Cable Eyes Interactive Ad Platform

NEW YORK Comcast chairman and CEO Brian Roberts told investors Monday that cable operators have banded together to develop an interactive advertising platform designed to siphon off a greater share of the $290 billion U.S. ad market.

Speaking at the Merrill Lynch Media and Entertainment Conference in Marina del Rey, Calif., Roberts said that cable operators are working to develop “an interactive standard that we’ll all roll out together the same way we did with Docsis modems.”

The initiative is being developed under the auspices of CableLabs, the industry research consortium that is also chaired by Roberts.

Presently, the cable group is working on specifications and is in talks with advertisers, Roberts said. “This is a goal of the industry and I don’t think we’ve ever been able to say publicly, heretofore, that we’re working on this together,” he said. “This is a major priority for me that we try to get this done and executed.”

At the heart of the interactive advertising initiative is the perceived inequity of cable’s share of the overall revenue pile. “Of the $290 billion advertising business in this country, cable’s share is less than 10 percent,” Roberts said, adding that it’s up to the operators to work together to “chip away at that huge market opportunity.”

Though Roberts did not reveal details of the CableLabs project, the opportunity that cable can offer advertisers is the ability to target messaging to consumers by way of their digital set-top boxes. Set-top targeting would also allow for a much more measurable, quantifiable spend.

“Cable will aggregate the most eyeballs and therefore has the best potential in interactive advertising of any platform out there,” Roberts said. “If it works, we can have that aggregation effect whatever our video market share is, the way Google does in search.”

Though it will take a considerable amount of time and effort to build out a uniform ad platform, such a service would open up an entirely new revenue stream for operators, who would be able to pitch it directly to broadcasters. “If it’s a great monetization machine, value is going [to] the cable operator who has this technology,” Roberts said.

The first rollout of the new interactive advertising platform could happen as early as next year. Version 1.0 of CableLabs’ ITV standard, the Open Cable Application Platform, was introduced in 2001.

For Roberts, the sooner CableLabs can launch the new product, the faster Comcast can turn its ad sales business around. “One of the things that is a drag on our business this year, which I wish was not the case, is advertising sales. We’re having really the worst year we’ve had in maybe forever,” he said. “Local advertising is suffering and we want to do something about it—not just for next quarter or next year but something systemic and I think interactive advertising, and changing the value equation that cable is uniquely positioned to do, is one of our major goals.”