TDG Opinions

"My Generation" Portends New Generation of "Dual-Screen" TV

"My Generation" Portends New Generation of "Dual-Screen" TV

Bill Niemeyer, Senior Analyst

September 24, 2010

ABC and Nielsen this week launched an iPad app that automatically detects and synchronizes to specific TV shows (in this case, "My Generation"), be it broadcast live or time-shifted from a DVR (an important feature, for sure). The solution uses audio watermarks from Nielsen that the iPad picks up via its microphone. Developed with Nielsen JV partner, Digimarc, these inaudible audio watermarks are already present in virtually every U.S. TV show, a feature that helps Nielsen gather data on its People Meter ratings boxes.

Using this same technology, Nielsen created a new service called "Media-Sync." The ABC/iPad app is the first public launch of this service, though Nielsen plans to make it available to other networks as well as extend its reach to mobile devices. Nielsen has yet to mention Android compatibility, though supporting Android is a de facto requirement if one wants to play in the mobile app space. Hmmm...think of how short the jump is from Android mobile phones to Android tablets, and ultimately to Google TV.

Nielsen's Media-Sync promises to automatically and tightly synchronize connected device apps to specific TV content without the need for operator cooperation (a feature that no doubt appeals to Google). True, interacting with TV shows may not have immediate widespread appeal, but that is hardly the most significant opportunity associated with this new technology: that lies in advertising and brand-sponsored apps. As Albert Cheng of ABC noted in this week's press release, "Together with Nielsen, we've created a sync-to-broadcast app that appeals to both fans and advertisers, and holds an array of possibilities for deeper engagement with our content and our advertisers' brands." As well, Media-Sync will prove useful to the auto industry, in which data collection for ratings and analytics is becoming increasingly relevant.

As TDG first discussed in June, TV networks would be able to launch a Google TV-related app that automatically syncs to a specific show or ads without the cooperation of operator-managed set top box, thus diminishing the need for operator deals beyond the one they have with DISH Network. Sure, there are other reasons for Google TV to do more operator deals (easier channel changing by the Google TV, detection of what's on the STB DVR, etc.), but this means Google does not need operator cooperation to offer enhanced engagement or targeted ads, or to accumulate metrics.

But wait: it gets more interesting. Such innovations could ultimately disintermediate Nielsen itself. A number of firms are working on fingerprinting TV content using lightweight client-side software that can detect a TV show or ad within seconds and quickly sync frame-by-frame (up to 30 frames a second) to a specific location within a show or ad via a cloud-based server. This is similar to what mobile app Shazam does for music (and which despite early success for music seems to have completely missed the similarly but sizably greater opportunity associated with TV). Such technologies can detect and sync not only without the permission of the PayTV operator, but without the permission of Nielsen. Others could insert watermarks into the same Nielsen-watermarked content (apparently a violation of FCC rules and cable carriage contracts, an item TDG is investigating).

One can imagine the tremendous opportunities associated with such powerful technology. Not surprisingly, it promises to create a great deal of value chain friction.

For one, sync-to-broadcast is not new, though it has yet to gain much traction. Over the past decade, several firms have promoted similar technologies, most frequently syncing PC apps with TV. Many of these firms are now gone (one at which I worked from 1999-2001, the VC-funded and now-departed Spiderdance), but it seems the technology has survived, only now getting its second breath.

So what's different now? The watermarking/fingerprinting systems available today enable auto detect and sync via lightweight client-side software. Coupled with the widespread availability of smartphones, tablets, and TV-connected devices to run the software (rather than relying on PCs or laptops), the requisite use cases are (and will become) more attractive to consumers.

Second, it remains to be determined how eager TV networks will be to disintermediate network operators. Yes, cable operators have been slow to roll out interactive technologies (and even now its chosen solution (EBIF) is not very capable) and ad targeting solutions (save for Cablevision). TV networks will need to balance (a) the benefits of deploying the advanced TV solutions that advertisers really want, versus (b) operator unhappiness surely to surface at carriage contract negotiation time. Cable networks will likely be more concerned about this issue than broadcast networks, although broadcast is definitely on the path to gain carriage fees (e.g., the recent Disney/ABC deal with Time Warner Cable).

Nonetheless, it looks like ABC has made that choice, deciding in favor of moving forward. As to other networks joining in, I'm reminded of a truism I picked up in the energy business: "Nobody wants to be first, but nobody wants to be third either."