympics in addition to the Super Bowl—is anyone's guess. Sales have been brisk for the Super Bowl, with CBS pegging spots at slightly less than the $3 million NBC was able to charge for the last go-round. Already, though, PepsiCo has said it won't advertise its core drink brands for the first time in 23 years, but will still flog its chip brand Doritos. CBS was 90% sold out for the Super Bowl before the holidays.

“It will be an interesting year,” Scanzoni concludes. “Anytime you have an economic climate that's challenging, it will spur innovation. When everyone is fat and happy, there is no need to change….We're going to start seeing things that we've all been talking about take root, or at least there's some real solid experimentation that could pave the way for it.”

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