Cox, NBCU Partnering on Dynamic Ad Insertion Trial

Cox Communications has begun kicking the tires on dynamic ad insertion, joining forces with NBC Universal in a test designed to assess the value of refreshing select VOD spots.

Positioning NBC’s The Office and USA Network’s Monk as a proving ground of sorts, Cox’ advertising services division will gauge audience reaction as well as certain technical processes necessary to enable successful dynamic insertion.

The trial is taking place in Cox’ Phoenix, Ariz., system, one of the operator’s largest. Up four ads and/or promos in both programs are to be refreshed several times per week, including pre-roll and interior breaks. Trick functionality is disabled during VOD spots; in other words, viewers will not be able to fast-forward through the ads.

Cox and NBCU said they’re working “closely with a large advertiser,” although neither company identified the client. Cox’ MyPrimetime VOD service provides on-demand access to popular programs the day after their original airdate.

“The capabilities for dynamic ad insertion have been proven and there is significant value for the entire cable and advertising ecosystem, something we expect to confirm during the current trial with NBC Universal,” said David Porter, vp of advertising product development, Cox Media. “Precise reporting metrics and the flexibility of dynamic ads make Cox MyPrimetime a powerful platform for our broadcast network partners to distribute their highest value programming.”

The Phoenix trial marks Cox’ second test of its dynamic ad insertion capabilities. Earlier this year, Cox ran a similar test with Travel Channel, in its Kansas footprint.

Last month, Comcast announced that it was revving up its own dynamic ad insertion efforts, positioning its Jacksonville, Fla., system as a test bed for real-time management of its VOD inventory.

On Tuesday, Oct. 13, the cable giant flipped the switch on an advanced ad platform developed by software vendor BlackArrow. In the early stages of the partnership, Comcast will use the BlackArrow technology to insert 15- and 30-second spots in free on-demand content from FEARnet and PBS Kids Sprout.

Until only recently, VOD spots were baked into the on-demand stream; in order to swap in new ads, the operator was obliged to re-encode the entire content file, a process that could take up to 60 days to complete. As such, the platform couldn’t accommodate time-sensitive creative like movie trailers and local sales promotions.  

The latency issue is one of the factors that has prevented VOD from becoming a meaningful generator of ad dollars. Per agency estimates, advanced advertising revenue adds up to around $140 million a year, a negligible sum compared to the $26.6 billion cable TV ad market.