The number of American homes with the capability to receive interactive television (iTV) commercials will hit a critical point within the next eighteen months that will drive a ‘huge increase’ in the number of advertisers using interactivity in their campaigns. This is the key finding from a new study on iTV advertising by BrightLine Partners.
Interviews with key TV advertisers, along with market research, have shown that the 6.5 million households which receive interactive ads needs to grow to just 10 million before the audience is a sufficient size to spur the majority of TV advertisers to use iTV in their schedules.
BrightLine forecasts that this level will be reached by early 2004, citing a number of driving factors. These include intensified competition among cable and satellite operators, the ongoing quest for new sources of ad revenue, and the potentially catalytic effects of Rupert Murdoch’s acquisition of DirecTV (see Murdoch Seals Acquisition Of DirecTV).
The UK picture In the UK, over 40% of homes can already receive interactive TV and advertising. Despite this, the sector has failed to take off. A recent report from the Billetts consultancy claimed that interactive advertising is suffering from ‘a perceived lack of credibility’ (see Jury Still Out On Interactive Advertising).
Billetts found that many advertisers remain to be convinced that interactive advertising is profitable and it issued a challenge to the industry to find a way of accurately measuring its impact. “Advertisers will only really embrace the interactive opportunity when it is clear that it is a channel that provides cost-effective results,” it said.
It is thought that just 200 iAds had run on BSkyB’s platform by the end of last year. Forrester Research claims that iTV will generate no more than â‚Ź18 million across the whole of Europe by 2007, although the UK currently leads the way (see Limited Growth Forecast For iDTV).
