Not Ready for Prime Time: VOD Digital Ad Insertion's Delay

Although the technology’s ready and raring to go, it’s unlikely operators will offer clients the option of digital ad insertion in VOD streams in ’05. Comcast anticipated using the model to take in incremental revenue from on-demand services as early as next year, but it appears unlikely. The leading vendor in the arena SeaChange believes the project will be a work in progress for 18 months. SeaChange dir of broadband systems Joseph Ambeault says while the integration of its VOD server product and digital ad insertion system is complete, questions about how cable and ad clients will use the technology remain unanswered. "It’s a learning process," Ambeault says. "We have the VOD part down, where to splice the stream, but there are only the most rudimentary pieces of the business system in place." While SeaChange isn’t at liberty to disclose which markets are testing its gear, CEO Bill Styslinger let at least 1 cat out of the bag during a 1Q earnings call in May, when he said VOD ad insertion field trials "start in the next couple of weeks in Philadelphia." (Comcast did not elect to provide further information on the Philly trial, or to verify if other trials with nCube and Concurrent were underway, although tech redundancy is standard operating procedure in cable systems. Comcast did not provide comment on a hard-and-fast rollout date for the service.) Ambeault says SeaChange is streamlining operations "to get the work flow near to nothing by taking out a few steps." While corporate culture may need to be shaken up-"ad sales people are beginning to see the VOD server as another vast opportunity," he says-things are being "quietly worked out" between ops and the Madison Ave crowd.