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Solving the Ad Tech Mystery

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Crunchyroll is addressing this challenge by starting to use SSAI. "[The] VAST [Video Ad Serving Template] 4 specification provided a much more robust set of heuristics that can be used to reduce the need to (previously) allow VPAID client-side executed code," says Dale. "With SSAI, we are able to support the latest spec compliance around server-side-inserted ads across many platforms at once."

The VAST 4.1 standard, released in November 2018, calls for the separation of the media file from executable code, the use of a mezzanine file to help with transcoding (and to support more devices/environments), the use of a UniversalAdId to identify assets (this would create a unique identifier, making it easier to track which ads have been played), direction regarding tracking, and standardized ad requests, among other recommendations.

"At Crunchyroll, product and business are always looking for innovative ways to monetize our freely-distributed anime catalog in a way that can support the animators while not presenting too large of an interruption of the fan experience," says Dale. "We recently rolled out the true[x] ad system that provides a mechanism for users to interact with ads in order to reduce the overall ad interruptions during playback." Other companies, like Hulu, use something similar to offer viewers a choice to watch a longer ad up front or to see midroll during a show. Ellation also started to use various versions of React Native Player within its multiplatform delivery to explore other interactive opportunities. 

Why Is SCTE So Important?

"One of the important things when it comes to ad insertion, on actually both [the] client and server side, is that you need clean cuts where you want ads to be stitched in. If you're not frame accurate, you will see glitches between the content and the ads," says Svensson. To be frame-accurate requires SCTE (Society of Cable Telecommunications Engineers) markers typically inserted by the playout and placed in the ingest manifest of the source stream to provide splice information that essentially says, "Start the ad here, and run the ad for this long." "VOD [video-on-demand] solutions could also rely on SCTE 35 cue messages, but usually it's a sidecar text file or some other automation system. It's not as standardized as for live," says Svensson. 

"Standards in general are important, whether they are from the IAB [Interactive Advertising Bureau], SVA [Streaming Video Alliance], SCTE, or other bodies. As the lines between traditional TV and digital video continue to blur, you have SCTE standards that were pioneered for traditional TV that are now starting to become relevant to digital," says Hock. "For example, SCTE 35, SCTE 130, and SCTE 224 are all applicable for this new world."

"SCTE-35 defines the ad markers in incoming streams today, and this is transitioning to a broader, deeper standard, SCTE-224, which provides a richer set of parameters for describing content and the markers for delineating ads and different types of content, says David Heppe, commercial general manager for targeted delivery at Imagine Communications. "SCTE-130 is a universally accepted protocol for communicating between DAI [dynamic ad insertion] components such as the manifest manipulator and the ad decision server (ADS), supplanting VAST, the legacy standard."

Ad Packaging and DRM

Once SCTE markers identify where ads go, then the ad will follow one of two workflows for ad repackaging, on-the-fly repackaging, or pre-fetching. On-the-fly repackaging takes the high-resolution MP4 or mezzanine file and transcodes it into the required resolutions and bitrates for the adaptive bitrate delivery for DASH and HTTP Live Streaming (HLS). 

Pre-fetching usually starts directly after the last ad break, so high volumes of viewers will not all make server requests to fetch their ads at the same time, according to Svensson. For some events, like live news events or sports overtime, even if you don't know the length of time for the ad break, you need to make an estimate or risk running into problems.

"Prefetching is the safer way to condition ads, as this ensures that the DASH / HLS files are already processed and available to the SSAI stitching," says Robert Seeliger, DAI and SSAI lead at Fraunhofer FOKUS. "On the fly transcoding is usually used when prefetching is not possible, e.g. if the actual ad creative is not available beforehand. To save storage costs and optimize workflows, today SSAI solutions mainly use CMAF as their content format, because this allows them to create DASH and HLS manifests based on the same content segments, at least when there are no specific DRM requirements given. 

"Scaling the manifest is on the other end [of packaging]," says Svensson. "So to say when the clients are fetching the playlists you need to ensure that your solution is coping with a lot of clients fetching the playlist."

"When the Ad Decision Service returns an ad, the manifest manipulator updates the manifest to be delivered to the client. The last important step is that beacons or verifications need to be sent back to the ADS to validate that the ad has indeed been watched—at least the first frame—in order to be counted for revenue back up the food chain," says Heppe. 

Is DRM needed? "There is no need for DRM in ad tech," says Seeliger, unless of course you're trying to support certain legacy systems like older connected TVs. "Those platform players don't like to mix unencrypted ad periods with encrypted content periods, [and] the result ends up stalling players and undesired playback behavior. So here applying a DRM workflow to all server-side stitched ads is the workaround to enable monetization on those platforms."

Fraud, Reporting, and Measurement

There are a couple of points where monitoring technology can determine that ad traffic is fraudulent. Large surges in audience size [can] be perceived as suspect, and so can taking too long to watch content. "For VOD we're running into validity timeouts for the ad tracking," says Svensson. "This means an ad is supposed to be tracked and reported within 30 minutes (from insertion), otherwise, it's considered not used. If you hit play, and then a short time later you hit pause and go for a lunch break and return to watch it an hour later you might have missed your validity time for that ad. So it means that if you have an insertion in there, you need to be able to extend the validity time." 

Getting More Personal

"The beauty of digital advertising is it inherently allows for targeting and personalization in a way that traditional linear advertising does not. Therefore anyone who leverages an ad-supported OTT platform is personalizing the ads," says Lexie Knauer, product marketing manager at Brightcove. "However, lack of demand can result in non-personalized ads or repetition of ads."

Who is doing interesting advertising? "Pluto TV has made an entire business on ad-supported OTT because they are able to execute extremely well. They provide cord cutters a traditional TV experience with a lighter ad load," says Knauer. "What Hulu has done with their interactive ad selector format is really cool. It facilitates personalization and engagement simultaneously." 

Behind the scenes, ongoing tracking is also important to ensure success. "One of the greatest challenges for ad tech today is providing a unified framework for the delivery, management, and invoicing of cross-platform campaigns," says Horowitz. "In most campaigns that are executed, the performance reporting happens at the end of the campaign. The data from these reports is used in the next round of planning. However, very seldom are mid-campaign checks taken and campaigns tweaked adjusting the campaign strategy and execution. These mid-flight checks can maximize performance significantly."

Going Forward

"Advertising puts yet another single point of failure in the [streaming tech stack]," says Svensson. "I talked to one of the vendors, they have Cricket in India and millions of users are going to the commercial break at the same time. This means that you need features like prefetching for this type of content or otherwise, it won't scale." 

The cross-department ownership of ad tech means planning becomes even more important. So what are the first steps for new services or features? "We generate a requirement weighting and scoring process. So once you do those two things you come up with a business perspective, and you have a list of items that you need from a vendor then you can generate an RFP if you're going through a full process," says Friend. "While every company wants to make more money, creating the right formula can mean the difference between success and failure for your business. Instead of chasing the latest trend, really examining the horizon and understanding the issues are important." This means having a critical understanding of all of your vendors' road maps and matching them to your company's exact requirements. The person or team in charge needs to filter all that information and make the right choices to determine a great strategy, says Friend.

SSAI, SCTE content prep, ad packaging, load testing, scale, interoperability, and personalization are all items that should be table stakes. YouTube right now is showing me advertisements for grass seed, when there's enough data floating around to know I live in a penthouse apartment in downtown Seattle and have no reason to grow a lawn. Hopefully, soon someone will get personalization right, and the service that does will win viewer market share and make ad-supported streaming really pay off.

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