As more television inventory becomes digital, it’s only a matter of time before the upfront, where the majority of national ad sales get done, becomes programmatic, said Dave Clark, general manager of FreeWheel, Comcast’s ad tech company.
“I think we’re seeing a shift in a major way this year,” Clark said, noting the growing amount of connected TV and addressable advertising the networks plan to sell. “It’s hard to say exactly how much we think it’s going to shift this year. But next year or the year after, we’ll look back at this year as the year it really kind of broke.”
Some parts of the upfront don’t fit the usual programmatic pattern, he conceded. Most programmatic transactions are designed to maximize the short-term prices of available inventory, while the upfront is designed to allow advertisers to reserve inventory early, getting lower prices in exchange for predictable revenue for the networks.
And some things can’t be automated. Price negotiations between six major agencies representing 200 clients and six big media companies won’t be “biddable,” Clark said.
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But once those handshakes are achieved, programmatic systems can execute those buys in a way that enhances the yield for sellers and effectiveness for buyers, according to Clark.
“That’s where the computer can be very, very helpful, driving value for both sides. There’s a lot of test and learn that needs to happen but the value is pretty clear so I think it’s inevitable.”
Some of that learning is already taking place, with networks setting up private marketplaces for advertisers that have already struck upfront deals.
FreeWheel, which handles ad insertions for most of the big TV companies, has designed a version of programmatic, called Premium Programmatic, that works for the upfront, Clark said.
In their May presentations, networks said buyers have expressed a wilingness to transact either by traditional insertion orders or via automated systems.
“There’s been a ton of interest in discussing setting up with us and using our technology to transact with our publishers,” he said.
NBCUniversal, also owned by Comcast, already uses FreeWheel to automate the ad decision-making for its broadcast and cable networks, noted Clark, who was one of the speakers at NBCU’s One 21 event highlighting advertising and technology. “NBC Is moving very aggressively,” he said.
