jeebusWhen you watch your favourite program in the not-too-distant future, your TV could be watching back.
Cable companies are preparing to install software on digital set-top boxes that will keep track of everything you watch. Coupling that information with your address, the software would estimate your age, gender, interests and income.
The result? Advertisers could send different commercials to different viewers.
A father and daughter watching the same hockey game on different television sets would each see different ads. Perhaps there would be Molson Canadian, Tim Hortons and Canadian Tire for dad; Virgin Mobile, Harvey's and Coke for his teenage daughter.
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"It turns Desperate Housewives into Disparate Housewives," said Bob Reaume, vice-president of policy and research for the Association of Canadian Advertisers.
It could be years before the technology comes to Canada, but two U.S. cable companies are planning to roll it out early next year.
The concept will likely raise red flags from privacy advocates, and its implications are enormous.
Advertisers would be able to make sure the right ads are seen by the right people, challenging the old industry saying: "I know half my advertising dollars are wasted. I just don't know which half."
Leading the charge is Invidi Technologies Corp., which is finalizing deals with two U.S. cable companies to install its software and begin "hypertargeting" ads early next year.
The company, now based in Princeton, N.J., was founded in Edmonton, where half of its engineers are still headquartered.
Invidi president David Downey was in Toronto this week to promote the software at a meeting of the Cable and Telecommunications Association for Marketing.
It's astounding how quickly and accurately the Invidi software can come up with a demographic profile of a household and its members, Mr. Downey said during a panel discussion on the topic.
"Our goal is to have this software in every set-top box in the world . . ." Mr. Downey said. "There's no one else that's doing what we're doing."
Another technology from New York-based Visible World Inc. is already being used by U.S. cable companies to tailor advertisements by geography.
It could be years before such technologies arrive in Canada, though many advertisers, broadcasters and media buyers are quite enthusiastic about it.
"This sounds like a really good idea and we should take extraordinary steps to see if this can work," said Mr. Reaume, who sat on a panel to discuss the idea.
Mike Lee, chief strategic officer for Rogers Communications Inc., had more reservations.
He said the ability to customize ads for different viewers is a natural evolution for the television industry, one that parallels what's going on in the Internet. "Media is going to be more accountable, more targetable and more relevant to the customer," Mr. Lee said.
But he said he had concerns about privacy. And he said the economic model underpinning cable television in Canada might make adoption of the technologies more difficult than in the United States.
In Canada, all advertising is sold by broadcasters, while cable companies in the United States sell some of their own ads.
So while U.S. cable companies have a vested interest in maximizing ad revenue through hypertargeting ads, Canadian cable companies would have to be compensated for the move.
"There are definitely some significant costs and some business risks associated with deploying these kinds of services," Mr. Lee said.
"There's going to have to be some compensation for that business risk and those costs."
Invidi says it will make its software available for free, but it will take a cut of any additional revenue that broadcasters and cable companies generate through the technology.
The biggest risk, Mr. Lee said, is that consumers could get upset about software that watches what they watch, and lash out against cable companies.
Darrell Evans, executive-director of the B.C. Freedom of Information and Privacy Association, said cable companies should not gather information on what viewers watch without their consent.
Mr. Downey said Invidi built its technology around privacy concerns.
He said any information collected about the viewer resides in the set-top box, and the matching of viewers and ads is all done electronically.
"We've gone to great pains to stay on the right side of that issue. . . ," Mr. Downey said.
"No personally identifiable information ever leaves the box. We don't need it."
TV that watches you
Invidi Technologies Corp. wants cable companies to load its software onto digital set-top boxes. By monitoring viewing patterns, the software assembles profiles of each household's viewers, then sends them ads that match their profiles.
GEOGRAPHY
Each set-top box contains the viewers' address. This information could be used, for example, to customize ads for local retailers or service providers.
GENDER
The software watches viewership patterns to determine the likely genders of household members. For example, men watch more sports and change the channel more frequently.
AGE
Invidi monitors viewership patterns and cross-references these against demographic data from television ratings providers to come up with estimated age profiles.
INCOME
Estimated household income is calculated through a combination of the types of shows you watch and the neighbourhood you live in.
INTERESTS
Consumers could chose to volunteer additional information. Someone in the market for a new car might actually prefer to see more car ads during Survivor.
PRIVACY
Invidi says viewers don't need to be concerned about privacy issues because viewership data resides in the set-top box and never gets passed back to Invidi or anyone else.
I knew this was coming. What I don't know is how far or how creepy it's gonna get. It's WAY double ungood.
