A few weeks back, Cognitive Networks claimed it was about to cut deals with companies that shipped what amounted to 45 per cent of the smart TVs in the US.
We have since been trying to work out market share combinations to identify those it had signed with. It made the task slightly easier this week by finally unveiling the first as LG Electronics.
The trick up the sleeve of Cognitive Networks is to move content recognition to the cloud, and place a thin client on a device, which makes porting far easier, in this case it believes that one day the smart TV will be the best device to have such a client on, and that in this way it can offer a number of advanced services across the board – mostly advertising-related.
CEO Michael Collette walked us through a very simple idea indeed – instead of a second screen application trying to identify what’s on TV, an application in a smart TV can do the job, with a little bit of help from its Engage platform in the cloud.
This in turn tells everyone what is actually playing on TV right now, which allows the owners of that content to serve advertising and other services against it.
He told us, “We can tell anyone who needs to know, just what’s being viewed on the TV, right now,” while Nielsen People Meters can only tell you what people watched after the fact. The trick is being able to respond in real time and drop either adverts or other content in an HTML 5.0 overlay into the precise moment in a TV programme, where it is required.
The system grabs tiny fragments of content from small regions on the screen and throws them to the cloud for recognition, picking them from 10 different frames in each second. Collette told us that the ser-vice would be on 10 million TVs by mid-2014 and now it is headed for LG smart TVs being sold in the 2013 range as well as being downloadable to those in the 2012 range.
Collette talks about identifying events, little desirable points in a TV programme where the owner, or some partner, can insert an HTML link which will show as an overlay on the TV screen. It can either tell him that there is an HD version on another channel, or it can advertise similar programming, or offer to give the entire series to the viewer OTT or simply place an ad. And that advertising can be enhanced by knowing where you are, for instance by the addition of local stores on a map, with push to call options to contact them.
Cognitive Networks has been sending customer notifications for the past two quarters, but it is only now that those customers are ready to react automatically to them by sending overlays to the screens.The Cognitive Network runs as a system as a service platform (SaaS) and can run most business models from a CPM basis to a subscription.
Right now the deliverable to the TV screen is only the insertion of an overlay, in mid-2014 this should move to trigger the installation of an app on the TV, and then release extra OTT content, and finally move to dynamic advertising insertion by 2015. The system can also be used to measure viewership in real time and throughout the time that a show is aired.
According to NPD DisplaySearch, market share in smart TVs ship-ments in the US breaks roughly Samsung 34 per cent, Vizio 26 per cent, Sharp 15 per cent and Panasonic 10 per cent with LG on 9 per cent. So a combination of LG, Panasonic and Vizio might get Cognitive Networks to its magic number of 45 per cent, but just adding Samsung might do the same.
We’re not sure where Sony is right now, but globally it’s on about 11 per cent but if those other figures are right it can’t have more than 6 per cent in the US.
So expect at least one, probably two and maybe three more such deals this year from Cognitive Networks, all of which would really make it an advertising force.
Meanwhile in a completely unrelated announcement LG Electronics said that it is making available its Curved OLED TV in Germany, which it says makes it the first TV maker to bring an advanced OLED TV to Europe. It is going to Germany this week and will roll out in other European markets in the fourth quarter, priced at around €9,000.
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