@ pcE11: Dawn Ostroff: Streaming Is Better Than DVRs For Advertising

Veteran TV exec Dawn Ostroff has only been in her job as the head of Condé Nast’s new entertainment unit for three weeks, so it made sense that she didn’t have much to say about that work when she sat down with our Staci D. Kramer at paidContent Entertainment 2011 conference in LA. Instead she offered insights about the recent spate of streaming deals that her former employer, The CW network, has recently struck.
Ostroff left The CW network after five years. That network recently made a series of major streaming deals with Netflix (NSDQ: NFLX) and Hulu. As Kramer noted, the Netflix deal could be worth $1 billion to The CW and its shows producers. “It’s really a new business model in the making and those deals were going on before I left,” Ostroff said. “We were criticized for not jumping on Hulu when it started. Our target audience is 18-24 years old and we kept our streaming content exclusive on our site. We came up with a concept to put full commercial loads in our streams. Instead of just having two little spots at the beginning and end of stream. That gave us the same CPM online as on air. By doing that, we were paid a substantial amount of money and it made a lot of sense.”
Satisfied with having established the TV-like model for The CW site in the minds of viewers and marketers, the broadcaster decided it was ready to explore outside streaming deals. The appeal of the Netflix placement, is that the network can try to attract new and irregular viewers who would like to catch up on an entire season in weekend. And with Hulu’s paid subscription format, The CW felt it was still able to protect its own site’s model, which is solely ad-supported.
As viewers get more used to time-shifting both online and through DVRs, is there a difference between the value of viewers on one platform versus the other, when it comes to advertising? “The CW felt it was better off if viewers stream rather than DVR-ing,” she said. “You’re getting the same CPM as you get on air. Because we didn’t allow our content anywhere else, we were in a unique position. For advertisers, the goal is still the same: it’s all about where your content is, who your viewer is.”