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CBS targets the Internet

Cbs_logothumb Are TV networks starting to move at Internet speed? Mere months after braving its affiliates' wrath by putting college basketball playoff games online, CBS is jumping to the next level. The Eye Network (blog groundrule: use Variety and NY Post jargon wherever possible, conveying impression that studio execs take my calls) said today its evening news program would be broadcast online as well as over the air, starting Sept. 5 (the day Katie Couric takes over as anchor). It also announced plans this week to put primetime hits (and a few also-rans) online for free the morning after they're broadcast, and to leave them on the Web for at least four weeks. These are significant moves, and a firm rejection of the affiliates argument (baseless, in my mind) that online reruns cannibalize over-the-air broadcasts.

More interesting, though, is the statement by CBS Digital Media President Larry Kramer that the network may target the commercials that air with the online programs. Yes, it's hard for viewers to fast-forward past commercials in a streamed video from the Web, in sharp contrast to what viewers routinely do with TiVo and other time-shifting tools. But forcing people to watch commercials isn't the long-term solution to the ad-skipping challenge; matching ads to viewers' preferences is. The interactive advertising field is brimming with activity these days because the Internet and, increasingly, cable TV make it possible not only to direct ads to the viewers most likely to be interested, but also to measure their response. Several cable systems are deploying technologies by companies such as Visible World that insert different versions of a commercial for different zip-codes or blocks, modifying the pitch to match demographic data about the recipient. That way, a neighborhood bustling with children would get a different message than one shown to a downtown artists' enclave or a retirement community. Other techniques use input from the viewers themselves to shape what they see.

Online ads have been targeted almost since the Web came into being, and Google's technique for showing ads based on what a user searches for has basically allowed the company to print money. Companies like Lightningcast have been doing targeted ad insertion into audio and video streams for years, just not with programming as popular as "CSI: Crime Scene Investigation" or "Survivor." So it's about time that TV networks start exploring with advertisers how to put the commercials in front of right set of viewers. There a plenty of non-trivial issues to be worked out, starting with how to develop a broad inventory of advertisements and what mechanism to use to determine viewer preferences. CBS suggests that it will use information gleaned from viewers when they register, which could provide an elegant opt-in mechanism if it's not as bluntly intrusive, say, as the LA Times' online registration form. It's worth pondering, though, whether CBS' over-the-air partners will give it the flexibility needed to make ad targeting really successful. If GM wants to be seen with "CSI" online and off, does that mean people who really don't want to see car ads will have to watch car ads? Will the system for gauging preferences be that granular, and if so, will major advertisers play ball? Tim Hanlon, a senior vice president and new-media advertising guru at Publicis Groupe's Starcom MediaVest Group, thinks they will. Instead of paying for exclusive use of an ad slot seen by a huge, Nielsen-defined block of viewers (say, males 18-49), advertisers would rather share the slot and put their message in front of a smaller, better targeted group, Hanlon says. And ultimately, advertisers would like to buy the same targeted group across all delivery platforms -- broadcast, online, iPod, cell phone, whatever. There's a lot of work to be done to understand how TV programs fit into this model, but CBS, at least, is starting to do it.

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Times editorial writer Jon Healey pens opinion pieces about a variety of business issues, and blogs about technologies that are changing the entertainment industry's business model.

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