Comcast-NBCU Will Get the (Ad) Message Out

Among the wish-list benefits of a Comcast-NBCU deal is its potential to help advance the cause of addressable advertising—tailoring suitable ad messaging to the consumer—currently being developed in ad trials by Comcast.

“We think this is a seminal deal and signals a change in the media landscape,” says Laura Desmond, CEO of Starcom MediaVest Group, of Comcast's acquisition of a majority stake in NBC Universal. “Putting together a distributor with a mass broadcaster unleashes all sorts of advances in TV measurement from the set-top box. There are also national and local synergies.”

Starcom has been intimately involved in addressable advertising trials with Comcast in Huntsville, Ala., and in Baltimore, Md. “We have seen very positive business results from that,” says Desmond. “The idea of taking some of Comcast's trials in the area of interactivity and bringing that expertise to broadcast television is a very powerful thing.”

Desmond said addressable advertising had been held back by cable operators' inability to deliver scale. The addition of mass via the broadcast network “is the very intriguing development.” Comcast is also working on interactive applications, such as requests for information services. “The ability to have those interactive applications and gain more content and more channels could be great for advertisers,” said Comcast COO Steve Burke on a call with the media last week, adding that 23% of the revenue of this new company will come from ad sales.

Rino Scanzoni, chief investment officer at Group M, agrees this deal might also speed the progress of addressable advertising, potentially giving networks the ability to sell the same ad spot numerous times to different clients targeting different subsets of the audience. That said, Harry Keeshan, executive VP of national broadcast at media communications company PHD U.S., believes closing the deal will “take a while and though the focus is on cable, we'd like to see more effort on the broadcast side of things.” Keeshan thinks the addition of Comcast might help NBC Universal shore up the primetime broadcast line-up.

Scanzoni adds that having Comcast rather than GE as majority owner of NBC Universal could mean the network might not be so tightly squeezed for efficiencies: “In the short run, there might be less economic pressure on NBC.” Scanzoni also added that NBC could be the first network to convert to a cable network that involves subscription fees and 24/7 programming, saying, “I could see that happening sooner with NBC.”

Another potential benefit of the deal for Madison Avenue might be speeded up access to set top box data for better audience measurement, something that Alan Wurtzel, NBC Universal president of research, has been pushing for as part of the Coalition for Innovative Media Measurement.

While Madison Avenue may see upside, the deal will take up to a year to complete and will not be without hurdles. Susan Eid, senior VP of government affairs for DirecTV said in an email statement to B&C: “We are evaluating the potential effects of this transaction on our company as it creates significant media concentration. We expect the government will closely scrutinize this deal to protect consumers, choice and competition. ”