Streaming Media and The Regional Advertising Challenge

Morris Berger

October 5, 2018

For many broadcasters, the promise of streaming to a global audience is bittersweet. Broadcasters all over the world can now connect with their diaspora communities and grow audiences globally via streaming platforms. However, many of these streams include audio ads that cater to a geographically local audience and often these ads are not relevant to distant listeners. For these stations, the diaspora audience presents an expense that is not offset by additional revenue. This is especially important given the rise in streaming media platforms. A recent article in the Akron Beacon Journal points to research from eMarketer regarding an increase in what many refer to as cord cutting. The article states that about 33 million people will cut cable from their lives this year and turn to alternative means of viewing content. From a TV standpoint, services such as Netflix, Hulu, Amazon and other alternate platforms such as DirecTV Now are benefiting.

Nielsen recently conducted a study and found that consumers are flocking to music. Streaming music is the most popular way to listen to favorite stations, artists and songs. Nielsen’s 2017 study revealed that 90 percent of the population listens to music and that, on an average, they do so 32.1 hours a week. That’s up from 86 percent in the prior annual study when listening time averaged 26.6 hours a week.

Generally speaking, broadcast advertising is usually sold through programmatic ad platforms, which match publishers’ metadata to advertisers’ metadata and instantaneously fill the inventory. However, if the content is foreign based and the publisher does not submit metadata for trafficking the ads, how would the programmatic platform have the ability to sell the ads?

According to the US News and World Report, nearly 50 million US residents hailed from outside the country’s borders and constituted more than 15 percent of the country’s population. In fact, as the number has grown, the demographics have shifted. While Mexico is still one of the largest sources of immigrants coming into the country, Asian countries are sending more people to the US than Canada, Cuba and Germany, according to United Nations data. Many of these people are harnessing the power of streaming media platforms to listen to their favorite hometown stations.

While listeners enjoy content from back home they are also subjected to hearing local ads from local communities. These ads are not relevant or contextual to their new lives and the regions they have chosen to live in. Beyond relevance, the publishers, agencies and advertisers are losing out on billions of ad impressions and revenues are not being funneled back to broadcasters. So, at the end of the day, nobody wins across the entire streaming media continuum and the user experience is lacking at best.

Technology should be put into play to help solve this challenge, improve the listener experience, add value to advertisers and drive additional revenues for broadcasters. Streaming technology should be built to detect and verify the ad being run from “back home” in any language. Then relevant inventory, based on the region the listener is streaming from, should be made available and filled via programmatic platforms. This would ensure that the listener is served relevant ads, the broadcaster back home shares in a higher Western CPM model and more inventory is available all around.

Morris Berger

Experienced executive focused on the convergence of technology, entertainment and content. Raised $500M+ in equity and debt for public and private entities. Managed the sale of companies of $1.5b+. Initiated IPO and sale of a public company.