Yahoo Makes Ads on a Bit More Like TV

Startup Auditude Allows Live Insertion of Spots in Online Ad Pods

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NEW YORK ( -- Subscribers to Major League Baseball's online service are getting something different this season during games: as many as four times the ads.

Yahoo has a contract to sell ads on through the 2010 season; as of August, it started selling a lot more ads thanks to ad-serving technology from Auditude, which allows Yahoo to sell multiple ads within commercial breaks, just like TV.

That means a more-robust advertising revenue stream for the service, which costs $130 a year for all regular season games (plus an additional $9.99 for iPhone access), and is distributed through Yahoo,, web TV service Boxee and set-top maker Roku.

"You're watching a more TV-like experience," said Auditude CEO and former MTV exec Adam Cahan.

Clarion call
"More ads" has become a clarion call for online TV services from Hulu to to the CBS Audience Network as broadcasters attempt to boost revenue from online viewers. Ad rates for video tend to be higher online than on TV, but because there are far fewer ads, online revenue per viewer lags significantly online. That's why both CBS and ABC have tested viewer reaction to more ads online, and CBS recently started increasing them. And online users can't skip the ads, as they can if they use a digital video recorder on TV. One executive familiar with said the cost for an ad in a game streamed live online is typically about $20 to reach 1,000 viewers.

Live sports present an additional technical challenge: Because the live feed on is coming from the TV broadcast, it includes the broadcast's ad breaks of various lengths. Until the Auditude deal, Yahoo was showing viewers a pre-roll when they initially request a stream and then a single ad during longer breaks.

Ranging in length from 90 seconds to two minutes, most ad breaks end up as dead air. The switch is allowing Yahoo to sell and insert multiple 30- and 15-second spots depending on the length of the break and pull the ads from a pool of 30 to 40 advertisers, rather than just one or two.

Rebecca Paoletti, Yahoo senior director of video, said the company is planning to use the technology for other live events, such as concerts. "Normally, the technology would allow just one ad call," she said. "This allows us to figure out now long the ad break is going to be and insert the right number of ads."

Local ads
Yahoo isn't the first to deliver ads into live sports -- CBS's March Madness has multiple ad breaks within live basketball -- but the next step is to deliver the ads on the fly based on targeting and effectiveness. While geo-targeted local ads are possible, Yahoo is selling mostly to national advertisers, including Subway and Geico.

Auditude's Mr. Cahan said the company is serving 3 million ad impressions per day for on Yahoo and 90 million a month since starting at the end of July.

Are consumers tolerating more of Geico's gecko? A spokesman said Major League Baseball Advanced Media had not seen any consumer drop-off.

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