Price-Waterhouse-Cooper (PWC) TV Advertising Insights

TV advertising

 

TV advertising markets by growth and scale

View the infographic

US dominates online TV advertising from traditional broadcasters

Multichannel and online share on an upwards trajectory, as terrestrial falls

Key insights at a glance

1

Despite the growth of digital media, TV advertising remains the place to be. Global TV advertising revenue is successfully responding to the rise of newer forms of digital media. Global TV advertising revenue will grow at a CAGR of 5.5% over the next five years, confirming TV as the ‘place to be’ for advertisers looking to reach big audiences.

 

2

Online TV advertising will double its share of total TV advertising revenue in the next five years.Online TV advertising revenue from traditional broadcasters will increase from US$3.7bn in 2013 to US$9.7bn in 2018, and more than double its share of total TV advertising from 2.2% in 2013 to 4.5% in 2018. Traditional broadcasters still dominate and are adapting to the online video opportunity, so creating themselves a significant new revenue stream, despite competition from Internet rivals.

 

3

Terrestrial’s share of advertising will fall as multichannel and online grow. Terrestrial TV is the primary contributor to advertising revenues, but its share of the TV advertising market will fall from 73% in 2013 to 68% in 2018. Multichannel’s share, by contrast, will grow from 25% to 27%, while online TV advertising’s share will rise from 2.2% in 2013 to 4.5% in 2018.

 

4

Failure to embrace new audience measurement metrics will see TV lose advertising revenue to other digital media players. Even in the most advanced TV markets, broadcasters and advertisers are still unclear how audiences consume their content. Digital media metrics will quickly gain ground in the next five years and despite the apparent resilience of the current TV model, existing players need to adopt new metrics if they are to compete for advertising revenue in the long term.

 

5

TV advertising’s future development depends on current legal cases. The outcome of ongoing legal cases will significantly impact future TV business models. For example, Aereo’s Internet distribution model – and other controversies such as ‘net neutrality’ and Dish’s ‘Hopper DVR’ – have the potential to significantly impact traditional TV advertising models.