Addressable TV: Your Viewing Habits as Political Assets

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Television has always been an important vehicle for political campaigning. The rise of television delivered through the internet has given campaigners new possibilities for political advertising and micro-targeting, customisable down to the individual viewer.

What is it?

Our television viewing habits have acquired valuable political currency due to changes in the delivery of TV content and the role of personal data in the process. Together, these two developments make internet-enabled television — commonly referred to as 'Advanced TV' — possible.

What you watch and what you read online have created many different opportunities for intelligence gathering and influence among political campaigns and special-interest groups who are keen on learning more about you. Data on your viewing and reading habits reveals a wealth of information about your preferences, interests, lifestyle and beliefs, all of which political entities can leverage in their campaigns.

The use of Advanced TV (sometimes marketed as Smart TV technology) in political intelligence gathering, and the deployment of that data via 'Advanced TV Targeting', or 'Addressable TV', is particularly interesting because the practice is not well-known and since most viewers are unaware of its existence.

Changes in TV Consumption & Advertising

As technology has evolved, our habits of media consumption have, too. The advertising industry today defines two types of television:

Linear TV (broadcast television or pushed content): follows a set schedule and includes preset commercial breaks. Linear TV content includes national cable network programmes and local TV networks. Someone who turns on her TV, explores the limited number of channels available, and tunes in to something that happens to be broadcast at that moment is consuming content in a linear fashion.

Advanced TV: Increasingly, TV is consumed via non-linear modes in which content is consumed more flexibly (on-demand or pulled content). Viewers choose what they want to watch, when and through what delivery mechanism. There is a wide range of mechanisms through which users can access OTT ('over-the-top') content, sidestepping traditional media controllers and distributers. All these services work by transporting content over the internet from a provider to a connected device outside of cable networks, telecoms and other closed networks. Examples include:

• Content consumed on mobile phones, tablets, and computers (e.g. Hulu, Netflix, Amazon Video, YouTube TV, mobile apps like WatchESPN)

• Smart and Connected TVs

• Set-top boxes (e.g. Roku, Apple TV)

• Gaming consoles (e.g. PlayStation, Xbox One)

The business models for these services range from subscription-based to pay-as-you-go.

Advanced TV enables campaigners to target advertisements with the same precision as those delivered over the internet, displayed on mobile phones and sent via snail mail. Advertising via Advanced TV – what the industry calls 'Addressable TV' – is the next generation of television advertising. Addressable TV allows ads to be targeted to specific households instead of indiscriminate demographics across whole cities or states, as with traditional TV advertising.

How relevant is it and where is it being used?

The freedom offered by non-linear modes of consumption has led to wide adoption of over-the-top devices around the world. The Interactive Advertising Bureau (IAB) reported that 56% of American consumers' TVs are IP-connected and that non-linear consumption is on the rise. In recent years, American business leaders have discussed expansion opportunities for Addressable TV outside of the US.

Liberty Global, a company that claims to be the largest international cable company, has started rolling out set-top boxes to its markets globally, including in Austria, Belgium, the Czech Republic, Chile, Germany, Hungary, the Netherlands, Poland, Romania, Slovakia, Puerto Rico and the UK.¹

Related internet-enabled TV services have also been introduced in Bosnia and Herzegovina, Bulgaria, Canada, China, Colombia, Croatia, Denmark, the Dominican Republic, El Salvador, Estonia, Finland, Georgia, Greece, Guatemala, Honduras, Iceland, India, Kazakhstan, Latvia, Lithuania, Macedonia, Malaysia, Moldova, Mongolia, Montenegro, Nicaragua, Norway, Pakistan, the Philippines, Serbia, Slovenia, Sri Lanka, Sweden, Turkey and Uzbekistan.

Experts forecast that internet-enabled TV will expand most rapidly in the Asia Pacific region, the Middle East and Latin America, where the bulk of subscriber growth will likely take place. The global market is growing at an unprecedented rate and is expected to reach nearly $80 billion by 2020 and about $117 billion by 2025 due to skyrocketing demand.

The advertising opportunities have, in turn, burgeoned dramatically. Advertising "spend in OTT is expected to hit $40 billion by 2020" according to the IAB. Data from all of these set-top boxes can generate new data sets and enrich existing data from other sources, which may in turn catch the interest of political campaigns outside of the US. Companies have an incentive to whet campaigns' interest in addressable advertising. As Warren Schlichting, senior VP of Media Sales at Dish Network commented, "Political spending is a rapidly growing market, and this allows us to go after new money."

How does it work and how is your data used?

The data that can be collected from Advanced TV viewership has created new opportunities for advertisers, whose work is fuelled by data. As Brian Gleason, CEO of the global digital media company Xasis, stated, "Voter data is the lifeblood of political advertising...By bringing this data into the digital space, we’re opening up an entirely new level of sophistication for political marketers...”

The next generation of TV advertisements are called "addressable" because advertisers now more than ever have both the information and the technology available to address the needs and wants of individual users. Addressable TV ad targeting can occur in different modes (linear/live, playback, or on-demand), through set top boxes, cable, or IPTV (short for internet protocol TV, the delivery of TV content over the internet).

People are calling for the end of big data, but set top box viewing data combined with voter data gives accurate and real insights into what targeted voters are watching. - Tim Kay, NCC Media's Director of Political Strategy

Advanced TV achieves individual household-level precision by collecting and analysing data on its users. The data involved comes from three sources:

• First-party data: In-house data that the advertiser has collected on you. This may include, for instance, which commercials you've watched and which you've fast-forwarded through or whether you're more amenable to image or text-heavy advertisements.
  
• Second-party data: Second-party data encompasses information from partnerships and affiliates in which data is shared (see Case Study: D2 Media Sales).
  
• Third-party data: Data purchased from a separate source (e.g., Acxiom, Experian, LiveRamp, Neustar or others that specialise in political data). This information ranges widely, but in political contexts usually includes how persuadable you are and how likely you are to show up at the ballot box.

All of this personal, demographic, geographic and behavioural data is aggregated and analysed in determining whether you are a good candidate for an advertisement and in evaluating how you respond to it.

As Experian advertises in its white paper on Addressable TV, "Addressable TV is about the person and not the program. You and your next door neighbour may be watching the same show, but through the power of Addressable TV, end up viewing different ads." The paper's tagline is: "Harness the power of audience data for one-to-one targeting."

Cablevision's CEO Ben Tatta shed light on political campaigns' use of Addressable TV in this clip recorded in April 2016.

Case Study: D2 Media Sales

In 2014, Dish Network, an American satellite TV company, and DIRECTV, an AT&T subsidiary, partnered to form D2 Media Sales, which was then the "largest household addressable TV advertising platform" in the US. D2 Media's advertising platform delivers addressable ads to nearly 22 million households. The company forged partnerships with data providers across both major American political parties including i360, which services Republican campaigns, and TargetSmart, which caters to centre-left candidates. In 2016, D2 Media provided addressable TV ads to over 100 political campaigns.

D2 Media Sales also maintains a partnership with Deep Root Analytics, an American media analytics company that caters to Republican campaigns.

Case Study: Altice Media Solutions

Altice Media Solutions, a digital advertising company whose clients range from Fortune 500 companies to local businesses, also offers Addressable TV advertising services to political campaigns.

Is it new?

Though the term "Advanced TV Targeting" was first introduced in 1990 at the MIT Media Lab, it wasn't until recently that the practice gained momentum. Three factors came together to facilitate the adoption of Addressable TV advertising: the 2016 American election cycle and the search for a competitive advantage; the technological infrastructure and advancement of advertising agency capabilities; and – perhaps a longer-term trend – the "consolidation of the media industry." As the amount of content sent over IP, OTT and on-demand platforms reached a critical mass, Addressable TV became a viable option for political strategists. In fact, according to D2 Media Sales, the "2016 presidential election cycle [was] the first [presidential] one in which campaigns have been able to target voters with addressable television advertising." Between the 2014 and 2016 American election cycles, the use of addressable TV increased about 60%.

Why should we care?

While companies offering Addressable TV services claim that it can strengthen the democratic process by improving the efficiency of political campaigns and by fostering political participation, it also introduces risks. In fact, both Germany and the Netherlands have recognized the sensitivity of personal information processed by Advanced TV and have introduced the right to watch anonyously among other enforcement actions. While local regulations differ, the generally wide gap between media practices and data protections presents a host of concerns.

Proponents of Addressable TV advertising tout the ability to display different ads to neighbours living on the same street. While this technology may be advantageous for selling some goods and services, the costs of this personalisation in political campaigning are different. Household-level targeting of political ads can easily lead to the erosion of the public sphere, as individual voters may understand candidates and their campaigns differently based on the information they've been fed. In addition, "During most of a campaign, you want to target persuadable voters," as HaystaqDNA CEO Ken Strasma stated. As a result, some voters who are believed to be unpersuadable may be neglected entirely if political campaigns deem them an unproductive use of campaign resources.

Furthermore, the advertisements served to individual households reflect the campaign's understanding of individuals living in those homes, knowledge that can be acquired through invasive or privacy-compromising means. When voters are included in an advertising campaign, addressable advertising is symbolic of "a shift from identifying groups to identifying people," as president and CEO of digital media agency Bully Pulpit Interactive remarked. Moreover, advertisers' data on individual households — whether directly observed or predicted — may be inaccurate or outdated, leading to political profiles and advertising campaigns unfit (at best) or outright damaging (at worst) for voters.

Additionally, most TV watchers do not consider the fact that their viewing habits and preferences can be – and are – used to shape how political campaigns communicate with and persuade them. Perhaps that would make a good TV show itself, but what would watching it reveal about you?

Varoon Bashyakarla is a data scientist and researcher at the Tactical Technology Collective. His past statistical undertakings led him to a variety of domains: public health, public safety, sports, finance, and cybersecurity. After working as a data scientist in Silicon Valley, he is now living in Berlin and exploring how personal information is used for political influence.

_{1 Liberty Global's Q4 statements reflected a nearly 200% increase in revenue from Latin America and the Caribbean, which drove its stock price up over 15% in a single day. The company gained nearly 100,000 new customers in Latin America and the Caribbean in 2016 alone.↩}

Thank you to Christy Lange, Stephanie Hankey, Amber Macintyre, and Daisy Kidd for their discerning comments. A big thank you to Gary Wright for his technical assistance posting this piece online.

_{Published June 18, 2018.}