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Canoe Targets May for Ad Campaign

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LR Cable News Analysis
Light Reading
4/9/2009
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Canoe Ventures LLC , the cross-MSO advanced advertising firm, will begin to paddle out its first addressable ad campaign next month.

That's according to Canoe CEO David Verklin, a panelist at last week's cable show in Washington. Verklin and other cable brass were on hand for the "Economics of the New Advertising Era" session to address how the cable industry intends to preserve and expand its ad revenue base in an era of DVR ad-skipping and the growing use of "over-the-top" Web TV services.

Verklin wasted no time explaining what he’s been up to, announcing the launch in May of Canoe’s first “Community Addressable Messaging” project with the American Express Green and Gold cards. The ad project will target 18 million homes in 370 ad zones via a national ad buy that customizes the message depending on demographics -- the Gold card ad will be sent to upscale zones, and the Green card spot will be delivered to everybody else. [Ed note: Canoe recently clarified that American Express won't be among the initial advertisers for the addressable ad push. Verklin cited American Express as a potential example.]

Canoe, which intends to launch an interactive campaign later this year using Enhanced TV Binary Interchange Format (EBIF), has yet to reveal which programmers will participate in the initial addressable ad campaign. (See Canoe Rows Toward Enhanced TV .)

Verklin meanwhile outlined Canoe’s main opportunities as “addressability, interactivity, and data collection and knowledge.” He views interactivity as a way to bring new advertisers into the market, and even looks to convert traditional direct mail marketing tactics over to cable electronic platforms using request for information (RFI) capabilities.

MSOs also shed some light on their advanced ad activities. Stephen Burke, COO of Comcast Corp. (Nasdaq: CMCSA, CMCSK) and president of Comcast's cable division, said his company expects to outfit 10 million set-tops with EBIF capabilities by year's end. Comcast will use this initial installed base to get its interactive ad activities off the ground.

Time Warner Cable Inc. (NYSE: TWC) COO Landel Hobbs praised both EBIF and the more advanced tru2way platform for adding targeting and addressability to cable's advertising realm. Time Warner is using both to advertise and promote products and services to its installed customer base -- allowing customers to buy premium channels on-demand or to provision other services as needed. “We’re already doing interactive voting on New York 1,” said Hobbes of Time Warner Cable’s New York City area TV station.

Free isn't a business model
The business model for sharing enhanced advertising among MSOs and programmers is still a thorny one, one that represents a potential roadblock.

NBC has moved aggressively to get content online. Universal Television Group president and COO Jeff Gaspin said the media giant is aiming the strategy at viewers hooked into serialized dramas and comedy series, and to provide a place where consumers could go online to view missed episodes.

But not all programmers are following that strategy. David Levy, president of Turner Broadcasting Sales and president of Turner Sports, remarked that sports programming performs well on the Web, but more so as a complement (e.g., through supplemental interviews, profiles, and stats) to the live televised broadcast.

Discovery Communications Inc. (Nasdaq: DISCA, DISCB, DISCK) CEO David Zaslav reinforced what many other programmers said all week: that it's important “to protect the programming assets and the integrity of the business model." But he thinks viewer "authentication" might offer a rational way to solve the business issues as more and more TV fare makes its way to the Web.

Time Warner Cable is testing out the authentication concept with HBO in Wisconsin and may expand adoption when it fleshes out a broader Web TV strategy. (See TWC Scaling Up 'HBO on Broadband' and Cable Web TV: Results May Vary .)

— Patti Reali, Special to Cable Digital News

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