Advertising on the big screen is a big deal in the streaming era

Pay-TV may be in decline, but the TV screen remains a valuable piece of real estate for advertisers as more and more premium content gets pulled into various ad-supported streaming apps and direct-to-consumer (DTC) services.

And even as the likes of Netflix, Disney+ and HBO Max open up ad-supported versions of their respective subscription streaming services, the rise of FAST (free advertising-supported television) channels is on the rise, providing consumers with the kind of lean-back and curated experience that mimics many elements of traditional multichannel pay-TV.

The shift to streaming initially tended to focus on getting video content distributed to smartphones, tablets and other mobile devices. But streaming to connected TV platforms has become a central component of any streaming strategy. To wit, the importance of the smart TV platform was clearly evident at last week's CES in Las Vegas, where Xumo (the Comcast-Charter streaming JV), Roku, Xperi/TiVo and Hisense/Vidaa all announced updates on their respective product strategies in tandem with the annual tech-fest.

It's a trend not lost on FreeWheel, the ad-tech specialist that Comcast acquired in 2014.

"We're just seeing more and more competition and innovation in that [connected TV] space," David Dworin, FreeWheel's VP of product management, said on the Light Reading Podcast during last week's show.

He said mobile and watching TV on the go "was the big thing" when he joined the FreeWheel about five years ago. But with the mobile aspect largely solved, "all the growth has been in connected TV," Dworin added. "They [consumers] like that lean-back living room experience ... but with all of the benefits of digital viewing and streaming, right there. We're seeing that in our numbers and in our data. That's definitely where we're leaned in and seeing most of the growth right now."

Like others in its sector, FreeWheel is also seeing an increase in the use of automated, data-driven "programmatic" advertising technologies and techniques, but those types of ad transactions and campaigns still remain in the minority.

"About 85% of what we see is the traditional IO (insertion order) and about 15% programmatic," Dworin said. "But we're expecting programmatic to take off. We think, in the next few years, it will be about half, versus 15% today, because it solves so many problems for everyone."

You can download a lightly edited transcript of the podcast here. If you want to skip around and listen, here are a few topics discussed during this podcast:

  • A review of FreeWheel's ad-tech business and its reach across a wide range of devices and distributors and types of premium content (1:30)
  • What pieces of the puzzle FreeWheel provides in the ad-tech ecosystem (3:45)
  • A look into FreeWheel's top growth engines heading into 2023 and how the company is positioning itself in the fast-growing FAST and connected TV segments (5:30)
  • Automated, programmatic advertising is growing but still represents a minority with respect to how TV ads are bought and sold (7:30)
  • More detail on how advertising in the connected TV arena is becoming a hot commodity (11:00)
  • How audience measurement is evolving in a streaming arena that now has the ability to access and analyze data from set-tops, TV-connected streaming devices and smartphones (13:00)

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— Jeff Baumgartner, Senior Editor, Light Reading

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