This year connected TV overtook mobile as the screen on which the most digital video impressions were served. However, as the hype around streaming settles into a legitimate channel for advertisers and publishers, there are some myths to be dispelled around “connected TV,” the catchall term for videos streamed over the internet and watched on a TV screen.
Myth: Connected TV and OTT are the same thing
Connected TV refers to the device on which someone is watching a video or an ad, whereas OTT (over-the-top) refers to how that video or ad was delivered. OTT predates connected TV and originated as a way to describe TV networks letting people watch their shows online, bypassing the cable or satellite TV box (why the term is “over the top” not “over the internet,” I have no idea). If someone is streaming Hulu through its mobile app, they are accessing that content over the top and watching it on their phone or tablet; if someone is streaming Hulu through its app installed on their Samsung smart TV, they are accessing that content over the top and watching it on their connected TV.
Myth: There is a lot of TV-quality inventory available on connected TV
For as many apps as there are available across connected TV platforms like Apple TV, Roku and Amazon Fire TV, four apps account for 75 percent of time that people spend streaming video on their connected TVs, according to Comscore: Netflix, Amazon Prime Video, Hulu and YouTube. Two of those apps — Netflix and Amazon Prime Video — do not carry ads, while Hulu and YouTube each offer ad-free subscriptions in addition to their standard ad-supported services.
“There’s still a very limited amount that is truly ad-supported on a volume basis relative to TV. A lot is no ads or few ads. The idea that there’s this massive growing pool of premium video inventory on connected TVs is not the case,” said Dave Morgan, CEO of Simulmedia.
Myth: Connected TV inventory is cheap
The connected TV inventory that is available is significantly more expensive than digital video and on par with linear TV. “There is a little bit of sticker shock,” said Ari Paparo, CEO of ad tech firm Beeswax. Connected TV CPMs average in the mid-$20s, which is comparable to linear TV, and can even be slightly higher than linear TV prices, said Raphael Rivilla, partner for media and connections planning at Marcus Thomas.