Like most MVPD providers, DirecTV is making investments in their TV Everywhere services so subscribers can view the same content on tablets, smartphones and other connected TV devices. But how to monetize it? DirecTV has decided to take an equity stake in Video ad company FreeWheel to help make that happen.
FreeWheel provides a platform for dynamic ad insertion in on-demand and live video feeds online. Over the years, the startup has been tapped by a number of large partners to handle in-stream monetization, including AOL, ESPN, FOX, NBC Universal, Sky, Turner, and VEVO, reports TechCrunch.
DirecTV will also be using FreeWheel’s monetization rights management technology, FreeWheel co-founder Doug Knopper told TechCrunch. That will allow DirecTV to manage ad sales and delivery with its content partners, to ensure that the right ads are delivered and the right content providers are compensated for monetization that happens against their streamed shows.
FreeWheel is no stranger to taking strategic money from media companies. Previous investors include Turner Broadcasting and Disney investment arm Steamboat Ventures. The company has announced two prior rounds of funding, adding up to about $30 million, with other investors including Battery Ventures and Foundation Capital.
RBR-TVBR observation: While a recent GfK Media study says only 17% of cable or satellite subscribers have watched programming from their MVPDs online using TV Everywhere (and the effort is plagued with difficult rights negotiations between entertainment companies and pay TV operators), this sort of infrastructure must be in place. That’s because the more appealing the negotiations are for content providers (read: ad revenue split), the more likely deals will be struck. When more content is available to viewers, the TV Everywhere numbers will go up.