AOL’s Phil Duffield on programmatic TV, Huffpo and transparency in digital

Phil DuffieldOnline giant AOL held one of the biggest presentation events seen at NewFronts this week. Head of advertising for AOL International Phil Duffield spoke with Nic Christensen on the future of programmatic TV, Huffpo Australia and why the programmatic transparency debate continues. 

What is your big issue in programmatic at the moment?

The biggest thing for us right now in programmatic is TV. It frustrates me. We have always been a big driver of this space and were the first company to launch a truly programmatic platform. 

What happens is you get a lot of companies who talk about programmatic TV and they are not talking about linear TV, they are are talking about over the top (OTT) or in-stream or connected TV, and that’s not programmatic TV. We are focused on premium automation and data.

For us that is the future of programmatic. For years people have been saying TV is dying and the reality is it isn’t. It is a strong medium and people get results from TV, they love it, they love the branding piece and we realise that as an organisation. We have therefore built a platform in Australia with MCN which has been adopted by most of the holding groups.

The key to making programmatic TV successful is data. We have been smart about strategy around data in the US. We have on-boarded a huge amount of data and we have enormous amounts of patents around how we treat data from a TV perspective.

In Australia, from a TV perspective the data is limited, but MCN are very invested in the data piece and their panels and we have partnered with them on this.

Where does it go from here in Australia from your perspective?

I know they have just announced that Ten is coming on Landmark. That’s the first step. Then, once their inventory is following through Landmark, adding it to the marketplace for programmatic TV is not that difficult. That becomes the end goal.

Compared with what you are seeing globally are we behind or ahead of the world on this? 

From an adoption perspective Australia is ahead but the US is catching up. There are a lot more companies from the programming side in the US, with CNBC, etc. Outside of the US and Australia, and in to Europe and other areas, it is challenging; which is down to data issues. Someone like ITV has been very slow to adopt programmatic across the board.

Australia and the US are definitely leading.

The Aussie TV networks have really recognised programmatic is important in the past year haven’t they? 

One hundred per cent. I think the AOL-MCN model has proven it is not about impacting the yield. MCN were smart in that they wanted to take share and they had a strategy and they implemented it and I think the other networks are looking at that and saying, “Wow, that’s market leading”.

It will be interesting to see what happens. I think the other networks are adopting programmatic TV but there is still a long way to go.

How soon until we can really target each household’s set of ads. You know, for example, give Lexus ads to a family in Mosman?

If you are talking about luxury car buyers in Mosman that’s something that can be done through the AOL platform but if you are talking about the other channels then it’s about ‘do we have the data to do that?’ Right now, do we have it? No because we have the OzTAM data but it’s not as in-depth as that.

It comes down to the networks and what they are collecting and how they are using that. If you look at MCN and what they are collecting with their panels they have been very smart and have been growing it because they know the future is about data driven advertising.

You would think that (all the TV networks) are looking at how they pull that data out and optimise it. The future is programmatic TV; that’s where the scale is. We have seen globally huge growth and we are now running into viewability and adblocking all this stuff but agencies and advertisers still want to invest in programmatic so where do we get the scale from? The obvious answer is linear TV.

What are the key highlights for you in the AOL NewFronts?

You’ll see that Tim Armstrong is talking about mobile and the big investments we have made. The acquisition of something like Millennial Media shows that mobile is the future and AOL has been vocal on being the number one mobile media company.

The reality is we have invested in Go90 and that is growing very rapidly. We are working very closely with Verizon around their mobile strategy and things like data are key for us and how we utilise that is key for us.

You will also have heard about content and what we are building. The reality is we are investing a lot of money in premium content. We are not about user-generated content (UGC). AOL is not about that. We have historically invested in premium content and we are going to continue to do that.

We believe as an organisation that premium content feeds our platform. If we are successful in that we will be successful, because if we do that then we start to tick certain boxes like viewability and audience boxes.

AOL is a global organisation now. Our footprint is global and extensive. What that has enabled us to do is more products and more platforms, more reach and different audiences.

What’s AOL’s view on the Australian launch of the Huffington Post? Are you happy with how that’s going? 

It has been very successful. The JV partnership model has been very successful. When you look at all the markets that Huffpo is in – and there are many many JV partnerships – the Fairfax partnership has been very successful to date. As long as it continues to do that we are happy.

Huffpo is an amazing brand. It is one of the most shared brands on Facebook. The content it produces is awesome and as that grows the AOL brand grows. Whatever the future holds, who knows? But right now the JV is a success.

Premium content requires a big investment, are you seeing a return now or is it a long-term thing? 

This is a long-term proposition. Producing premium content is expensive but the reality is that what we offer as a proposition in media platforms and content no one else does. With Google you get search, an ad network and YouTube, with Facebook you know what you are going to get. What we offer as an organisation is an opportunity across media platforms.

We are invested heavily in media, heavily in platforms and we will continue to invest in content. That is our unique selling position.

What do you make of the growing transparency in the US and elsewhere around programmatic? 

It is one of those never-ending conversations, isn’t it? AOL going back to the Adapt TV days. We have been very transparent around fees and inventory but the reality is there was a lot of arbitrage in the programmatic space. For us we have never arbitraged and we don’t. We provide technology platforms for our clients to access all the inventory sources.

We don’t have an issue with transparency but the industry as a whole does. It is frustrating because we shouldn’t be having this conversation; it should have been put to bed 12 months. When you are in a space where there is a tonne of money to be made you are always going to have the people looking to make more margin.

The problem we have is that there is such huge demand for programmatic video that physically there is not enough quality inventory. People are therefore able to arbitrage and charge a lot of money and make the margins.

Nic Christensen in New York


Get the latest media and marketing industry news (and views) direct to your inbox.

Sign up to the free Mumbrella newsletter now.



Sign up to our free daily update to get the latest in media and marketing.