Yahoo ties up With CBS, HSN to make live TV more interactive

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By Douglas MacMillan and Cliff Edwards
(c) 2011 Bloomberg News
Thursday, January 6, 2011; 12:08 AM

Jan. 6 (Bloomberg) -- Yahoo! Inc. is staking a claim in interactive advertising, a market projected to boom as televisions and set-top boxes offer Web connections.

Yahoo is working with CBS Corp., owner of the most-watched U.S. broadcast network, and home-shopping retailer HSN Inc. to add interactive features to live broadcasts aired on sets with Yahoo's Connected TV software, said Russ Schafer, director of product marketing for the Connected TV group.

The company, which began promoting TVs with its Web software in 2009, is vying with an increasing number of rivals, including Google Inc. and Apple Inc., for customers in their living rooms. The new features, called Broadcast Interactivity, let viewers click buttons to learn more about an actor or a program, or buy items they see while watching live shows, Yahoo said yesterday at the Consumer Electronics Show in Las Vegas.

"The key feature is to sense what you're watching and provide interactive content through a very subtle prompt," Schafer said. "It's the truly interactive TV we've been talking about for years."

Sales of targeted display advertising -- ads delivered through the Web -- will grow almost 60 percent this year to $10.9 billion, according to research firm Borrell Associates.

Targeted advertising sales for broadcast, cable and satellite TV reached about $750 million in 2010, the first year it was tracked, said Larry Shaw, vice president of research at Williamsburg, Virginia-based Borrell.

"We expect it to grow significantly," Shaw said. "By 2015, we're predicting that targeted advertising is going to dwarf standard display advertising."

Viewers of CBS's Showtime Boxing will be able to retrieve information about athletes during live matches and participate in surveys about which fighter they think will win. People watching HSN can purchase discounted items featured on the channel by clicking their remotes.

TiVo Inc. and other makers of digital-video recorders, which can fast-forward through commercials, have forced advertisers to explore new ways to reach their target audience.

By tying advertising more closely to what a user is watching, personalized recommendations and ads become more relevant, Yahoo's Schafer said. That makes consumers more likely to opt in for more information and provide marketers with their personal information, or to watch longer-form video spots, he said.

Along with Sunnyvale, California-based Yahoo, Rovi Corp., which makes interactive-programming guides for cable and satellite providers, stands to benefit as a middleman offering software for millions of Web-connected TVs and set-top boxes.

Rovi, in nearby Santa Clara, plans to use its library of more than 6 million catalogued pieces of music, movies and other media to let advertisers recommend products based on what a consumer is watching, the company said today at CES.

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