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State of the Screens

Who Are The Winners In The Roku/Nielsen Deal?

By March 11, 2021No Comments

Roku on Phone Screen

Big news: Roku and Nielsen struck a deal that could have major implications for both addressable advertising and video ad measurement.

What Roku gets:
1) Nielsen’s Advanced Advertising (AVA) business
2) ≈ 100  employees
3) 700+ filed potents globally
4) Automatic content recognition (ACR) technology
5) Dynamic ad insertion (DAI) technology

How it will work:
1) Roku’s operating system, combined with Nielsen ACR, will know what is on TV for both linear and streaming
2) Roku offers networks the ability to replace the mass-targeted ad with an addressable ad through DAI
3) Networks offer addressable ads to marketers

What Nielsen gets:
1) Access to CTV viewership data from Roku’s 51.2M households bolstering the forthcoming Nielsen ONE currency (≈ 100M TV devices)
2) Nielsen’s Digital Ad Ratings (DAR) and Total Ad Ratings (TAR) integrated with Roku’s OneView buying platform

Worth the time: Tracey Scheppach brings us up to speed on how this deal could accelerate addressable TV.

Flashback #1: Matter More Media CEO Tracey Scheppach Shares How Addressable TV Is Reshaping the Industry

ScreenBytes Tracey Scheppach YouTube Thumbnail

Why this matters: Significant demand exists for addressable TV advertising (see CTV). Still current inventory is primarily limited to 2 minutes per hour from the local pay-TV provider AND airing on a cable network, meaning ≈ 97% of TV ad impressions are not addressable.

Current Linear Addressable Scale Based on Viewing Time of Ads

What everyone wants:
1) Consumers – Fewer ads.
2) Advertisers – A higher return on ad spend (ROAS) with improved measurement.
3) Networks – A higher share of consumers’ time. More money from advertisers.

U.S. video ad spend by targeting method (% of total):
1) Non-Targeted – $46.3B (41%)
2) Addressable Digital – $38.0B (34%)
3) Data Driven Linear – $25.2B (22%)
4) Addressable Linear – $2.9B (3%)

Targeted Video Ad Market = 113B by 2024

Quote from Tal Chalozin – Co-Founder and CTO @ Innovid:
“It’s a vital part of TV as he who controls the operating system can build other things such as ad insertion and measurement. Look at how Microsoft won the PC era while Google and Apple won the Mobile era. Moving into the CTV era, Roku is making moves towards being the winner with this acquisition, gaining the ability to monetize time spent watching linear TV on their platform.”

 

Flashback #2: Innovid CTO Tal Chalozin On The New Normal of Digital Media

ScreenBytes Tal Chalozin YouTube Thumbnail

 

Flashback #3: Is Addressable TV Advertising Ready for Primetime?

 

Flashback #4: “Nielsen ONE” Intends To Be A Measurement For All

 

Video: Roku to Acquire Nielsen’s Advanced TV in a “Transformational” Moment for Television Advertising

Roku to Acquire Nielsen’s Advanced TV in a “Transformational” Moment for Television Advertising Thumbnail

Michael Beach

Michael Beach

Michael Beach is the Chief Executive Officer of Cross Screen Media, a media analytics and software company that enables marketers to plan, activate, and measure CTV and linear TV at the local level. Michael is also the founder and editor of State of the Screens, a weekly newsletter focused on video advertising that is a must-read for thought leaders in the advertising industry. He has appeared in such publications as PBS Frontline, The Wall Street Journal, The New York Times, Axios, CNBC and Bloomberg, and on NPR’s Planet Money podcast.

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