Videology’s Ferber: Hammering TV With Digital RTB Tactics (Alone) Will Not Unlock Dollars

ScottFerberVideology has been described as everything from a demand-side platform to publisher ad server to – claws out – your run-of-the-mill ad network.

But Scott Ferber, Videology’s chairman and CEO, and a co-founder of Advertising.com, said there’s only one piece of truth to the "network" part: that Videology creates “private video networks” for media companies like Yahoo Japan and delivers audience guarantees and data targeting for advertisers. Additionally, a number of agencies like Mediahub/Mullen have “standardized” on its self-serve platform.

In recent months, Videology, whose core business is video advertising, applied Nielsen Cross-Platform Homes Panel and TV audience data to beef up a TV Amplifer tool it launched in 2012. Last year, more than 25% of Videology’s campaign RFPs included requests for cross-screen planning and buying, which spurred the initial development of Amplifier and subsequent data add-ons.

In late October, Videology formally launched a TV practice, appointing five key executives to spearhead the new development, at the basis of which is the growing confluence of digital and TV ad dollars.

Ferber spoke with AdExchanger about these developments.

AdExchanger: Why the development of a TV practice?

SCOTT FERBER: We’ve been offering tools to help clients efficiently plan, buy and sell advertising across screens. These tools facilitate the best use of television dollars across all screens, and informed cross-screen planning leads to improved reach, awareness and recall and that pushes product off shelves. The key to this is our direct integration with Nielsen and other data providers that allow us to measure campaign performance across devices using a common set of metrics.

We launched our TV practice to move our television initiatives forward in a faster, more strategic way by putting a specialized, dedicated staff of television experts behind them. The global team crosses multiple divisions, from sales to product development.

You’re among the last “remaining” private video ad tech companies. What are your revenues now and what percent of that is licensed vs. managed?

We’ll do $300 million this year in revenue and did over $200 million last year, so we’re at over 100% compound annual growth rate. Eighty percent of our business is a platform/ tech licensing business. Twenty percent of our business globally is media. There’s two ways you can license tech. You can have your clients do everything by themselves or you can do everything for them or something in between. All of our tech licensees do a combination of self and/or partially managed services. But we still need a media business to help them with liquidity.

Are you an ad network?

I say we’re the ad network killer. We give people portfolio optimization capabilities specifically to manage private video networks. From our perspective, though, of course you have to service the managed side. They’re participants in the ecosystem. If you favor [one side – supply or demand] it breeds distrust from the other side in working with you.

So you’re not into this whole idea that you can’t serve two masters? Some folks would argue focusing on one side keeps the other accountable.

One of my biggest frustrations is there are a lot of companies who are trying to say they’re not in the media business, they’re not a network and they don’t service demand and supply. The reality is everyone who’s in this industry space, every company who says they’re supply-side oriented has to service the demand side and every company that’s demand-side oriented has to service the supply side. You will fail if you think your only client is only one of those two sides. That’s a misconception that they are one-sided in the equation because everyone who is successful has to do both of those. To be very clear, I don’t understand the issue, when all of us need to service an ecosystem, why there is an artificial distinction made on media and networks when everyone has a media proposition. You have to create liquidity in the marketplace. You have to be able to source media. It’s a part of the business. This is nothing new and people are trying to put their own spin on something old.

So are you an ad server, a DSP, an SSP or an exchange? Or is it some mix of everything?

We have a video ad server. We have a yield management system. Our differentiation is that the ability to run a portfolio of campaigns against media placements is a huge yield management math problem. TV works differently than RTB, so the current SSP models are not correct from display to video. We run yield management technology for the demand and the supply side. Is that a DSP? Is that an SSP? Yes, but not the way they’re defined by digital. It’s about building private video networks and that means you got to have a supply- [and] demand-side capability and ad server. We are not a publisher ad server media rights management company like FreeWheel. They’re amazing at what they do. Love them. We are not in the business of being a publisher or advertiser ad server in the way DFA, DFP or Vindico are set up.

What do the video SSP acquisitions of late indicate to you?

I would put Facebook buying LiveRail on the digital side, and Comcast on the traditional side (and they’re huge in digital, don’t get me wrong) but the fact that they’re 80% TV and their history, and they bought FreeWheel. If you think about that, holy cow, there are a lot of companies between media companies, multivideo production distributors, cable companies and satellite operators and telephone companies, agencies, brands [that want to get into video]. So many entities. And then all of the tech providers for enterprise software, SAP, Oracle, IBM and Intel, and those companies will be intersecting in some shape or form with the future of video.

There’s one caveat, though. Who’s left to buy?

The flip side is, there are not that many companies out there – I’m talking pure-play, supply-side tech folk with reasonable scale. There are a lot of display companies trying to do video, but I think it’s such a big industry and opportunity and the differences in display and video are so vast that if you truly want to go across the holy grail of TV money, you’re going to have to take a very TV-centric approach to it. Just applying the RTB digital hammer by itself will not work.

In many ways, you’re seeing traditional publishers and media companies create new sources of supply, like RTL Group did with StyleHaul.

In Japan, the newspapers own the television broadcasters. Japan is the second largest TV market in the world. Here, the newspapers for ownership reasons couldn’t make that happen. They’re not that strong economically because the media landscape changed. I think companies need to be like National Geographic, which has a great print magazine, but while print is great, they realized they could make a franchise on TV and now they’re one of the top five cable networks. That’s where the future is, and it’s simply the domination of money in the sight, sound and motion.

Videology is the latest installment in a series of interviews examining different vendors in the video ads ecosystem. Other players have included: BrightRollOoyalaSpotXchange and Innovid

 

 

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