Most folks aren’t aware that cable advertisers sell ads in their broadcasts.   Its fairly self evident if you think about it – pretty much everyone has seen an ad for their local gas station, dentist or plumbing supply shop.   But most don’t really realize that these ads are being hawked by their cable company.   The way this works is really quite simple.   Per hour of programming on a particular channel the cable company is allowed to “swap” out certain national ads with thier own ad units.

The way this works is via a process called Digital Program Insertion or DPI.  Essentially the broadcasters insert a signal a couple of seconds before a replaceable ad that says “hey an ad you can replace is coming”.  When the ad occurs it sends another signal saying “replace now”.  If everything works as it should then the existing ad is replaced with the new ad and no one’s the wiser.   There is about a 2 second threshold however where the splice can get a bit funky and sometimes you will see bleed from the old ad before the inserted one starts – but this is getting to be pretty rare.

One of the big upsides to this type of advertisers is that it allows for a pretty precise targeting of ads by geography.  Its really up to the cable operators to decide how granular they want splices to occur.