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TV Viewers Shift Towards Ad-Supported CTV Content Over Linear Television

Lauren Forristal

The momentum of television is moving towards ad-supported programming, more specifically Connected TV (Xbox, PlayStation,Roku, Amazon Fire TV, Apple TV). A Magnite study shows that 55 million U.S. households solely watch Connected TV. This means that 40% of TV users in the U.S. are watching advertisements exclusively through CTV rather than traditional linear TV.

Featured in a Next TV article, Magnite’s chief revenue officer for CTV, Sean Buckley, concludes, “CTV is now much more than just an audience extension tool or an add-on to a linear buy because it’s clear that a large portion of TV viewers have shifted their attention in favor of CTV,” he also says, “Our goal in conducting this research is to help media owners and advertisers understand how they can use CTV to reach CTV viewers effectively, authentically, and respectfully.”

47% of CTV viewers watch ad-supported content. That popularity may explain why we’re seeing more ad-supported tiers on services like HBO Max and Paramount+. CTV viewers watch an almost equal amount of ad-supported content as well as ad-free.

Free ad-supported streaming services are seeing the most growth. Services like Pluto TV, Roku Channel, and Tubi are on the rise. The FAST industry is currently worth $2.1 billion and will most likely double in 2023.

In addition, a study from Roku and Harris finds that 86% of consumers are streaming, and 1/3 don’t own a traditional TV component whatsoever. Even more interesting, the study shows that U.S. viewers watch 78 minutes more of digital streaming video than cable or broadcast. Also, a little less than half of consumers have reported that they have interacted with ads while streaming.

On the other side of the terrain, traditional TV viewership has declined. Industry giants like Disney, WarnerMedia, and NBCUniversal, who provide both types of content, are finding themselves in a bit of a pickle when it comes to which content goes where.

A veteran broadcast television executive says, “It’s the innovator’s dilemma in action…You know the linear TV world is collapsing, but you’re trying to stay on the Titanic for as long as possible. At the same time, you’re setting up the lifeboats, which are digital and streaming.”

Linear TV digs its heels in the ground as it is being gradually pushed towards a cliff. Industry giants try to keep it afloat but it’s painfully clear that Connected TV has taken over. It’s only a matter of time when traditional TV can no longer keep up with the progressive and competitive TV landscape.

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