Amazon’s rumored development of an ad-supported, free streaming media service, reported first by the Wall Street Journal Thursday, but subsequently denied by a company spokesperson, could solidify its relationship with FreeWheel.
FreeWheel is a video ad platform used by Comcast and Amazon among others. When Comcast announced its intent to acquire FreeWheel earlier this month, analysts and industry insiders wondered whether Amazon would continue using it.
After all, Comcast as parent company of the video ad server ultimately changes who controls data ownership around digital content management. With more players developing unique devices and set-top boxes (including Amazon's potential entry to that area as early as next week), owning the entire content distribution chain, ad serve and inventory is becoming increasingly viable.
Although a FreeWheel spokesperson said its relationship with current partners wouldn’t change, the possibility that Amazon is beefing up its streaming TV initiative could make FreeWheel a more integral partner.
Even before rumors broke of Amazon’s possible streaming TV service, the company was certainly looking to monetize video on the site. Lisa Utzschneider, VP of global advertising for Amazon Media Group, had confirmed to AdExchanger that Amazon was looking to place pre-roll ads or overlays on ecommerce ads. She also confirmed Amazon was integrating advertising into short-form content such as game or movie trailers and how-to videos.
However, developing video content is a very different discipline than placing video ads. If Amazon were to create its own streaming media service, it would need to distribute its video content as well and manage those digital assets.
This is why FreeWheel (or another solution, such as Adobe PrimeTime) might be crucial to Amazon going forward, should the Wall Street Journal report prove accurate: In addition to its ad-serving capabilities, FreeWheel offers publishers rights management.
Suggesting a hypothetical use case, if “FOX’s videos are being delivered to a Comcast subscriber who’s signed in to Hulu, who gets what portion of the inventory?” said Mark Trefgarne, CEO of programmatic video platform LiveRail. “It helps premium publishers with their revenue shares.”
He added FreeWheel has done a “fantastic job” of this and noted many of LiveRail’s largest customers “and certainly our best [brand] customers” essentially run FreeWheel as their ad server with LiveRail as their private exchange alongside it.
The reason for this? According to Trefgarne, it’s simply a matter of assembling an ad technology stack that runs effectively and is not necessarily an "either or" when it comes to picking a tool.
So what other companies, besides FreeWheel, could pose competition? Google, rumored once to be a FreeWheel suitor, actually has a competing platform in DoubleClick for Publishers Video. Trefgarne calls this “a very competent video solution.” But it’s unlikely that Amazon would want to partner with Google. As the owner of YouTube, Google would become an even stronger competitor if Amazon makes a push into streaming media.