Google Buys into Adressable Ads; Takes on Canoe

Google is moving more aggressively into the addressable advertising market, leading a $23+ million financing round in INVIDI, a technology company aligned with agency GroupM to begin serving ads to DISH Network and DirecTV subscribers in the coming months. More interesting, in a deal announced last month, bitter rivals DirecTV and DISH are working together on a new interactive advertising platform, which could go toe-to-toe with MSO champion Canoe Ventures.

What INVIDI offers is a no-brainer for the Satellite operators, it allows them to target their subscribers geographically which had never been possible before, and by combining forces DISH and DirecTV can provide a more efficient local advertising platform to reach 30 million plus households.

As described in the announcement of the DirecTV deal in June 2009:

Prior to this agreement, DIRECTV could only sell advertising across its national footprint. Now with INVIDI’s technology, each individual television commercial will have its own unique criteria and will be dynamically served up by household, street, subdivision, neighborhood, political district, retail trading zone, DMA or region.

INVIDI seems to have a solution that works. In a trial of addressable advertising effectiveness done by Starcom MediaVest Group (SMG) and Comcast Spotlight, homes in the Baltimore area “receiving addressable advertising tuned away 32% less of the time than homes that received non-addressed advertising. The trial also demonstrated a 65% greater efficiency from sending ads only to relevant groupings that the advertiser wanted to reach, based on the per-spot costs of addressable and non-addressable ads.”.

Meanwhile MSO-backed Project Canoe has floundered in attempts to bring better targeting to Cable subscribers. Around the same time as INVIDI announced their deal with DirecTV last year, Canoe announced that they were shifting gears from addressable advertising to interactive advertising due, MediaBuyerPlanner reported to “operational flaws that made the platform impractical to use.”

While Canoe has the support of the six largest Cable operators in the country, news about their progress has come at a glacial place. A glance at their newsroom shows that they’ve hired a bunch of people, and they have a recently formed advisory board, but that’s about it. Canoe has publicly said they’re focused on rolling out interactive advertising solutions but launch plans have been continually pushed back.

It will be a big challenge for Canoe partners to quickly get interactive enabled set-top boxes into subscriber households, the cable industry has not been traditionally very quick to adopt new technology. Though Comcast CEO Brian Roberts has said he expects to see revenue from Canoe in 2010 the venture is already miles behind DirecTV and DISH both in rollout and technology.

Google’s entrance via their investment in INVIDI is a far bigger deal than a simple strategic investment, it puts them into an alliance which will have wider implications for the future of media.