Smart TVs - Up closer and more personal

Steve Jobs once famously stated that your TV and PC would never merge. He felt you leant back and switched your brain off when watching TV, whereas you leant forward and switched your brain on with a PC. But he kept dabbling in this inevitable coming together as a ‘hobby’, and Apple TV became one of the ways that you could access the web via your TV.

And now, very quietly but very quickly, over 50 per cent of Australian homes have filled up with TVs that can be connected to the internet. This isn’t just good news for technology companies, but those of us in the advertising industry can see big things coming too. We’re all looking forward to the day when we can catch you at home watching television shows peppered by very specific commercials that have been chosen because they are relevant to your lifestyle.

How soon that day may come has a lot to do with how quickly Australians adapt to this new television order. While half our homes may have internet-enabled TVs, only half of those have them hooked up.

There are many reasons why we’re yet to take to this new lounge room technology with more zest. First and foremost, it’s because there is no simple and common platform to bring together all of the TV and video content that’s out there. This is despite the fact that hotels rooms have had this technology for a few years, allowing you to see your bill, and more importantly movies, on demand.

The fact is that TV manufacturers, TV stations, telcos, broadband suppliers, Apple, Google, Microsoft, Yahoo and Intel are all trying to crack the internet-connected TV experience, but each is doing it on their own as they try to replicate Apple’s success with music via iTunes.

Rest assured, someone, or maybe a consortium of the above, will win this battle soon enough. In the not-too-distant future, I see a world where there is a common and simple platform to bring together all of your favourite TV, movies and video content on your TV screen, at speed and in HD, and that you can navigate around easily via your iPad or smartphone rather than a multitude of remotes or keypads.

The business implications of more widespread uptake of internet  TV are enormous. Content will still be king, and consumers will still gravitate to what they consider are the best shows, movies, sporting events, news reports and information. And whilst it will still cost the same to produce that content, the delivery of that content to your TV via the internet is significantly cheaper than traditional infrastructure such as satellites and towers. Plus the content provider can still charge accordingly, via subscription, or make money by allowing advertisers to access that audience.

What’s more, the opportunities for brands and advertisers are potentially endless. You’ll remember back in the hotel room when you first turn the TV screen on there are normally some ads about the hotel? An advertorial here and there on what you should do as a tourist while you’re there? That’s advertising specifically targeted just to those hotel customers. And that’s the big opportunity for brands in this new world where TVs are connected to the web. They will be able to pinpoint the most valuable group of consumers and send truly relevant and personalised communication to them, in real time.

This is already happening on websites. Cookies record your every movement on the web, and this data provides brands an ability to serve up ads based on your previous online behaviour. Much of this is now conducted through automated digital ad exchange technology.

Apply this to smart TVs, and you will have real time serving of relevant and personalised 30-second TV commercials. And if we know that person flicks channels before the end of the ads, we can serve them a 15-second ad instead. Or a 5-second banner ad, a familiar format on the web, but a new format on TV.

So the world of one simple TV remote control on your mobile or tablet, one easy-to-use platform to watch any show you want, and one big TV screen in your lounge room where you only get to see ads that are relevant to you, is not that far away.

Yes it will be great for viewers. But even better for brands and advertisers. Once it takes off, it will alter the way advertising is delivered and viewed on television forever. For those brands who embrace this new technology early, it will be a game-changer.