The State of Smart TV: Automatic Content Recognition (ACR)

ACR (Automatic Content Recognition) data from smart TVs may be one of the most revolutionary ways for networks and advertisers to measure viewing habits. It’s also one of the least understood pieces of technology in the TV ecosystem, so what follows is an attempt to shed a little light on the topic.

ACR is not only about helping television get more digital; it also allows digitally-delivered video to move beyond impressions and calculate reach and frequency, which has always been a necessity for television buyers.

The real-time nature of recording “glass-level” behavior moves T/V measurement into territory that television has not yet dared to visit. TV must be more measurable in order to compete with other digital delivery platforms.

Collecting Data

On a technological level, ACR data works because smart TVs (with permission) capture a few pixels from whatever the viewer is currently watching on the TV and share that data with the TV manufacturer’s ACR tracking software. The software takes those pixels and matches them to a database that keeps track of local broadcasts in whatever region the viewer is watching in.

By looking at the time, length of commercial breaks and which commercials are being seen, the ACR data provider is able to know several things: (a) is the viewer watching linear, OTT, DVR or VOD? (b) what shows and commercials they are watching on a second-by-second basis, and (c) what the viewers IP address is, which will then allow them to know their physical address and which websites and apps they visit. (This data is all anonymized, e.g., there are no actual names attached.)

Challenges Ahead

Data privacy issues and the consumer opt-in challenges will guide the level of success that ACR and its sibling addressability technology DAI will bring to the ad industry. As GDPR and the California Consumer Privacy Act bring legal restrictions or self-regulation, consumer data privacy and how data is used will be a hot issue. All ACR players will need to stay ahead of regulation by making opt-in transparent to users and terms of use as clear as possible.

What Now?

By 2021, according to eMarketer, there will be about 114 million Smart TVs in the U.S.—enabled by ACR-capable devices like Roku and Apple TV. ACR is about data, viewability and addressability – all adding obvious value for advertisers and content providers. However, any growth will happen only if consumer benefits like content search, ad relevancy and a saner volume and frequency of ad messages justify viewer decisions to opt-into the ACR process.