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January 15, 2013

Can Big Data Throw Cable a Life Raft?

Datanami Staff

With the advent of on-demand streaming, the value of must-see television is diminishing. As streaming services like Netflix and Hulu cut into network shares, the broadcast industry has been forced to adjust to the evolving interests of its customers.

To deal with this paradigm shift, service providers like Time Warner Cable and Comcast are processing and analyzing big data to help them navigate media’s changing landscape.

Many consumers over the last couple of years have chosen to eschew cable for the internet simply because it can single-handedly deliver all of the content they would want, with live sports and heavily-hyped shows like “Breaking Bad” and “Game of Thrones” being possible exceptions.

For the most part, service providers route cable and internet through the same infrastructure. Content from the streaming services like Netflix, otherwise known as Over-The-Top content (OTT), switches users from cable to broadband. TWC is thus interested in collecting data on the extent to which customers are using that broadband and adjusting their infrastructure to better meet that demand.

“The challenge for us is generating an ocean of telemetry. Millions of users download our (iPad) app and get experiences from around our network. On our end, the challenge is taking the scale and size of data and making achievable results,” said senior director of online video Ranga Muvavarirwa. Modeling customer behavior and fitting packages to meet that behavior is a big data exercise that financial services and retailers have been facing.

To an extent, however, TWC’s situation is more comparable to that of a utility company. While running cable programming to televisions is a fairly straightforward process that has been improved upon over the last couple of decades, broadband internet is subject to outages and peak hours.

Another challenge is finding a way to fit in advertisements. When people watch shows on Netflix, there is a limited amount of space to fit ads as commercial breaks are fewer and farther between. As such, TWC is looking at transitioning TV ads to the internet.

Through their project Time Warner Cable DMS, they hope to offer ads streamlined to the individual much like how Facebook tailors their ad selection based on the data they collect from an individual’s profile.

To achieve that goal, TWC Media president Joan Gillman noted that the company combines viewer habit data with public real estate and voter registration records to generate custom ad content. In order to keep up with growing ISPs like Google Fiber, TWC will need to convince advertisers that their method of targeting is just as effective. Their video describes a direct marketing effort where an individual is bombarded with an offer several times so she can act upon it at her convenience, an effort reliant on persistence.

Another answer may lie in custom network packages. Instead of paying for a hundred channels, of which only about ten would be used with regularity, providers could offer discounted bundles of those ten main networks based on the individual’s viewing habits. TWC is working with DNS Analytics firm Nominum, which is currently helping Cablevision Argentina do just that. Of course, providers may encounter resistance from the networks as they rely on per-subscriber rates along with advertising revenue to stay afloat.

However, there exists a significant amount of data through which providers must sift to garner these insights. The incentive to do so is great as they struggle to maintain relevancy in an increasingly internet-dependent market.

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