Vizio Alters Inscape Data Licensing Deals as CTV Land Grab Heats Up

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Major players in connected TV, including Amazon and Vizio, are solidifying their positions as go-to ad platforms as the streaming grab ramps up.

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Vizio is altering licensing agreements with ad-tech companies using Inscape Data Services, its TV data company. According to multiple sources, Vizio is restructuring contracts with Inscape customers to limit retargeting and other use cases of Inscape data that would cannibalize or otherwise compete with Vizio’s emerging ad business.

Vizio struck many of these data licensing deals before it launched its ad business at the end of 2019 and after a reorganization in October saw Inscape folded into Vizio’s platform business.

As Vizio brings Inscape in-house to bolster its ad offerings and smart TV user experience, the company’s data relationship with third parties is also changing. This change will impact ad-tech companies that have relied on Inscape to bolster their media arbitrage businesses.

Vizio has more than 30 million smart TVs in the U.S. Inscape currently offers automatic content recognition data, which tracks what viewers watch, gathered from more than 16 million opted-in Vizio smart TVs in America.

Vizio declined to comment.

Amazon’s walls rise higher

Similarly, Amazon’s relationship with ad-tech companies in CTV has also been changing.

In the middle of 2019, Amazon struck deals with software companies Dataxu and The Trade Desk to allow both demand-side platforms (DSP) to resell some Amazon Fire TV streaming inventory. The deal with Dataxu ended after competitor Roku bought the DSP in October 2019.

As of September 2020, The Trade Desk is also no longer partnering with Amazon. Instead of having a direct line to Amazon Publisher Services, the company’s header bidding tool, The Trade Desk is now favoring closer relationships with app and content owners. This is primarily through other supply-side platforms (SSP) that “offer transparent access to a wide range of broadcaster inventory,” the company said in a blog post.

During the company’s most recent earnings call, The Trade Desk CEO Jeff Green said he initially thought the relationship with Amazon would last longer. He added that Amazon Publisher Services represented less than 1.5% of CTV ad impressions through its platform. “Getting that [inventory] more directly, it’s actually better for us, better for our advertisers,” he said.

Amazon, which has more than 40 million monthly Fire TV users in America, also didn’t give the DSPs access to its owned-and-operated IMDb TV streaming service, according to multiple sources.

Building up walls as the space matures

CTV platforms are building out their advertising businesses as more people flee their cable providers in favor of streaming, a trend that has been accelerated by the pandemic.

As a result, CTV ad spend is expected to reach $8.1 billion by the end of the year and grow by $6 billion over the next two years, according to eMarketer.

Given the changing consumer behavior and growth in spend, streaming platforms are building technologies and fine-tuning business models to attract those viewers and dollars. For example, smart TV maker Samsung, which has a U.S. footprint of more than 50 million smart TVs, recently launched a DSP. Meanwhile, Roku, with 46 million monthly U.S. accounts, introduced a revamped ad-tech offering.

But walled gardens in CTV are different than the rest of the digital environment, which is dominated by Google and Facebook. Similar to the digital duopoly, platforms such as Roku, Amazon and Samsung don’t let their first-party data travel outside their walls. Although Vizio is still selling Inscape data, it now has limitations on how it can be used.

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