Video Ads Are Coming to LG Smart TVs

8Nov/110

Video Ads Are Coming to LG Smart TVs

The TV networks and pay TV services are not the only ones that can make billions selling ads.

LG is using YuMe’s video advertising platform and network to add an advertising capability to its smart TVs, and Toyota has already signed up to advertise its 2012 Toyota Camry. Toyota says it’s part of what will be its largest marketing campaign.

Viewers will see the Camry ads when they look at the apps or do a search on LG smart TVs, Blu-ray players and dumb TVs that are connected to the LG Upgrader smart TV adapter.

The TV networks and pay TV companies are not involved and get none of the ad revenue. LG is thought to be third to Samsung and Vizio in smart TV sets in the States. It is on a campaign to be a sales leader in 3D sets, which are always smart TVs.

We estimate that over half of American homes have a smart TV or a dumb TV with a smart TV adapter like a Blu-ray player, game console or STB like Apple TV. We expect Europe to follow as more OTT content becomes available. And ads follow eyeballs as sure as night follows day.

Smart TVs are now ubiquitous. By this time in 2012 almost all the TVs in stores that are 40-inches or larger will be smart TVs. Based on what LG is doing, they’ll all be showing their own ads.

Last week Amazon was selling an LG 42-inch LED smart TV for $645 — including delivery to the home. Why not get a smart TV at that price because the price differential between smart TVs and dumb TVs is now less than $100.

YuMe SVP for emerging platforms Frank Barbieri told the New York Times that his company and LG intend “to target ads so they’re more relevant” to viewers, using the experience YuMe has accumulated in operating “an ad platform that serves 1.5 billion video ads a month for online and mobile.”

Barbieri called it “the power of Internet advertising with the impact of television advertising” and said it was “one of the biggest technological evolutions for television advertising since there was television advertising.”

YuMe will sell the ads and the revenue will be split three ways: LG, YuMe and the app developers.

Samsung Venture Investment is about to invest in YuMe. Samsung is the global leader in sales of TV sets and LG is second. Intel Capital is also an investor.

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