I’ve had a half written post about the evolving connected TV ecosystem for well over half a year now, and this week, as I sat down to finally finish it, what popped up but the announcement that Fox is going to buy Roku for a reported $22bn. What are the chances…
This is such an interesting move, and one we are likely to see more of, as well as perhaps strategies by broadcasters, networks and streamers to either compete with or replicate what this combined operation creates for Fox.
I’ve written many posts about the battle for the living room, but often focussed on audiences, and the content choices on the platform, rather than all the other aspects at play behind the scenes.
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In a very broad nutshell, within the connected TV environment, when a user watches a piece of content, there are many companies trying to make money in different ways from that viewing moment. These layers broadly are as follows:
Viewer » TV hardware and operating system » Streaming app of choice » advertising » measurement » audience data.
So, we’ve talked a lot about the viewer, what streaming apps or services they choose to watch, and also a little about there being a battle between operating systems.
However, this post is about some of these other elements in the connected TV market that are less obvious. With the bigger overarching questions being:
Who gets the $184bn of combined global TV advertising spend, especially the $144bn spent on linear broadcasting?
Who owns the data on the audiences?
Which is the company of choice for brands to buy advertising from?
This is such a massive issue, and touches on all sorts I’ve already covered, plus many others. Here are just some of the broad themes:
Issues around shared and transparent measurement
How much ad money is siphoned off before it reaches the platform or content owner
Increasing levels of technical and engineering complexity across the data and ad tech landscape
How much is ad spend is wasted on fraud
Privacy issues around audience data
Anti-trust questions around tech companies owning parts of the market
The national vs global nature of advertising and streaming services
Control of subscription marketplaces on CTVs.
Obviously, as the TV industry transitions to a streaming world, these issues really matter to the future of the entire ecosystem, for everyone including producers, creators, platforms, studios and broadcast networks. Not that all their interests and objectives are aligned.
So, rather than cover all these elements in one post, I thought I’d start by talking about why the Roku deal matters, and then do a general granny-sucking-eggs introduction to the CTV environment. I’ll come back to issues of advertising fraud, measurement, audience privacy and complexity in a future post (and if anyone has thoughts on these issues that they’d like to have shared more widely, please do get in touch).
Alan Wolk is one of (if not the) leading experts in CTV. He says:
The old television gatekeepers controlled access through distribution. The new ones control it through the interface. And in a world where viewers are faced with an endless supply of content, controlling the interface is the power move.
He also has this special report which is important for everyone to read, as who controls the OS controls what gets promoted, what gets watched, and who makes money in the living room.
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