Blockchain is more than just Bitcoin: it’s got significant potential for industries outside of finance.
In a whitepaper released today, the Interactive Advertising Bureau uncovers strong use cases for blockchain technology for higher-value, lower-volume media placement, like digital video and over-the-top (OTT) advertising.
Current blockchain networks can cut down on the rampant fraud in the digital advertising space, allowing advertisers and publishers to deal directly with one another transparently, eliminating untrustworthy middlemen and increasing accountability for all parties. Additionally, the decentralized structure of blockchain networks reduces the chance of hackers stealing information or rerouting any transactions.
“Blockchain seems to be the new ‘siren’s call’ in the business world—but there is no doubt that this technology holds tremendous promise for digital video advertising,” said Anna Bager, executive vice president of industry initiatives for the IAB.
The current stumbling block for blockchain in its current state is its speed, or, more aptly, its lack thereof. Though engineers for networks like Etherium are working to speed up the process, blockchain networks are still several hundred thousand times too slow to handle programmatic advertising’s millions of tiny purchases per second.
While this more or less eliminates blockchain networks from contention for high-volume, cheap digital formats such as banners or pop-ups, the more exclusive media of video and OTT align well with blockchain’s strengths. According to the IAB’s report, the relatively tiny amount of transactions per second, young market and limited amount of well-known publishers all point toward a successful implementation of blockchain technology.
Despite these advantages, the IAB doubts that many OTT players will jump on board with the technology, however. Ad fraud isn’t as much of a problem for companies like Hulu, and they may not see much need in rocking the boat.
“My hunch is that you are going to see blockchain flow out from PC and mobile first before you will see it kick off in OTT,” said Adam Moser, head of ad operations for Hulu.
Additionally, success for the platform would require broad adoption among OTT companies, but the ad buying process differs for every publisher.
“We’ve always found the way you do things for Roku is very different from how you do it for the Samsung TVs or Xbox or PlayStation,” Moser added. “Seemingly, there is no one device on which it is the easiest to integrate and no devices we cannot integrate with. It’s a bit of a chicken or the egg dilemma.”
The IAB considers these obstacles surmountable, writing: “On balance, the advantages of focusing on the digital video/OTT asset class outweigh the disadvantages.”
This whitepaper is only the first of what the IAB expects to be a long discussion about the potential of such a technology over the coming years.
“Tapping into our members’ pioneering work and insights from across the ecosystem, we plan to offer thought leadership, guidance, and inspiration that will steer the new course for digital video, OTT, and blockchain,” concludes Bager.