WarnerMedia Makes SVOD Case to Advertisers
Almost a year after its $85 billion acquisition of Time Warner and less than six months until beta launch of its Warner-fuelled streaming service, AT&T has doubled down on its proposition in a bid to whip up ad dollars.
At its upfront in New York Wednesday, company execs promoted the combination of content assets from the Warner stable with the telco's existing 170 million North American direct-to-consumer (DTC) relationships.
"We've combined the creative vision, iconic brands, and full content portfolio of WarnerMedia with the global reach, capabilities and direct consumer relationships of AT&T," John Stankey, CEO, WarnerMedia told marketers and ad agencies. "It means we've streamlined our business to ensure that all of our audiences and platforms are available to you—in one place."
The company knows it has to hit the ground running with the ad-supported, DTC product, which launches head to head not only with Netflix but Disney+, AppleTV+, and NBCU's subscription video-on-demand (SVOD) service.
"We all know video consumption is changing," Stankey added. "Technology is changing. And our business models are changing. But the need to connect with passionate consumers at scale is not changing."
WarnerMedia's chief argument is that while consumers will be attracted to content from HBO and Warner Bros. as well as Turner subsidiaries such as Adult Swim, The CW, and Cartoon Network, advertisers can connect with those audiences via AT&T's massive reach and leverage insights from inhouse analytics division Xandr.
It announced that Xandr has launched an ad marketplace, called Community, intended to connect advertisers with "hard-to-reach" audiences whose content consumption has fragmented across platforms, including TV, mobile, connected TV, and OTT.
The pitch to advertisers is that they can define audiences and identify households, and then serve relevant ads to the desired group across screens.
AT&T hopes this will help advertisers reach audiences who are watching fewer ad-supported programs by building out Xandr on its database of 170 million AT&T customers.
"When we introduce our new WarnerMedia service early next year, you'll see not only a very attractive new alternative in the SVOD marketplace," said Donna Speciale, president of ad sales, WarnerMedia. "You'll see a more integrated approach. The addition of our new streaming connection to the consumer, plus each of our networks' distinct assets, distinct audience profiles, and massive reach—all working together—will be an equation few, if any, will be able to match."
Exclusive content remains a crucial driver of uptake and a key differentiator for SVOD entrants,
And WarnerMedia signalled further spend on content origination including fresh drama coming to TBS. The group made a reported $100 million this year alone from licensing Friends to Netflix, but will forgo that revenue when it pulls the series along with other content from distribution on its rival.
The as-yet-unnamed SVOD service is planned to roll out beginning in 2020, first in the U.S. and then globally.
WarnerMedia's portfolio of content brands (ranging from CNN to Adult Swim via Turner Sports) reaches over 3 in 4 Americans every month across all platforms, with 1.2 billion followers on social media. Such brands collectively generate 1.3 billion hours of engagement and reach 239 million unique viewers each month, the company said.
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