VIEQUES, PR – Imagine a future where the standard commercial load in one hour of video content is just five minutes. Where Facebook and YouTube have big subscription businesses reminiscent of traditional cable operators, and Netflix just might start selling ads.
These were among a variety of possible scenarios explored at the annual Beet.TV Executive Retreat during a one-on-one keynote session with Adam Shlachter of Publicis and Matt Spiegel of MediaLink. Among the agreed-upon certainties five years from now: 15- and 3-second ads will not be the predominant video ad units and gross rating points will be a currency, not the currency.
When YouTube launched its paid channels about four years ago, Shlachter, who was at Digitas at the time, viewed the company as a modern day MSO. “A vessel for programming, distribution, monetization and ultimately for audience,” is how he recalls it. While many people weren’t surprised that YouTube launched a premium subscription service, “That it exists now built into television sets or any device and any screen and it’s with you everywhere is something that I don’t think people were thinking about initially,” he said.
While both Facebook and YouTube have such massive audiences they cannot be ignored, “We’re also still trying to figure out the right way to engage with them,” particularly since their respective viewing experiences are so different, according to Shlachter.
Asked by Spiegel whether 15- and 30-second ads will dominate five years hence, Shlachter responded, “I hope not.” But he was skeptical about a headlong rush to reduced commercial loads wherein many units are transformed into content that could be more valuable to sellers.
“They have to figure out economically how to make that work,” Shlachter said, referring to companies like Fox. “We have to make the experience a little bit cleaner and we have to make it smarter.”
So why on earth would Netflix get into the advertising game? “Right now if you ask anyone they will tell you absolutely not because there’s no need,” he said. However, if net neutrality laws go in a certain direction and Netflix is taxed for its bandwidth consumption on different operators’ systems “maybe they have to look at alternative ways,” Shlachter added.
As for five minutes of commercials in one hour of content, he agreed it’s possible. In addition to ads taking different shapes in the next several years, cross-channel planning will see great advances along with closed-loop measurement models, according to Shlachter.
This video is part of a series produced at the Beet.TV Executive Retreat in Vieques. The event and series is presented by Videology and 605. For more videos from the series, please visit this page.