Analysis from MoffettNathanson, based on Magna Global estimates, forecasts that U.S. Internet/online video will see a 24% average annual ad revenue growth rate, rising to $20.4 billion in 2021 — from $7 billion in 2016.
At the same time, traditional U.S. TV spending will have a 2% average annual ad revenue decline per year, totaling $60.4 billion. That is down from $67.1 billion in 2016.
Other non-video digital media will continue its rapid rise — with an annual average ad growth rate of 9%, growing to $100.4 billion. It was $65.4 billion in 2016.
Completing the total U.S. ad-spend picture, other non-TV traditional media will sink by 8% annually, down to $28.6 billion from $42.5 billion in 2016.
Overall estimates are that U.S. total advertising spending will grow 3% annually, to reach $209.7 billion — from $182 billion in 2016.
This year, MoffettNathanson estimates one of the biggest digital-video generators — YouTube — will gross $11 billion a year in revenue, netting $5 billion after factoring in YouTube's revenue split with content creators.
Even with strong online digital video growth, the research company says the online video business needs to improve in five areas: greater reach, better engagement, more high-quality produced video, improved measurement and better brand safety.