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Telcos and Cable MSOs In Focus For Digital Advertising In 2016

Internet advertising revenues reached a new milestone in the third quarter of 2015, as reported by two renowned research firms Interactive Advertising Bureau (IAB) and PwC US. According to the reports, Internet advertising revenues in the U.S. reached $15 billion, up 23% from the third quarter of 2014 and up 5% from second-quarter 2015. The research includes data concerning online advertising revenues from web sites, commercial online services, free e-mail providers, video streaming services and several other companies selling online advertising services.

With the use of social media and web search grasping the bigger slice of the pie, the Google division of Alphabet and Facebook command the online ad industry, closely followed by Twitter and Apple. However, as Business Insider reports, the fastest growing mobile ad format is display and video. This opportunity has lured telecom giants like Verizon and Comcast to step in and launch their own video streaming services. Verizon recently acquired AOL and Millennial Media to boost its streaming services while AOL took over Millennial Media to ramp up ad-based revenues. Likewise, Comcast acquired Freewheel and This Technology for its Internet TV services.

In the video streaming services segment, Verizon and Comcast have to compete against established players like Hulu, Netflix, and HBO. The history of failures in this market tranche like Qualcomm, MobiTV Inc. doesn’t paint a bright picture. While their acquisition and collaboration strategies will make them more competitive, time will tell whether these telecom operators can provide a resilient ad targeting platform to become a serious contender.

Source : Zacks

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