Content delivery network Limelight Networks announced last week its new Limelight REACH Interactive platform which the company claims "helps publishers, agencies and advertisers create 'tappable' pre-roll and post-roll in-stream video ads, which open coordinated microsites." Read more.
Jonathan Cobb, GM and CTO of Limelight's Mobility and Monetization Group, discussed the announcement and its implications.
AdExchanger.com: Can you summarize what the Limelight opportunity is in digital advertising, or advertising in general?
JC: Limelight has many different things going on. The classic Limelight mission statement is, basically, that we want to transform people's digital experience and really give them new ways to live, work and play. From an advertising perspective, a lot of that comes into play from the entertainment side by how people play and experience the Internet.
My group, in mobility services, offers predominantly a publisher‑side solution for media companies that are serving video into mobile environments, and give them a number of options for how they can monetize that video. Either through advertising or through subscription, though the vast majority of our customers are offering their content for free and making it ad‑supported.
Limelight also owns Eyewonder in the rich media advertising space. They also have a large mobile component to what they do in addition to a huge array of ad units. On the content management side, we have the video platform solution, formerly Delve Networks which we acquired around a year ago. They provide a video content management system where you can add advertising capabilities by tying into existing networks, etc.
We have designed our products to interoperate well with other companies in the stack, in addition to our own.
What’s the value proposition for the publisher, in particular, with Limelight products and services?
What we want to provide publishers is the option to monetize their audience in a way that makes it easy. They can tie into their existing ad‑serving and ad‑trafficking systems that they may be using for the desktop web and extend that with no modifications. It's as much a workflow solution as it is a technology solution. You can use your existing ad server and all of that advertising that's going to your desktop web experience will now be going into your mobile experiences as well.
The value prop to a publisher is to easily extend the reach of the publisher's content and audience. And likewise, on the advertiser side, the value proposition would be, "Here's a way for you to easily reach audiences in a mobile environment, and you can use all of the same tools and creative tech that you're used to."
Thinking about some of the big challenges that you see on the publisher side right now as it relates to video, what are some of the trends you see there?
I think there are a few.
Number one is publishers are realizing that there is going to be continuing, endemic complexity in delivering into non‑traditional devices. In the mobile world, for example, even though it seems that H.264 is emerging as a standard video format, the way it is packaged varies widely from one platform to another. On a Blackberry, you need to package H.264 video into an RTSP stream. Apple supports adaptive bitrate with HTTP chunking, but the underlying format's the same. It's just the packaging is different. There's a lot of complexity there, and so even as things consolidate, IPTV is coming into the market and making things complex.
Another challenge we see from a trend perspective comes from the preponderance of ad networks that wanted to take risk.
The publishers weren’t as willing to jump in, and so they said, "OK, great, I don't have to do anything, ad networks will do everything for me." And then, as the market has matured and the ad networks have experienced success, publishers are starting to swing the pendulum back and say, "Well I want to be able to sell a certain amount of this inventory myself and capture premium rates."
What we're seeing in the ad exchange world is that other options are continuing to diversify and get more interesting. But there is also a swing towards the publisher wanting more control again. And, for whatever they are unable to sell themselves, they want to have every option they possibly can for how to monetize it. That's happening in mobile the same way it has in the desktop world.
What problem would you say Limelight REACH Interactive is solving in the mobile world?
The problem that REACH interactive is solving is actually a third issue in the mobile video space, which is the huge challenge around delivering advertising that moves beyond simple brand or display‑based video advertising and engages the audience, provides interactivity and offers analytics.
Right now, when you deliver mobile video into a device, it's very hard to say much about what happened other than it delivered. And so REACH Interactive is essentially a client‑side component that will run in an iOS or Android environment, and we may roll it out for other platforms in the future, but clearly there is massive traction around those two.
It allows you to create interactive ads, to measure that engagement and other metrics on interactivity and analytics. With REACH Interactive, you have pre‑rolls, mid‑rolls, post‑rolls that can allow the user a more immersive experience.
It's also incredibly lightweight, so you can embed it in any existing app. It adds less than 50 kilobytes of load. It's designed as well to embed in other SDKs, so there are folks that are producing various ad networks or other types of things where they'll be distributing iOS and Androids SDKs to developers.
If they want to include REACH Interactive functionality, it’s very easy.
Can you be any more specific about target market for REACH Interactive? Who's it built for?
Our core customer base are large media companies. Definitely, we are gearing towards our existing customer base. These are the NBCs, the CBSs, the FOXs, the Disneys and so on of the world. There's also an interesting play into the facilitator - the various application development companies that might be responsible for hundreds, or in some cases thousands, of applications, oftentimes focused on the media industry as a vertical. Partnering with those folks and getting them to adopt REACH Interactive as a standard solution for the thousands of apps they produce is a secondary market.
What do you see happening with video ad inventory in the next year or two?
I think you're going to see a few things. First, there’s going to be a lot more video. It's becoming more “normal” to watch videos on the phone. We see, in addition to the new publishers that we're turning up, organic growth amongst our existing publishers as more consumers are experiencing content and getting comfortable with watching video in their mobile environment.
But there are other vendors out there that ‑‑ and I'm not saying anything negative about them, but ‑‑ they offer more of a consumer‑grade service that is frankly a lot more affordable than ours and may not have all the bells and whistles. I think you're going to see a lot of folks that are just going to say, "Hey, I'm just targeting iOS and Android devices and I can't necessarily integrate advertising in all of the fancy ways that I'd like to. Maybe I can just do pre‑roll..." So, I think you'll see a glut of mobile inventory.
But that glut of mobile video inventory is going to be largely on the non‑premium side. Premium, quality content from larger brands that have good production value will do well and get better rates. You'll have the old long tail type of effect: there will be a ton more inventory, but a lot of it is not going to be premium or high-value.
Over time, there will be more standardization around, "What are those metrics that define audience and measure audience?" Do we try to extend them verbatim from the desktop web, or do we introduce new notions? And I think there will be some new one because mobility implies the ability to move around, and location‑based services mean a whole 'nother thing as IP addresses are basically meaningless in a mobile world.
At a very high level, lots more inventory, and new standardizations around metrics would be my guesses.
By John Ebbert