Oh the irony. Cable operators have struggled for years trying to figure out how to use their own viewership data to better target TV advertising, with progress limited at best. Yet, with NBCUniversal under the Comcast umbrella, one of the most powerful companies in the world is now turning to cable for help with ad sales.
According to multiple news outlets, Apple Inc. (Nasdaq: AAPL) will outsource the advertising sales for its Apple News app to NBCUniversal LLC , starting in 2017. The deal is reportedly exclusive, giving the Comcast Corp. (Nasdaq: CMCSA, CMCSK) subsidiary control over all ad inventory not sold directly by publishers contributing to the app. Publishers, who used to receive only 70% of the revenue from their direct ad sales, will now receive 100%, according to The Wall Street Journal. For ads that NBCU sells, publishers will keep 70% of the income, while the other 30% is divided (split unknown) between NBCU and Apple.
Importantly, NBCU won't be granted access to Apple user data as part of the deal. Presumably, however, NBCU will bring its own broader consumer data to the table in the ad sales process.
There is no apples-to-apples comparison (pun intended) to be made between the type of ad sales that Comcast manages across its own media properties and the ad sales it will manage for Apple News. The two channels are very different. However, the win for NBCU does reflect a trend throughout Comcast of growing momentum in advertising. On the television front, Comcast has been one of the leaders in pushing dynamic ad insertion (DAI) for video-on-demand content, an initiative that has slowly but surely gained traction. In 2015, the cable-backed ad company Canoe Ventures LLC , which Comcast supports, served more than 11 billion ads into cable VOD services using its DAI platform. (See Canoe Serves Over 11B Viewed Ad Impressions.)
More to the point, Comcast Cable is now collaborating closely with NBCU to scale up its advertising business and maximize resources across the entire Comcast corporation. When Comcast acquired NBCU in 2011, it inherited not only new media properties, but also expertise and dedication to the ad business that Comcast alone didn't have. The company also brought in industry veteran Linda Yaccarino in 2011 to head up NBCU ad sales. Yaccarino has since led the way in initiatives like the combining of NBCU's broadcast, cable and digital assets into a single upfront sales process, as well as a strategic offering called Symphony, which unites the assets of NBCU and Comcast Cable for wide-reaching promotional campaigns.
From an Apple perspective, the new deal with NBCU is a sign that the consumer electronics giant recognizes its advertising weakness. From a Comcast and NBCU perspective, however, it's a signal that the cable media giant is serious about the ad business. And while Comcast may not be an advertising king like Facebook or Google (Nasdaq: GOOG), it does have one (ironic) advantage over those companies for a customer like Apple today: Comcast is less of a threat. At least for now.
— Mari Silbey, Senior Editor, Cable/Video, Light Reading