OneScreen Offering Neutral, Third-Party Video Exchange Says CEO Patel

OneScreenAtul Patel is CEO of OneScreen, a technology platform that operates a video exchange for content producers, publishers/distributors, and advertisers. Where did the idea come from for OneScreen? And, what’s the name mean?

The idea of OneScreen came when we applied our insights from startups in lead generation and display advertising to the digital video space.  Both of these industries had developed technologies that integrate much of their respective ecosystems, such as lead management software and demand-side platforms, but the video space had only disparate applications, and in some sense, it still does.  It is obviously not easy to transfer what works in lead gen or display to video, because in video there are more stakeholders and more complex technologies involved.  But we are taking on this challenge at OneScreen by becoming the most integrated hub connecting the entire digital video ecosystem.

The name depicts a very critical trend that we saw early on.  The different screens that are in front of consumers – televisions, computers, portable devices, and place-based screens – are now or soon will be sourced digitally from the Internet making their distinctions less important.  The significance of this convergence includes the opportunity to cross-pollinate and integrate participants, business models, technologies, and even user-engagement.  To us, and I believe inevitably to all audiences, it will be “one screen” figuratively.

What problem is OneScreen solving?

When we first entered the video space I saw an economic model that was not optimal for any of the parties involved: content creators, advertisers, or publishers. Further, the industry lacked the cohesive technology framework necessary for these parties to seamlessly connect with each other.  OneScreen is solving these problems by enabling content owners to manage and syndicate their content with full control, publishers and distributors to obtain content rights and to publish video to their audiences in customized experiences, and advertisers to target video-based messaging to the right audience in the best possible context.  Not only do these three major constituents benefit from connecting with each other more openly and easily, the real winners are audiences which now have access to more quality video content wherever they are online and increasingly across all devices.

Traditional content distribution models are not transferrable to the digital channel because content owners require guaranteed revenue from publishers – analog dollars just don’t equate to digital pennies.  But this leads the distributors, namely web publishers, to choke on content costs, embed videos from third-parties with no revenue upside, turn to lower quality video content aggregation or creation, and even produce professional web content for which they are unlikely to recover their costs.   Consequently, advertisers and their video ad network partners have limited sources of ad inventory, restricting their spending in the online video channel.  Bottom line: nobody wins this way.

How does OneScreen differentiate from video ad network solutions in the marketplace?

We are not a video ad network. Rather, we are a neutral third-party exchange of content owners, publishers/distributors, and advertisers.  Unlike any other companies in the video ecosystem, OneScreen is the only company that brings together new distribution opportunities for quality content producers, total transparency and newest generation player/data technology to allow new inventory opportunities for publishers, and new branding opportunities for advertisers.  We are working with all major video ad networks, directly and indirectly, and continue to strengthen our integrations with each of them.

As a technology platform, we provide most of the applications and integrations.  For instance, publishers can skin our video player to the look and feel of their site, or with certain integrations, can use their own player.  Ad networks and advertisers can work with content owners and publishers on branded entertainment distribution or sponsorships that go beyond pre-rolls to include skins and take-overs.  Content owners can have their advertisers follow with their content through integrations to their ad server.   The opportunities are truly endless with the role we play in the marketplace.

What do you make of the recent M&A in the online video ad network arena?

Clearly, video has become a critical part of the advertising mix and is being taken seriously by all online advertising constituents.   However, I believe that those transactions are unique. The Tremor–Scanscout merger is focused on consolidation of volume and reach.  AOL’s acquisition of 5min is more important for AOL’s own properties than it is for syndication.  Specific Media and BBE both operate proprietary ad servers and focus on deep ties with ad agencies.  The Undertone-Jambo combination enables Undertone to provide in-banner video functionality to their core offering.  Adconion-Joost was an early move to leverage a video property and the technology behind it.

While the acquisitions to date make sense, one piece of advice that we give to display ad networks, content creators and content aggregators, publishers and publisher networks, is to avoid building, acquiring or exclusively signing with any video technology until you have a good grasp of all that it entails.  The world of online video is changing rapidly every day, from technologies to economics, making it more important to find the right partner to build and execute on a video strategy, to provide a comprehensive set of tools, and to enable you to differentiate your offering with affiliates and partners.

Is OneScreen in any similar M&A conversations?

It is important for OneScreen to stay independent because our goal is to continue to integrate and empower more of the ecosystem with our platform and build deep strategic relationships with all sources of content, audience, and advertising.  By serving as a neutral party in the market, we will be able to work with many of the existing players and new entrants in the video space  Further, OneScreen is quickly building presence across all Internet connected devices, including mobile, living room, and place-based screens, so the depth of our offering is still being measured.

Online video advertising often gets very healthy CPMs from the publisher’s perspective. Why, in your opinion, and will it last?

Consumers engage with video out of curiosity blurring performance measures, advertisers spend to experiment without attention to optimization and ROI, so scarcity alone builds demand and fuels the cycle.  However, as the format matures these exact reasons begin to implode, leaving it up to the market to counteract inevitable price declines.

While there are an increasing number of cases where advertisers do not pay high CPMs for their online video advertising, based on patterns we see at OneScreen, I believe that the format will continue to enjoy high CPMs overall in 2011.  Even as supply increases to meet demand, the industry constituents will usher in new capabilities, such as richer creative and integrated advertising and sponsorships, performance optimization, targeting options, and so on.  There is no way to stop the stabilization of price and, in fact, it is imperative for sustainability of the channel.  But because online video advertising translates to television advertising more easily than many other online advertising formats, advertisers and agencies will begin to move into online advertising in mass, giving publishers a decent runway with their high CPMs.

To be sure, there is NO substitute for sight, sound and motion (emotion) in helping drive brand awareness, perception and favorability.  Rich media and static banner/text etc. will simply never do it.  They can reinforce brand attributes, but not be the primary drivers.  That job is video’s alone. 

How addressable is video ad network inventory in general? And OneScreen’s, in particular?

Online video advertising is surprising addressable but the market has not yet taken full advantage .  Some of the video ad networks use site lists for targeting, some utilize video context, and yet others have started to explore data.  When volume is constrained, the easiest but not the most desirable way to deliver for advertisers is to use a site index with little transparency.  Sites are analogous to television channels so advertisers are accustomed to this type of targeting to the tune of $180 billion globally.  And with cookie targeting alone, you can have a highly targeted ad running in front of content not ideal for advertisers such as personal social media type user-generated content.

We believe that addressability will involve a balance of all these elements and that advertisers should buy against the intersection of sites, contexts, audience data, video experience (short form versus long form, banner versus section), and creative format (pre-roll, branded entertainment, sponsorships).  This was hard to do in the industry’s infancy, but with improving technologies and increasing volume, advertisers can begin to leverage all these aspects in their campaigns.  These targeting and creative options not only apply to the web, but we will begin to see similar models in television advertising with more addressable technologies coming to the linear  television market.  Do not expect an advertiser to completely ignore the channel, show, or actual content, simply to target households with a particular ad.

Do you expect real-time biddable inventory will become a larger part of the online video advertising world?

Yes, but not now.  Real-time bidding will become a big share of the online video advertising mix faster than it has for display because the industry can leverage the best practices and technologies already applied in display RTB.  It is important to note, however, that even display advertising real-time bidding has not reached the level of sophistication it can.  Most RTB buying methods today involve fixed-priced bidding against only a few variable inputs – such as site, category, context, size, user data, day-part, geography, and so forth – many of which are already common with non-RTB display buying.  Further, the creative is fairly static across all the permutations.

In contrast, bidding in video advertising can offer even more targeting inputs, including content metadata, content category, content owner, total length of content, video player size, companion banner and page integration options, and much more.  Additionally, creatives in video can be richer and more dynamic than display advertising.  We passionately believe that for an open marketplace in video to be successful for advertisers, the buying systems must account for the wealth of information about the content and publisher.  We are working with partners in the video advertising ecosystem to leverage this richer content and contextual data and to push the limits of creativity.

How does the volume of inventory available effect progress in the marketplace?

It is well known that there is a limited pool of video ad inventory available today against which to advertise.  It is highly possible that the audience you are seeking is frequenting a publisher that has no video content or is watching video to which you (the publisher and/or advertiser) do not have access.  The numbers speak for themselves.  According to comScore, U.S. online publisher sites delivered more than 417 billion display ad impressions in September 2010.   In the same month, the online video audience saw only 4.37 billion video ad impressions, a hundredth of the ad impressions in display.  This disparity must change first to scale online video advertising, much less RTB, and to attract more broadcast advertising dollars to the web.  Finally, it is important to note that integrated advertising, branded entertainment, brand sponsorships, and other more premium forms of advertising will be prevalent in the industry as more video finds its way to more publishers and their audiences.

How many employees today?  How is the company funded and are there any plans here?

We are privately funded and operate a lean company of 27 individuals skewed towards technology.  We expect to grow our team in the area of sales and technology throughout 2011.

A year from now, what are the milestones you would like OneScreen to have achieved?

The most critical milestone is for OneScreen to play a larger role in educating and uniting the industry to make it a much more open and valuable marketplace for all the constituents.  At OneScreen, we have been heads-down for some time building the technology so that it can truly encompass all that we have envisioned for the video space.  If we stay focused on our mission of democratizing digital video, OneScreen will continue to establish itself as the center of this ecosystem.

Follow OneScreen (@onescreen), Factual (@factual) and (@adexchanger) on Twitter.

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