RICK WELDAY: AT&T has the opportunity to be the first fully integrated carrier in the United States. You’re taking a large MVPD, pay-TV provider and a scaled mobile and broadband business and bringing them together, and that’s unique. Today, we help advertisers place an ad based on interest or demographics in any one of 14 million households regardless of what they’re watching or when, whether it’s live or on playback.
It sounds simple, but it is transformational from a marketing perspective. My background, having purchased TV advertising in a number of jobs [Welday was formerly CMO for AT&T’s consumer business], buying was typically done on age and gender [and] GRPs and it was a big, giant hammer. Now it’s far more targeted, with [much less] waste and the ROI on it is incredibly compelling.
Would you say the added precision is coming from your mobile footprint?
When the DirecTV merger completed, we had 12 million addressable households. We’re now [at] nearly 14 million. For us to have grown addressable households by 2 million shows our commitment. Out of those 14 million homes, we can identify about 30 million devices that are associated and help marketers identify their target audience across them without sharing personally identifiable information.
Do you have a data management platform that would help you track consumer movement?
We have data coming from 35 million set-top boxes, so we have incredible first-party data capabilities. We have to have a deep technical ability and transparency with our clients about where and when the ads get placed. Clients are more interested in making sure the ad gets to their targeted audience, but we still share information about the content and day part where the ad fired. Usually the client connects their data to a safe haven, where we’d [also include] our inventory and see where there’s overlap. Then we’d render the ads. There’s a long list of people we partner with, like Experian, Acxiom, Kantar and Polk.
Where do you see the most opportunity for AT&T’s mobile data subscriber set? Will it, for instance, help close the loop between location, the in-store purchase and TV viewership?
Right now we’re not using data from our mobile customers, but we’re well aware of the opportunity for them to consume more video solutions and advertising within our developing video services. We’re very excited about our ability to monetize through advertising within our mobile base. How that evolves, there’s nothing further we’d forecast or announce right now.
Who is AT&T’s biggest competitor right now? Is it other telcos or are you keeping an eye on platforms with a large, logged-in user base like Facebook?
There’s no question Facebook and Google are competitors. There is no shortage of options for advertisers. Everybody knows a lot of money is moving to the digital space. I think, for us, when we look at where the growth is, it’s clearly going toward targeted, more audience-based advertising. Even in digital, growth is not riding on the backs of display or search advertising. It’s coming from mobile video. AT&T, having acquired DirecTV with the stated purpose of being an integrated carrier that specializes and leads and innovates in mobile video, that’s a good thing for us.
How involved is AT&T AdWorks in the video content and distribution discussion?
We’re very well coordinated inside AT&T around growth initiatives. (CEO) Randall Stephenson and John Stankey, the head of our entertainment group, recognize that advertising is a strategic priority for us. We’ve acknowledged publicly we’re building a common video architecture for the future, and you can imagine we’re coordinated with that for the addressable advertising that’s available.
We recently announced that the DirecTV app will include an addressable inventory capability, which is an example of an owned-and-operated, digital, mobile property that AT&T will include in our cross-screen initiative. We also [see] some 3.5 billion monthly digital impressions through our joint venture with Otter [Media, its joint venture with The Chernin Group that invests in video MCNs], so we feel really good about our scale, targeting and, frankly, the ROI of what we’re doing.
Interview edited for clarity and length.