Interview with VeriSign’s Jeff Richards
Jul 10, 2007 8:00 AM
BE: Broadcasters until recently haven’t had much of a feedback loop, certainly nothing like IPTV or even cable can offer. Where do you see the opportunities for interactivity leading for broadcasters as they pursue Internet TV?
Jeff Richards: We have seen a huge surge in interactive TV. That market alone has gone from a market that didn’t exist to well over a $1 billion market. Just to give you a sense, 80 million people voted in the finals of “American Idol” last year. That’s more people than voted in the presidential election.
I would say the interactive TV notion of 10 years ago that you were going to sit there with your remote, click on a commercial for Cheez Whiz and order Cheez Whiz never really took hold, but the desire of consumers to participate in the show has absolutely taken off.
If you look at what we are doing across the mobile and broadband front, we are focusing on all three screens. It’s the home television, it’s the PC, and it’s the mobile phone. We think we have a pretty strong position across that scope. We think we have a stronger position than anybody else in the space.
BE: Doesn’t this same interactivity potentially offer new revenue streams to broadcasters?
Jeff Richards: There is a second component of interactivity beyond being a part of the show, and it is what is happening with broadcasters and advertisers. It’s no hidden secret that over the past few years, the advertisers have gone to the broadcasters and said, “We don’t necessarily like this traditional advertising model because we are paying you for a certain demographic of consumers who are now fast forwarding through the commercials. And the demographics we’ve historically gotten from third parties have always been a little suspect.”
It’s a very small sample set. The data isn’t exactly accurate. Some of it is manual. So they are looking at the Internet and saying, “Gee, with the Internet side of our advertising, we get extremely timely and detailed feedback. We know exactly what consumers are doing on the net. We can do demographic profiling by IP address.
So, I would say the biggest thing we are seeing happening across the interactive front, or we will see and certainly trying to push along, is the ability for the broadcaster or content distributor to offer a much more enriched advertising market for the advertiser.
BE: How?
Jeff Richards: What will happen is you as a consumer will establish your identity online, which will be secure, and you’ll be authorized as you go to these different sites. You will opt in if you choose to authorize certain sites to advertise toward you, and in return for that, you will get free content or discounted content — whatever the bargain may be.
What you’ll see is that these studios and content producers will be able to go to the advertisers with a much more targeted base of consumers and viewers. Rather than saying, “I can bring you 1 million households that have a viewer between the ages of 18 and 24,” they’ll now be able to go to an advertiser like Nike and say, “I can bring you 150,000 18 year-olds who already own a pair of Nike shoes.” So you are going to see this very targeted advertising world.
What you are seeing is the studios lining up and saying, “Gee, maybe that dollar that I used to get in the old world of advertising, which has now become 70 cents because I’m losing dollars to time shifting, I can now actually get back to a dollar or maybe even $1.20 because I am now delivering a much more valuable advertisement than I was previously.”
The click-through rates on advertising in the Internet video space are off the charts compared to what you would see in television or even a print ad.
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