Nielsen Sells Its Video Ad-Tech to Roku, Part of Multiyear Deal

Roku has inked a multi-year deal whereby data from Roku’s platform will be incorporated in the upcoming Nielsen ONE cross-media measurement product and Roku will acquire Nielsen’s Advanced Video Advertising (NAV) business, which will enable it to offer a fully addressable advertising solution for TV programmers. Under the terms of the deal, Roku will have Nielsen’s video automatic content recognition (ACR) technology and its dynamic ad insertion (DAI) system, allowing it to offer targeted, household-level advertisements.

Variety reports that, “for Nielsen, the deal marks its exit from the video ad-tech business,” and, said Nielsen general manager of audience measurement Scott Brown, “Nielsen’s laser focus on measurement.”

Roku vice president of product management for advertising Louqman Parampath noted that his company, which had 51.2 million active accounts at the end of 2020, combined with Nielsen’s video ad technology “will let Roku deliver the benefits of streaming advertising to traditional TV networks.” “Roku will bring the promise of DAI to the market for the first time ever at scale,” he added.

Roku’s first addressable ad tests will run with Disney, CBS, Discovery, Fox, NBCUniversal, WarnerMedia, A+E Networks and AMC Networks.

When the deal closes, Roku will have “renewed conversations” with those partners and “other smart TV makers” regarding its ability to enable addressable ads. Nielsen, which has existing deals for data from DirecTV, Dish and Vizio smart TVs, will be able to add data from “Roku’s base of smart TVs and other devices” for its Nielsen ONE product, which “will draw on nearly 100 million devices with the addition of Roku.”

Under terms of the deal, Roku will also support Nielsen Total Ad Ratings (TAR) measurement by natively integrating Nielsen Digital Ad Ratings into its OneView media sales and ad-buying platform. Roku unveiled OneView after its acquisition of “demand-side platform provider Dataxu in October 2019.” Roku will also incorporate Nielsen AVA’s approximately 100 employees including general manager Kelly Abcarian and “assume ownership of Nielsen’s portfolio of ACR and DAI patents.”

The Verge reports that, according to Q4 earnings, Roku “grew its user base by roughly 40 percent between 2019 and 2020,” and its ad-supported Roku Channel doubled its audience, reaching “approximately 61.8 million people in the U.S.” in Q4. It opines that, “Roku’s tech platform and scale is exactly what Nielsen’s Advanced Video Advertising unit needed.”

According to Axios, addressable TV advertising only makes up 10 percent of the overall U.S. linear ad business, but “executives feel strongly that [it] is the future.”