NCC Moving on Road to Interactive Ads

New York -- Spot-cable rep firm National Cable
Communications is steadily putting the elements in place to get its "Targeted
Television" initiative under way by Jan. 1.

The objective of that initiative is to enable ad agencies
and advertisers to make spot-cable buying easier and to have their commercials delivered
electronically to precise zones across multiple markets -- especially in the top 50
markets, which absorb the bulk of national spot television and cable dollars.

Olson likens this initiative to the "unwired
network" concept that's long been done by broadcast rep firms like Katz Media Group
Inc. and John Blair & Co.

An unwired network consists of various stations packaged
according to demographics, for instance.

But ultimately, NCC intends for this proposal to lead to
its spot clients' having access to interactive advertising, as well.

The blueprint calls for NCC to start testing Targeted
Television in an unspecified number of top markets by Jan. 1, and to roll it out to the
top 50 DMAs during 2000, NCC CEO Tom Olson said in a phone interview last week.

Toward that end, Olson said, NCC executives met a few weeks
ago with the rep's five MSO partners -- AT&T Broadband & Internet Services,
Comcast Corp.'s Comcast Cable Communications, Cox Communications Inc., MediaOne Group Inc.
and Time Warner Cable -- to discuss the technical aspects.

Another meeting with the MSOs is slated for late this
month, but Olson said, "I'm proceeding as if this is a green-light item."

MediaOne vice president of ad sales Ed Dunbar, for one,
found the concept intriguing.

Targeted Television's participants will allocate "a
very small percentage of dedicated inventory," Olson said -- "probably 1 percent
or 2 percent of their inventory."

"It's going to be a building process," he said --
a hint that this percentage might increase at some future point.

Still, he added, it won't approach the 15 percent to 35
percent range given over to various interconnects, with Los Angeles interconnect Adlink on
the high end of that spectrum.

In addition, NCC and the MSOs met in late April with about
a half-dozen ad-agency executives so that both sides could voice their ideas on what
they'd like to see come out of this initiative. Grey Worldwide, Ogilvy & Mather,
Saatchi & Saatchi, J. Walter Thompson Co. and Young & Rubicam Inc. were

Although another half-dozen agencies, such as BBDO
Worldwide, did not attend, Olson was not concerned, since it was a preliminary meeting.
The smaller group made it easier for both sides to discuss their viewpoints in detail, he

Reaching the top 50 DMAs is important "to accommodate
the customer point of view," Olson said, since "the majority of dollars in spot
broadcast and cable are spent in the top 50 markets."

But "the technical infrastructure [of Targeted
Television] is not important to advertisers," he added, so long as they get the
desired DMA-wide reach and the convenience of a single invoice and one-stop shopping
through the post-buy verification phase.

To accomplish its goals, Olson said, NCC must be able to
offer the advertising community seamless electronic data interface. By the end of April,
85 markets had EDI up and running, he added. "I would guess that the probable number
is near or over 100 markets now."

That's well ahead of the pace outlined last fall by Ken
Little, who was recently promoted from vice president of NCC's interconnect division to
the rep firm's senior vice president of technology/operations, as well as project manager
on Targeted Television.

Little had projected last October that 50 markets would
have adopted EDI by mid-1999.

"VNI [Video Networks Inc.] is doing a nice job in
getting the [EDI] equipment installed at the headends," Olson said. "The goal is
to have all of our markets done by year-end."

Although Targeted Television sounds a lot like a national
interconnect -- a concept long rumored but long pooh-poohed by the top MSOs -- Olson
disputed that notion.

One MSO executive said the two concepts have some
similarities, but Olson maintained, "I stay away from the term, 'national
interconnect.' I talk about it in terms of an ad hoc network for a particular brand."

The idea of targeting, say, DaimlerChrysler's Mercedes-Benz
spots to upscale neighborhoods comes most readily to mind.

But Olson said the approach can also work by matching
products from Campbell Soup Co.'s Prego spaghetti sauce to Whitehall-Robins Healthcare's
Advil pain remedy with markets where those products' usage is highest, based on ad
agencies' consumer data.

"We look at [Targeted Television] as a central
distribution point at combinations of 1,000 headends in the top 50 markets," Olson

As for whether that initiative might be able to target
spots and give them appropriate dealer tags in various neighborhoods simultaneously -- as
Adlink does in Los Angeles, for example -- he said, "I'm not sure I have the answer
at this point."

That may be why NCC has no advertiser commitments to date.

Although Kraft Foods and AT&T Corp. have committed to
interactive-advertising buys on former Tele-Communications Inc. cable systems, and General
Motors Corp. has signed with TiVo Inc., Olson said NCC does not yet have deals from those
accounts or others.

But based on discussions with those clients' agencies,
"They're clearly interested in doing it," he added.

Commitments may await the advent of advanced addressable
set-top boxes, he said. In the interim, having cable advertisers link with Web sites is
another possibility -- "a steppingstone" to true interactivity.