Analysts Continue Comments on YouTube TV; No ‘Massive Transformation’ Yet15 Mar, 2017 By: Doug McPherson
MENLO PARK, Calif. – YouTube’s foray into live TV continues to garner analysts’ thoughts.
Many see a TV ad model reinvigorated with deep data and technology that lets marketers pitch with one-to-one targeting. YouTube owner Google sees it that way: “Over time, YouTube TV will provide network partners with new dynamic advertising opportunities,” a Google spokeswoman said.
Dave Morgan, CEO at TV ad targeting company Simulmedia, told Advertising Age that he doesn’t see “any kind of massive transformation to the core model. This is about digital conforming to TV versus changing TV. There will be incremental changes, but not revolutionary.”
Morgan predicts streaming pay-TV services will work within the confines of the traditional TV ad model for at least the next five years.
MediaPost News columnist Steve Sternberg says YouTube TV is entering a space that is getting more crowded, but is by no means saturated, citing Sling’s (Dish Network) 1-million-plus subscribers; DirecTV Now’s (AT&T) 200,000-plus subscribers; and Playstation Vue’s (Sony) 100,000 subscribers. And Hulu (jointly owned by Disney, Comcast, 21st Century Fox, and Time Warner) will soon launch its own live streaming service.
“I find it hard to believe YouTube won’t increase the number of channels offered and raise the price for an expanded package at some point,” Sternberg writes. “I would think YouTube TV is not designed as much for cord-cutters – although I’m sure they want them too – as for young consumers who are getting their own TV package for the first time, and are already heavy YouTube users.”
Some reports last week said YouTube TV would sell the two minutes of commercial time per hour that is sold by traditional cable and satellite carriers, but a spokeswoman confirmed that’s not true. The networks will retain that commercial time to sell along with the rest of the ad time in their programs. Commercials that air during the programming watched through the $35-per-month service will mimic those that air on traditional cable and satellite operators.
As for Hulu, Peter Naylor, senior vice president, advertising sales, told Advertising Age that revamping the live TV ad model is less a focus than increasingly popular on-demand viewing. While Hulu’s forthcoming service will sell the two minutes of commercial time that are also sold by traditional operators, Naylor said “the live stream itself won’t be dramatically different.”
Hulu’s plan is to offer consumers one interface that pulls together the live, on-demand, and recorded viewing that consumers currently spread across a variety of platforms and devices.