Dynamic Ad Insertion set to monetise Japan’s golden age of sport

By David Springall CTO of Yospace, and Yu Ishikawa, sales manager of ITOCHU Cable Systems

Japanese TV audiences are entering a golden period for live sports, starting with the World Athletic games this summer and the football World Cup next year, then the Japan-hosted 2019 Rugby World Cup and the Tokyo Summer Games in 2020. These events will no doubt drive a surge in the availability of live streaming services, driven not only by audience demand but also by the fact that Dynamic Ad Insertion (“DAI”) is transforming the online revenue opportunity for broadcasters.

In this article, we’ll look at the development of DAI in Europe: why advertising opened up in live channels is proving to be more valuable than across any other broadcast medium; and what this means for the future of television in Japan.

First of all, it is important to explain what we mean by dynamic ad insertion. For live streaming, it is the ability to deliver user-targeted advertising, with accurate cross-platform tracking, in a way that is seamless and frame-accurate for the viewer. Advertisement breaks from the original broadcast feed are replaced so smoothly that the viewer cannot tell a change has been made. In other words, ad breaks perfectly replicate the smoothness of TV.

It is because of this likeness to TV that dynamic ad insertion in live streaming has proved so popular with European broadcasters: viewers have been watching live TV with ad breaks every 10-15 minutes for decades. The online experience maintains this familiarity but benefits from advanced targeting and real-time ad tracking. We’ve seen viewers in Europe respond extremely well to this combination, with average view-through rates of advertisements typically over 95%.

The revenue opportunity becomes particularly potent for broadcasters with major sporting rights. At Yospace, we see an average viewing duration of 30 minutes per live stream, and more during a major sporting event. Our data shows that this equates to at least 12 previously unavailable ad spots being opened up per viewing session.

Across Europe last year, there was an eight-fold increase in available, addressable ad inventory created by performing DAI into live streaming. Japan is yet to deploy DAI in live channels at scale, but this will change in the next 12 months or so. With such large TV audiences, the untapped revenue potential is huge. And with two of the world’s biggest sporting events coming to Japan in the next few years, Rugby World Cup and Summer Games, the time is right.

Beyond sports, there is a substantial business case for using DAI long term. Over 60% of Yospace’s customers initially launched DAI for a major sports tournament. After the events, everyone kept it switched on, “24/7”, for day-today TV.

It’s not just the business case that needs consideration. The implementation needs addressing too, and for a long time there have been discussions over the benefit of client-side versus server-side ad stitching.

But when it comes to over-the-top (OTT), almost every broadcaster in Europe has chosen server-side. There are a number of reasons.

First is user experience: a well-implemented server-side solution is seamless and frame-accurate, with no disruption at all for viewers. In Yospace’s case, the advertising copy is conditioned to exactly match the content stream, resulting in a true TV-like experience for the viewer. Client-side stitching tends to lack the central control for the conditioning of advertising which introduces risk in terms of brand damage due to poor quality or inappropriate advertising being presented to the user. Client-side implementations tend to introduce buffering while the player loads ad content, which is hugely disruptive for the viewer, especially on a live channel.

Second is the minimal amount of maintenance required, due to the fact that a single stream, with ads already stitched in, can be delivered across multiple platforms/devices without complex changes to the software running on those devices. This is particularly good news for broadcasters’ app development teams who are constantly challenged in maintaining applications across a broad spectrum of devices. The server-side DAI technology acts as ‘middleware’ between the applications and the ad tech ecosystem, which is evolving rapidly. This approach provides broadcasters with the ability to take advantage of the rate of change with the way that online video advertising is bought and sold.

Third, server-side significantly reduces the threat of ad blockers. Ad blockers operate by blocking calls to known ad servers. Because ads are stitched in before the stream reaches the player, ad blockers do not see the ad call and therefore do not block the ad. Server-side stitching is supplemented by server-side impression beacons, which ensure accurate reporting of ad views across multiple platforms/devices.

Realistically, server-side is the only approach that works for DAI into live television viewed online, and the benefits are substantial. Broadcasters are able to combine an excellent and trusted user experience with the greatest benefits of digital advertising: targeting and analytics. This is an incredibly potent combination, especially when tested against premium live sport. With such a wealth of top-level sporting events on the horizon, Japanese broadcasters have a lot to look forward to.

This is an exciting period for online broadcasting, especially for Japan as it enters a golden period of sport. The most exciting thing is that the journey has only just begun.


Share Button