In May 2006, Greg Schaefer, the president/CEO of NCC Media, was flying home to New York from a New Orleans convention. Bob Riordan, the senior vp/ad sales at DirecTV, and an old friend of Schaefer’s, was sitting next to him. After exchanging insights on the convention, Riordan brought up an idea that some in the media world would have thought, to be kind, an extreme long shot: a collaboration between NCC, the nation’s largest spot cable ad sales organization, and DirecTV, one of the top satellite TV providers in the country.
“After he explained what was on his mind, I started thinking, ‘Hmm, cable and satellite playing in the same sandbox. This could be kind of interesting’,” recalls Schaefer. As it turns out, Schaefer was right.
In August 2008, NCC Media and DirecTV unveiled an ad sales and technology partnership involving select regional sports networks in nine major U.S. markets. The deal involved NCC integrating the feeds of these sports channels that would be offered to DirecTV customers in nine areas. Within those markets, NCC took on national spot sales for the satellite company.
At the time, Schaefer hailed the initiative as “terrific news for both local and national advertisers.” The end result of combining the satellite provider’s audience with NCC’s interconnects, he added, “expands our reach and strengthens our targeted offering. And ad agencies benefit from the single point of contact we will provide both locally and nationally.”
Fast forward to March of this year, and NCC Media and DirecTV are at it again. What was good for regional sports networks in 2008 apparently is good for all programming now.
On March 7, Schaefer and Riordan teamed up at another announcement ceremony. This time, the big news revolved around I+ (as in, Interconnect Plus), an ad sales tool that ties together NCC Media’s owners—Comcast, Time Warner Cable, and Cox Communications—with partners DirecTV, Verizon’s FiOS TV service, and AT&T U-verse. Whereas, before, NCC was only able to rep for cable, I+ enables local and national advertisers to add satellite and telecom customers to the mix.
“Our charter ever since I’ve been on board here in 2002 has been to make purchasing local multichannel television s seamless as possible for advertisers,”Schaefer says. “That’s exactly what this new I+ offering is all about. With FiOSand U-verse, there are new players in the marketplace. And at the same time there is new technology,which has enabled us and our owners and partners to bring this all together.”
One of those owners, Comcast, believes the addition of I+ will be of particular benefit in the southern and western regions of the country, which have a high percentage of households serviced by FiOS and U-verse.
“In places like Sacramento, Houston, Salt Lake City, and Nashville, our market penetration will see a nice increase,” observes Charlie Thurston, the president of Comcast Spotlight, the cable company’s ad sales division. “The interesting thing is that we’ve had the same strategy for years in that we’ve always tried to make the process easier and more beneficial for the advertisers. I+ extends that in a big way.”
The program was still going though final tests in mid-March leading up to the beginning of full rollouts in mid-2011 through early 2012. Once fully deployed, the addition of DirecTV, FiOS, and U-verse is expected to add about 11 million new homes to NCC penetration levels.
The infusion of the DirecTV homes alone is expected to have a huge impact on the kinds of audiences NCC can amass for advertisers. In the Phoenix area, for instance, DirecTV will add 32 percent to NCC’s reach. When the NCC-DirecTV link is up and running, NCC’s audience will also grow 31 percent in Dallas, 29 percent in Los Angeles, 29 percent in Denver, 25 percent in Houston, and 23 percent in Atlanta.
The satellite company, Schaefer explains, will be able to split its single feed in participating markets to create two-minute breaks for advertising that will take advantage of the latest in highly targeted, local advertising. With I+, DirecTV and its advertisers will be able to segment viewers to an unprecedented level.
“The main thing this does for us is it gives us the opportunity to participate in the local ad marketplace in a big way,” says Riordan.
DirecTV plans to use the system with 25 networks in 25 markets by next month, Riordan adds. If all goes well, that will expand to 50 networks in 50 markets by the end of the year.
The two telcos will be able to slice and dice their advertising messages even more, right down to the cable zone level, Comcast’s Thurston says. In a market like Philadelphia, for instance, there are 40-50 zones.
“This is the first big test of addressable technologies,” Thurston continues. “It allows us to carve up different geographies. And by having satellite, phone, and cable providers working together on the same foundation, I think we’re setting the stage for the national rollout of some of these advanced technologies in the future. We really think I+ is going to be a very important development in the sale of cable advertising.”
The end goal of I+ is to make it far easier for media buyers to get their clients’ messages embedded with cable TV programming, regardless of whether that content runs on a cable, satellite, or a telco system. But pulling it all together certainly wasn’t always easy. Even Schaefer, who genuinely seems to admire and respect all his partners in the venture, says it was not dissimilar to herding cats at the beginning.
“There was a hesitancy on both sides of the fence and it took a little while to get everyone to go along with it,” he admits. “But the reality of the situation is that if [DirecTV, FiOS, and U-verse] did it themselves, we’d just be working against each other. Now we can create a much more formidable offering to advertisers.”
Back in 2006, when Riordan first floated the concept to Riordan during their plane ride together, Riordan knew he was asking Schaefer to consider something that was, at the time, a bit taboo.
“I knew back then that something like this was technologically possible,” Riordan remembers. “The challenge was getting the satellite guys and the cable guys to work together. It was like working with frenemies. But we’ve developed a good working relationship with NCC and their owners and partners.”
For Schaefer, whose career included more than 25 years in broadcast ad sales on both the station and representation sides before joining NCC, the new I+ platform represents a watershed moment in his professional life.
“To me, this is revolutionary,” says Schaefer. “It’s the biggest thing to happen to local-market TV in the past 10 years. The only drawback to local cable was penetration. What this does is eliminate the biggest obstacle of local cable in the minds of advertisers.”