Mike Woods, Founder and CEO of OrkaTV

David McBee: Hello and welcome to Simpli.fi TV. I am David McBee. Our guest today is Mike Woods, founder and CEO of OrkaTV. Mike is one of the chief architects of the current revolution in television streaming TV. As an executive at Maker Studios, Disney, Wurl, and Amagi, he helped create the fabric tech used by worldwide streaming leaders that powers 24 by 7 linear fast channels. In 2021, he founded OrkaTV with a vision to deliver on the promise of streaming TV. The company started with Orka Ads, which connects prestige brand name television with advertisers in an exclusive streaming TV ad marketplace. Mike, welcome to Simpli.fi TV. Mike Woods: Thanks David. It's great to be here with you. David McBee: I'm so glad to have you, Mike. I remember seeing a statistic from Nielsen in July of 2022 that reported that for the first time ever, Americans were watching more streaming content than broadcast or cable TV. But here we are a year later and Insider Intelligence is reporting that this year US CTV ad spend will be around $25 billion while linear will still exceed 61 billion. So I have two questions for you. One, why hasn't CTV ad spend caught up with consumption? And two, what needs to happen for CTV ad spend to overtake linear TV and cable TV? Mike Woods: I think it's even more than a $24 billion question there, David. But it's a critical one out there in the industry. It's one that everyone is grappling with. And to me it goes to a bit of the nature of what television is today. If you think back a few years, television was fairly homogenous. It was a big screen on the wall and it had linear channels that were delivered through well-known pipes. You had broadcasters and networks. The television signal went out through proprietary cable pipes to proprietary cable set top box and onto the viewer. It was a fairly homogenous thing. That was television. And then outside of television, you had other things. We had the web crank came up, we had broader digital marketing. Then digital video came around. The dichotomy that we see today now is that what is television is shifting. The television set is no longer a homogenous thing that we call television. It's been fragmented into a bunch of different pieces and players and things. In fact, you can play games on your TV set now straight out of the TVOS. Is that television? I'm not a buyer. I'm not buying a Sudoku game, that's television. It starts making us really grapple with what is the nature of television today and what is happening underneath the covers that's really breaking that apart. And we're seeing a lot of viewership in zones that simply don't have ad spent. Think about Netflix until very recently. I guarantee a lot of that streaming time is on Netflix. How much ad space is being sold there? How many other of the proprietary walled gardens of SVOD services that falls into that viewership camp where it gets walled off and we don't actually have access to it from an advertising perspective? Today, some of those barriers are falling down. So it'll be interesting to see out over the next couple of years how fast can we break down some of those barriers and actually access that viewing time and even make it viable to be sold. So you start looking out there, what is television? It's changing. It's fragmenting up into things that we can address with advertising, things that we simply can't. We've had Roku, Apple was the original center here. Apple came out with Apple TV a bunch of years back and brought the app store to the TV set. So this was the crossover between this app concept and TVs. And to me, when we start pushing on what things mean, what television means, CTV to me means an app store on a TV set. But app stores are not homogenous. You've got all sorts of different things that can come out of that now. Some of it is great content, some of it is clearly television and some of it's a Sudoku game that fun but not television. So it stresses and it strains us, right? How do we even know what television is? How do we know how to direct our advertising in this new fragmented world? That's the real challenge out there today, is that the fabric tech behind television has changed and it allows a whole mix of new things to happen out there that appear on the TV set and it becomes a challenge to start parsing apart now what is truly television? What is not and how do we buy against it? How do we bring our ad messaging into this new crazy medium in the best way? David McBee: So what you're saying is a big screen TV is like a giant smartphone almost. And the irony there is that a smartphone isn't a phone anymore. It's so much more than a phone. Mike Woods: That's right. David McBee: But the big question I think that viewers might have is how do we deal with all this? What do media buyers need to know when it comes to streaming TV to do the best thing they can for their clients? Mike Woods: That's the correct question, is as we see... My background is that I built a bunch of the fabric tech out there that powers the space. Having to grapple with it from that very nitty-gritty technical layer up into now the ad stack and how do we bring ads effectively into the space formed a lot of my views on this. And it's because at the end of the day, how the tech works underneath the covers determines what we can do in advertising. So let me give you an example. If we want to advertise on traditional television, we go by a slot. Because of the television signal is broadcast to a headend or that signal is taken to a broadcast tower, once it reaches the headend or that broadcast tower, that signal, the exact same signal goes to every single viewer. So if we advertise, we buy one slide, insufficient, right? Because we get millions of eyeballs. So in terms of reaching people, that top of the funnel brand awareness reach has been the driver behind television advertising. I can buy that slide and get millions of eyeballs. Programmatic digital has been the other side of that spectrum. Programmatic digital has been about how do I search through millions and millions of different websites, millions of different apps and hone into just the right few people that I want, get my message out to them? If I reach that cell phone in my hand, if an advertiser reaches that cell phone, it's pretty likely it's me. So searching through that audience, finding that person, and then we can track because hey, you click on it, you touch it, you then can retarget, you can see where people go with the cookies that are placed in other ways of working with the ad stack to attribute that those ads actually converge to spend. We get return on ad spend, we get other performance metrics that become the benchmark and the philosophy behind that programmatic digital advertising. So what we've done in television now is we've messed with the underpinnings of television. We've taken television out of that proprietary stack and made it digital. The caveat under the covers is that now we've got a one-to-one connection with the viewers. So when people are watching on streaming TV, now we've got that one-to-one connection. So that signal is a unique signal between the channel that is being played at my TV screen versus, David, your TV screen. And in that case, that gives us the opportunity now to target the ads, to use our digital techniques and target ads into an individual viewer. But the business philosophy is still television. And when you step back from that, you go, "Wait, I'm reaching people. And the people are involved in not a tech space, they're not doing it, the people aren't doing something techie. They're watching television, they have a human activity." And the win in advertising is when we align the message and the advertising with people in the right human activities. So we start finding that in order to match campaigns and effectiveness of advertising, we need to tie into those human activities. The human activities are fragmenting across the tech. It's no longer that really clean television is one zone, going and watching TV, versus another zone that's programmatic digital is everything else. Now these are being mashed up on the TV set and TV is being mashed onto other devices. And so it starts creating this messy zone. The goal from an advertiser side is finding the ways to reach people into the activity zones that resonate with a style of messaging that you ought to accomplish. So parsing this apart, if I'm Coca-Cola and I simply want my brand name in front of every human on earth, that's classic top of the funnel brand advertising. I want to splash that all over streaming TV. If I'm a performance marketer that has grown my company by really targeted selling on social media, but if you take that return on ad spend model and you say, "Hey, I want to take that into CTV. CTV is the cool new thing. I want to bring my performance marketing campaign into CTV. Well, TV is an activity that isn't conducive to I'm going to stop what I'm doing and click on that ad and go buy a product." So you're entering out a human activity that disconnects from the advertising format and you're going to be challenged in that. I think that in the immediate term, understanding where the zones are of television, what happens on a TV set that is truly television, the reason to advertise there is classic television reasons. It's about reaching the eyeballs, about getting top of the funnel brand awareness, getting your message out there and using that to improve lower funnel results and other performance marketing in other areas. There's other zones where you're interactive on the TV side and you're playing that Sudoku game. You're not in that lie back watching television activity zone. You're doing something else. These are zones that performance marketing may really shine. And so it's starting to pick apart what happens on the big screen. Stopping to think of it as a holistic one-size-fits-all approach that CTV is a magic zone that has one answer, but realizing that it's a cross up zone now and that we want to start honing in on where the human activities are that match our advertising message and tailoring our campaigns to fit them. David McBee: That is a lot of amazing information, Mike. Thank you very much for sharing that. I could probably talk to you for an hour, but we're over on time, so I'm just going to ask you to let people know what's the best way for them to catch up with you online. Mike Woods: The best way to find us is at orka.tv. That's O-R-K-A.tv, and we'd love to hear from everyone. David McBee: Mike, thank you and thanks for being my guest today. Mike Woods: Thanks, David. David McBee: And thank you all for watching. Simpli.fi TV is sponsored by Simpli.fi, helping you to maximize relevance and multiply results with our industry leading, media buying, and workflow solutions. For more information, visit simply.fi. Thanks for joining us today. I'm David McBee. Be awesome and we'll see you next time.