Time Warner Cable working on ad platform

By Yinka Adegoke

NEW YORK (Reuters) - Time Warner Cable Inc. (TWC.N: Quote, Profile, Research, Stock Buzz) is working with other U.S. cable operators, networks, advertisers and agencies on a common standard to better capitalize on interactive television advertising, its chief executive said on Wednesday.

Cable companies are working together to build a common system for advertisers who want to target more measurable ad campaigns at consumers through digital TV set-top boxes, Time Warner Cable CEO Glen Britt told the Reuters Global Technology, Media and Telecoms Summit in New York.

"We've figured out that we need to have some commonality across the cable industry because advertisers like to buy in big national footprints," said Britt, who runs the second-largest U.S. cable operator.

Traditional national advertising media such as network television and newspapers have been losing market share to the Web, which offers advertisers a better way of reaching specific consumers and tracking their response to the ads.

"We asked the question: Why are advertisers going to the Internet?" Britt said. "They like to be able to measure, they like to be able to know who's seen the ads, as opposed to a Nielsen sample."

He said cable operators now realize they can match many of the strengths of online advertising, which has grown as much as 30 percent annually in the past three years, by taking advantage of their modern cable systems with capabilities such as two-way communications and on-demand programs.

Online advertising, both with search engines such as Google Inc. (GOOG.O: Quote, Profile, Research, Stock Buzz) and graphic advertising such as banners, is driven by information provided by customers, such as their search terms or other personal information that is shared.

Cable operators have typically focused on local advertising in their respective regions. Time Warner Cable, for example, took in about $700 million annually in ad revenue.

The operators now believe working together on a national platform rather than individual trials could bring in a significant new revenue stream for them and their TV network partners.

"We're now engaged in trying to pull these disparate experiments together into a more unified situation with the advertising communities," Britt said.

At the Cable Show last week, Jeffery Bewkes, chief operating officer of Time Warner Cable's parent Time Warner Inc. (TWX.N: Quote, Profile, Research, Stock Buzz), laid out a vision of cable television as an on-demand interactive network that could compete with the Web for targeted advertising dollars.

The fourth-largest U.S. cable operator, Cox Communications Inc., announced a deal with Walt Disney Co. (DIS.N: Quote, Profile, Research, Stock Buzz) last month to prevent viewers of Disney's on-demand programming from fast-forwarding through advertisements.

Time Warner Cable also disables the fast-forward button on advertising with its Start Over service, which allows viewers who come in half way to 'start over' a show on-demand.

Time Warner spun off a 16 percent stake in TWC as part of a transaction to pay for some Adelphia cable assets last July.

(For summit blog: summitnotebook.reuters.com/)

(For more on the Reuters Global Technology, Media and Telecoms Summit, see ID:nSP21633