Hardware giant Roku – famous for developing hardware that lowered the barrier to TV streaming – has acquired Nielsen’s Advanced Video Advertising (AVA) business to solve the measurement issue in connected TV (CTV) and continue growing its ad spend share.
The move gives Roku a huge advantage in maturing the CTV ad market – although the rest of the sector will also be busy in 2021. The Drum takes a closer look at the strategic alliance with the media measurement firm.
Roku is strengthening its market-leading proposition by acquiring Nielsen’s Advanced Video Advertising (AVA) business. It comes bundled with tech that can identify and categorize video content and dynamically insert relevant ads into linear shows.
Roku made its name selling streaming hardware. Now, like Apple, it is software that generates the bulk of its revenue. It made $1.2bn from software revenue last year, largely driven by advertising.
While details of the deal are undisclosed, Axios says 100 Nielsen staff will join Roku.
Having already worked together for years, Nielsen’s Total Ad Ratings (TAR) will now run on Roku while Roku’s media sales and ad-buying platform, OneView, will natively integrate Nielsen ’always on’ Digital Ad Ratings (DAR) for advertisers. Nielsen’s Digital Content Ratings (DCR) will also be available.
Sean Cohan, Nielsen Global Media’s chief growth officer and international president, says the unit will ”remain an independent measurement company”.
Why the rush?
Media measurement has been lacking in CTV and marketers are at the experimentation stage with this new medium. Standards are still being developed.
CTV aligns broadcast TV advertising with systems digital marketers will be more familiar with. Ads can be tailored to viewers and their performance measured.
Roku says it has 50m active accounts, which translates to about the same number of customers shared by Sky (Europe) and Comcast (US) – although revenue per user and dwell time will likely be lower. Roku says it is available on 100m devices. In short, it now has the scale to develop a worthy platform.
”Tens of billions of dollars continue to be spent annually on traditional TV advertising,” said Louqman Parampath, vice-president of product management at Roku. It looks to bring the ”benefits of TV streaming advertising to traditional TV”.
Scott N Brown, general manager of audience measurement at Nielsen, says the deal will help ”accelerate the path to a single, deduplicated cross-media currency”.