Before we begin analyzing eMarketer’s report, we need to clarify what is meant when we speak of connected TV devices. eMarketer defines connected TV as “TV sets connected to the internet through built-in internet capability or through another device such as a Blu-ray player, game console or set-top box (STB).” In other words, a connected TV device uses the internet to stream content to your television. It has been reported that by next year, over 50% of the US population will be streaming content through connected TV devices. To put that in perspective, that means more than 160 million people in the US will be watching streamable content on their televisions. For a technology that isn’t even 10 years, that’s very impressive.
Three key discoveries were highlighted in eMarketer’s report this morning. US household penetration will reach 78% in 2019, which amounts to 97.3 million households. Connected TV viewing habits are the most similar to linear TV habits, revealing that primetime is peak time for connected TV ad requests. And finally, on Tremor’s Video platform, from 8-11 pm, connected TV had the most daily ad requests (22%) among smart-phones, tablets and desktops.
How do we extrapolate this data? Since US household penetration will reach 78% in 2019, we will likely see growth in branded streaming apps and possibly more of a diversity of STB options. Will these new STB devices be as comprehensive as Roku & Apple TV? Perhaps not. They could be more specialized in terms of trying to reach a certain consumer. On the other hand, existing STBs like Roku & Apple TV could start releasing devices that have apps pre-loaded as a way of reaching a specific clientele.
With connected TV not only having the most daily ad requests among smart-phones, tablets and desktops, but also during primetime, how will AVOD service providers respond? Trying to create content that might be more popular during primetime is not necessarily the best approach. It would be risky to make streamable content time-specific. Streamable content should be desirable to watch no matter what time of day it is. Since daily ad requests on connected TV are highest in primetime, attaching ads that do well in primetime on Linear TV might be a worthwhile approach.
The connected TV takeover is fast-approaching, so content creators need to start thinking about how to stand out in this market.