What Display Daily thinks: Whenever I mention ad dollars or software revenues in the TV market, I get a less than laudatory email from a traditionalist display professional who want to talk about color gamuts or their commitments to certain technologies or suppliers, or rehash the latest technology trend.
I get the distinct feeling that TV’s scientists are missing the point: the latest technology trend is software. If Omdia’s projections pan out it begs the question, is there enough money that a Samsung or an LG could throw at its software to come up with a competitive platform to Roku?
I dobut it. The US does software really well. US companies have defined user interfaces and user experience for the world. It is very rare to see a European or Asian company drive software trennds in any category. Tik Tok is an exception and proves that an Asian company can engage with US consumers on their terms meaning, it delivers the experience they want with an interface that they understand. But, Tik Tok is an amalgam of a number of social media platform that have gone before it, and it has not reshaped the user interface.
And another thing, an embedded OS like Teizen or WebOS can’t compete with Roku’s set-top box (STB). If any TV vendor wants to really try and understand how to engage new audiences, maybe they should think about an STB, compete with Roku on its turf. Otherwise, considering the size and investment in CTV advertising that Samsung and LG are capable of, the ROI on their CTV ad business may not inspire much confidence.
As for Walmart and Amazon, I suspect that in the next few years we will be assessing conversion rates from TV usage to shopping on those sites, and there will eb other revenues metrics, as well, maybe even home delivery orders for take out food.
You see, the explorable web, the freely searchable one, is disappearing behind the garden walls of Google, Meta, and Apple. TV is the most direct line to digital consumers.
Could Omdia be underestimating the size of the CTV ad market?
The global TV market is worth about 20 times the expected ad revenues for CTV. So, it might seem a bit dramatic to harp on about its potential. But, could Omdia be underestimating the size of the future market?
Most TV advertising is dominated by big brands and big ad budgets. It’s the nature of the medium. CTV advertising is opening up the market for all possible advertiser – big and small – just like Google did with banner advertising and keyword marketing. It is pretty much the same trajectory for CTV ads. Surely Omdia is underestimating the potential size of the CTV ad market?
I can tell you that everyone underestimated the impact of digital advertising on the web. No one thought it would be so pervasive and so very, very big. In the same vein, how a TV is sold, priced, or profited from will change because of CTV advertising. it can be that big.
Roku Rules CTV Advertising
Omdia is saying, the CTV advertising market is expected to nearly double in size, growing from $6.65 billion in 2024 to $13.5 billion by 2029. Companies like Roku and Samsung are leading the charge by strategically shifting their focus to lucrative revenue streams from CTV platforms, including Free Ad-Supported Streaming TV (FAST), user interface ads, and third-party inventory shares.
Roku is a dominant force in the CTV advertising landscape, particularly in the U.S., the world’s largest advertising market. Currently, Roku powers 20% of all TV sets in the US, giving it a substantial edge in the CTV ad space. It is projected to generate $5 billion in revenue by 2029, with $2.8 billion expected in 2024. Roku’s strategy of accepting losses on hardware sales in exchange for growth in platform revenues places it at the forefront of this growing market.
Samsung, the second-largest player in the CTV market, is projected to more than double its CTV advertising revenues, reaching $3 billion by 2029. Samsung leverages its extensive global reach to maintain competitiveness, especially in markets outside the US, according to Omdia.
Another significant development is Walmart’s acquisition of Vizio, signaling its intention to capitalize on emerging CTV opportunities, including retail media and shoppable TV. The CTV advertising space continues to get more competitive and Roku seems to be staying ahead of the pack despite all challenges to its position.
