Cox Widens FreeZone to Serve 9 Markets

Jan 17, 2005  •  Post A Comment

In an effort to create a quasi-national platform for long-form advertising in video-on-de-mand, Cox Communications has expanded the FreeZone category in its on-demand service from one market, San Diego, to eight more of its 26 markets. Together, the nine markets reach about 1 million digital cable customers.

As part of the expansion, Cox will deliver VOD usage data to the advertisers on a daily or weekly basis. The availability of such information-essentially the ratings for the on-demand platform-is considered critical to further rollout of ad-supported VOD. Cox is talking to national advertisers about placing buys and developing content for the platform and expects to have several on board later this quarter.

General Motors has worked with FreeZone in the past to market its Pontiac and Cadillac brands and is considering FreeZone again, though no deal has been done, said Ryndee Carney, manager of marketing communications for General Motors. “You know you are reaching people who have an interest in your product because they are raising their hand and choosing to view your content,” she said. “It’s more targeted.”

VOD Can’t Be Ignored

The FreeZone expansion illustrates that VOD can’t be ignored by advertisers much longer, said Tim Hanlon, senior VP and director of emerging contacts at Starcom. “It’s a shot in the arm for the platform. It’s getting more and more difficult for marketers to avoid these platforms,” he said. “We have plenty of advertisers who have been interested in doing FreeZone with Cox, but for whatever reason San Diego wasn’t a market that fit into their plans.”

Cox was the first cable operator to earmark space in its VOD service for such advertiser-centric content when FreeZone launched in San Diego in 2002 with heavyweights including Coca-Cola, Kraft, Volvo, Best Buy and BMW Films. That first round of content, for example, included a Diet Coke short film with several episodes.

The eight additional Cox markets to get FreeZone are: Orange County, Calif.; Las Vegas; New Orleans; Oklahoma City; Omaha, Neb.; Hampton Roads, Va.; and the states of Connecticut and Rhode Island.

Cox also plans to expand its VOD programming slate, which consists largely of movies and premium content from HBO and Cinemax, with on-demand content from Starz! in Las Vegas and Showtime in Oklahoma City. The operator expects to introduce additional content across its markets shortly.

By the end of January, all nine markets will be ready to go with FreeZone. Cox plans to offer FreeZone to additional markets as it rolls out VOD further, said David Porter, director of new media for Cox Media, the ad sales arm of Cox. Support for the platform comes from VOD services firm N2 Broadband, which is handling the production and distribution of the content, and measurement firm Everstream, which delivers usage data.

Everstream will initially provide four data points: total number of views per video; average time spent viewing the video; number of unique households watching the video; and the percentage of eligible homes viewing the content. Over time, additional data will be provided, Mr. Porter said.

‘Trick Mode’ Down the Road

Such data is a first step in the right direction, said Raj Amin, VP of content and advertising markets at N2. Since the long-form ads are both the ad and the content, Cox doesn’t have to worry about providing the more complicated “trick mode” data yet. That’s the information about whether a user fast-forwarded or rewound an ad that’s been baked into existing content from a network. “The statistics mean a lot more for a long-form ad because the whole thing is an ad,” Mr. Amin said.

Cox has pitched the platform to automotive, entertainment, retail and packaged-goods advertisers. “The fact that Cox is rolling out the same product in nine markets is very appealing,” said David Cohen, senior VP and interactive media director at Universal McCann. Long-form VOD ads make sense for entertainment and information, such as movie trailers, music, behind-the-scenes and red carpet content as well as how-to material, he said.

But the challenge with any VOD product is securing on-air promotion on linear channels to drive viewers to the VOD platform, he said. Ideally, a cable operator will offer 50 to 100 spots per week tagged for a particular advertiser, Mr. Cohen said. Cox said it will provide promotional spots for FreeZone and for its on-demand service in general.

The drawback of a platform like Cox FreeZone or Comcast’s counterpart, Comcast Spotlight, is it can never be truly national in scope the way that a programmer’s brand, like Discovery or HGTV, is, Mr. Hanlon said. “[Programmers] are universal and play across multiple VOD systems and not just one operator,” he said.

Mr. Hanlon expects national advertisers will want to place ads in on-demand content from national networks as well as the long-form platforms operators offer. But simply porting over a 30-second spot won’t work in either venue. The ads need to be better integrated and less disruptive to the viewing experience, he said.