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This white paper has been written for executives at media publishing and content companies interested in learning about the exploding “non-streamed” or portable video market and finding out about best practices for driving revenue through advertising in this medium.
First, we need to describe the terminology we’ll use to explain different technology approaches to digital media. In the past, most consumers have viewed or listened to content on the Web via a live stream that is not stored locally and requires a live network connection at playback time. “Non-streamed” media encompasses video delivered to a variety of devices and platforms – via download or progressive download. Many use the term “downloadable media” as shorthand for non-streamed media, but in our view the term misses the essential consideration that, unlike streaming video, non-streamed media is not device-dependent – non-streamed media can be delivered to any device or platform given broad support for various media formats. Because what makes “non-streamed media” so different is both delivery method (download) and versatility (ability to be delivered to any platform or device,) we sometimes use the term portable media for clarity. As you will see in this white paper, we will usually employ the term “downloadable media” for simplicity, except where the term may cause misunderstanding. At those times we will use the term portable media.
In this document, we provide background on the evolution of digital audio and video, outline the opportunity that ad-supported downloadable media represents, and then provide a framework for identifying a comprehensive solution to making downloadable media advertising a robust revenue source.
After reviewing the white paper, the reader will have a concrete understanding of the challenges and opportunities of publishing ad-supported downloadable media as well as a context for identifying and evaluating the players involved in creating the solutions for ad management in this arena.
SUMMARY
One of the most profound changes in the media environment over the past decade has been consumer demand for content portability – an insistence that they be able to consume content whenever and wherever they please. In the digital media industry, these are often referred to as “consumer control” and/or “consumer assertion. “
A number of devices have been introduced that allow the consumer to be in control of when and where they will interact with their media, especially video media. This is a revolutionary change; no longer are consumers required to view video content at the time that network television and other publishing agents first make the content available.
A key consequence of this trend has been an explosion in multimedia devices including iPods, MP3 players, Portable Flash Players, PSPs, and media-enabled mobile phones. All of these devices transfer the capability to view professionally generated video content away from the television and away from the living room and shift it to other locations. But, again, location shifting generally requires that the consumer download the media they want rather than getting it streamed to them through a live connection.
Downloading, first made mainstream by web sites during the dial-up days, is now a well understood approach to consuming media. Content owners – movie studios and cable TV channels to name but two – have seen this growth and are scrambling to make as much of their content as possible available in this manner. But they also expect to earn revenue from downloadable media, especially through video advertising. They recognize that this opportunity encompasses, but goes beyond, PC-based downloading and viewing.
The great news is that marketers want these eyeballs – billions of impressions in which a consumer appears more likely to be paying attention to what they are watching than in the classic broadcast TV model. In fact, advertising in downloadable media is widely expected to be among the fastest growing sectors of digital advertising for the next several years.
The primary challenge facing advertisers in this environment is that when the content is viewed in an offline environment the traditional connection to the Internet is inaccessible and therefore the conduit through which to deliver targeted ads is also lost. For a company to successfully manage advertising in downloadable media they must follow one of two primary methodologies:
1. They can own the player environment where the content is viewed.
2. They can attach the advertising content prior to download and tie the ad to the content permanently.
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