Commentary

OTA Fastest-Growing Acronym In Premium Video Advertising -- NOT OTT

  • by , Featured Contributor, March 21, 2019

The following post was previously published in an earlier edition of Media Insider.

Heroes & Icons, Bounce, Escape, Laugh, Grit, Comet and MeTV. Do you know those TV network brands? You should. Millions of viewers across the U.S. are now watching those networks and their over-the-air brethren on a daily basis, and they are growing fast.

OTT (over-the-top) and CTV (connected TV) may be the buzziest three-letter acronyms in the world of video advertising today, but neither of them have the audience nor ad-load scale that OTA networks are enjoying today. The only difference is that OTA is happening under the radar.

When commercial television took off in the U.S. in the 1940s, it was a pure broadcast service, delivered over the airways from station-owned transmission towers to home- and set-based antennas. Over the succeeding decades, pure broadcast was superseded by cable, satellite and teleco delivery for the vast majority of U.S. homes. At that point, pure OTA delivery became a largely forgotten and ignored portion of the TV ecosystem for many in the ad community.

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On June 12, 2009, all TV broadcasters flipped the switch from analog to digital and everything began to change. TV stations were assigned new bandwidth that multiplied the number of channels they could broadcast, the digital TV antenna was introduced, and some very entrepreneurial companies and executives started new national TV networks by cobbling together these multicast digital positions from the different local stations.

While some time passed for these efforts to reach critical mass, we wait no more. In a just-released study, Nielsen reported that there are now 16 million OTA households in the U.S., up 50% over the past eight years and at an accelerating growth rate.

Check out “TV antenna” on Google Trends. Searches for the term are up 4X over the past eight years.

Why? A particularly fascinating finding in the Nielsen report is that a significant segment of OTA viewers also subscribes to a streaming video service, apparently using OTA networks to complement their viewing on Netflix, Hulu and Amazon Prime to fill the gap when they “cut the cord” on cable.

While there has been so much attention paid -- appropriately --  to all of the many initiatives to sell new paid subscriptions streaming video services, from Disney + to Hulu to planned services from AT&T and NBCUniversal, there hasn’t been nearly as much attention on the many successful efforts to build up valuable, ad-supported services on OTA. I’m sure this is going to change fast.

These networks are free to viewers, so their ad load represents a real growth opportunity in the premium video advertising space at a time when more traditional broadcast and cable networks are losing audience and ad load.  

Just over a year ago, local broadcast station owner E.W. Scripps bought Katz Networks (the owner of OTA nets Bounce, Grit, Escape and Laff) for $302 million. Today, Katz is already the fastest-growing portion of the Scripps business and last month announced that it had bought the brand and assets of Court TV to relaunch it as a new OTA network.

Just yesterday, the country’s largest TV station owner, Sinclair, announced the launch of STIRR, a free, ad-supported streaming video service that will aggregate content from many of these OTA channels. Sinclair already owns OTA brands like Comet and Charge! and cable programmer Tennis Channel.

There's no question that OTT and CTV are three-letter acronyms that deserve your attention. But if you care about the future of premium video advertising, you should be paying even more attention to the world of OTA. What do you think?

4 comments about "OTA Fastest-Growing Acronym In Premium Video Advertising -- NOT OTT".
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  1. Bob Gordon from The Auto Channel, March 21, 2019 at 3:41 p.m.

    For over 12 years we hav been trying to convince TV station owners to grow involvement with their car dealers by converting a throwaway digital channel into our unique local advertising focused automotive TV program service "The Auto Channel" on a barter basis...The stations involement with theri number one local advertisers will rocket their revenue, open desireable inventory and create a promotional platforn that no other station in their market can compete with... and provide The Auto Channel in each market with online content they can share with the participating dealers...maybe now that OTA buzzing smart station owners will fineally listent to a bunch of local TV guys...

  2. Bob Gordon from The Auto Channel, March 21, 2019 at 3:48 p.m.

    https://www.youtube.com/watch?v=IhECRMpIDWI

    The Auto Channel TACH-TV Demo...
    bgordon@theautochannel.com

  3. Tony Reynolds from A KickIn Crowd, March 22, 2019 at 2:55 p.m.

    Great read Dave. Ironically, at first glance, I thought you were another Dave Morgan, at Litton has played a role in the growth of the E/I segment of OTA.

    It will be interesting to see how, if any, impact ATSC 3.0 wll have on programming.

    Does you know of if there is any barter/sponsor/ad platform, or software for independent programming?

  4. Bob Gordon from The Auto Channel replied, March 25, 2019 at 3:19 p.m.

    see above comment...the auto channnel more than programming... gets local auto dealers very involved with your staion on an exclusive basis

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