Big Data is one of 2013's most popular buzzterms. It's also transforming the cable television business, which is in ongoing disarray as cord-cutters and competition from phone companies change the rules of the game. Aggregate data analysis and predictive analytics are helping cable firms redistribute bandwidth, retain Netflix-centric customers, and rebuild in the wake of superstorm Sandy.
For Time Warner Cable, one of America's largest cable and broadband firms, Big Data helps determine the course of both their marketing efforts and their network infrastructure. In terms of Time Warner and rivals like Comcast and Cablevision, one of their biggest headaches right now is over-the-top content (OTT): services like Hulu and Netflix that deliver their programs to viewers over cable company infrastructure. Every time a home viewer uses their Xbox 360 to watch Netflix or streams Hulu's latest Bob Burger's episode on their laptop, this presents a technical challenge for cable firms. Data, including television shows, reaches homes over a physical infrastructure of cables and routers. OTT data needs differ than those of conventional cable television, which is one cause of the ever-hated buffering of streaming content.
While cable companies generally aren't keeping track of what their viewers watch, aggregate data of customer data is extremely important to them. Time Warner and its rivals keep track of customer engagement, and how often customers use which services. The question of how bandwidth impacts customers, what nodes networks connect to, and which times of day see peak usage is highly important to them.
"The challenge for us is generating an ocean of telemetry. Millions of users download our (iPad) app and get experiences from around our network. On our end, the challenge is taking the scale and size of data and making achievable results," senior director of online video Ranga Muvavarirwa told Fast Company when discussing an app which allows viewers to watch cable on their tablet. In an example of the changing fortunes of the cable industry and how service providers are adjusting to new realities, Time Warner just announced a multi-year deal with Roku.
Big Data is also a part of everyday life in the advertising department. According to Time Warner Cable Media president Joan Gillman, the company uses sophisticated correlation solutions that meld publicly available data such as voter registration records and real estate records with local viewing habits. This helps Time Warner's clients launch custom campaigns tailored to geographic or demographic microsegments of users. Time Warner Cable Media is the cable giant's advertising arm.
One project fully encapsulates cable's use of aggregate big data for marketing. Time Warner Cable Media DMS is a pilot project in Texas that allows clients to target customers with the same advertising campaign simultaneously in cable television, mobile devices, the web, social media advertising, and other platforms. The sophisticated platform keeps track of users' individual engagement with the ad campaign on each platform and can tweak special offers to be more appealing to the end customer. For the user, the end result is the same ad campaign seamlessly migrating from television to their web browser to their inbox; as maddening as it is for customers, Time Warner Cable Media claims their metrics have been extremely positive.
Similar technologies are also being used to keep cord-cutters subscribing to cable television services. The Big Data analytics and crunching platforms used by cable companies come from a variety of third-party vendors. One of them, DNS analytics firm Nominum, works with cable companies such as Cablevision Argentina to analyze aggregate customer activity in order to provide custom packages.
Time Warner, Comcast, and other large cable providers all make huge profits, but all face rising infrastructure costs and declining service. While their options might be limited in terms of retaining customers hard-hit by the economy, they can still appeal to cord-cutters and, as in the case of DMS, build new revenue streams.
[Image: Flickr user Matthias Weinberger]