TV’s Ad Rev Is Beginning The OTT Migration
It’s no secret that we’re shifting our video consumption from linear TV to OTT streaming. We’re streaming more shows online instead of watching traditional TV than ever before. And as our online consumption increases ad dollars are inevitably following. For a snapshot of how ad spending is shifting from traditional TV to digital video, and a forecast about what’s to come over the next few years, check out the infographic below from Convergence Research. As you can see, TV spending is expected to peak in 2018 and then begin a slow decline.
Despite linear TV’s predicted revenue decline the total amount of video spending is still going up. Since OTT rev will grow by several billion per year for the foreseeable future those increases will far outweigh traditional TV’s decline. So the total video ad revenue pie is actually still growing, but now it’s being fragmented with more and more streamers taking a slice. It’s actually reminiscent of the 1990s, when the Big Four networks (ABC, CBS, NBC and Fox), had to suddenly make room for dozens of new cable upstarts at the revenue table.
What’s that saying about history repeating itself?