• by Dave Morgan , Featured Contributor, 2 hours ago

According to Nielsen’s Gauge, just about one-half of all viewing on TV in the U.S. is still delivered by cable, broadcast, or satellite.  And more than 80% of all TV ad viewing time is also linear, since so much streaming viewing is on ad-free or ad-light services.

Most analysts don’t expect to see even 75% of ad viewing time on streaming until well into the 2030s. So, if you are an independent digital ad buying platform hoping to capture revenue growth from the burgeoning CTV ad market, you have a problem. You are stuck between the proverbial rock and a hard place.

The "rock" is the fast-growing video ad businesses of walled gardens Amazon Prime and Google/Youtube sucking up much of the true CTV ad growth, neither of which need your platform. And the “hard place” is the fact that the better part of $50 billion of U.S. premium video ad spend is still captured by linear TV companies, and digital ad platforms are totally shut out of that spend. None have any linear TV ad buying capabilities, possessing neither data-driven linear targeting and measurement tools, nor automated capabilities for planning, buying and reconciliation.

Sure, streaming ads will grow and linear TV ads will decline, but not nearly as fast as the space between the rock and the hard place will compress for the digital ad platforms.

Just read any of the top Wall Street analysts covering The Trade Desk. Price competition from Amazon and Google is growing by the day (and don’t forget Walmart is moving fast into TV video, let alone the growing competition from social video). Consequently, platforms like The Trade Desk no longer have large “green fields” of unimpeded growth in front of them.

Programmatic banner ad volume and margins are collapsing. The vast majority of premium CTV ad inventory is controlled by a limited number of players, and most buyers want guaranteed deals in advance, frequently based on content, not audience, and don’t  need overbuilt bidding, billing and data exchange platforms to manage these deals.

All the major digital players are fighting over streaming ad growth, and there just isn’t enough to go around.

Of course, if linear TV distribution suddenly fell off a cliff, it would be a different story.

Net, net: Anyone not a walled garden is going to have to find a way to capture and manage linear TV ad inventory and transactions directly -- and now, because most won’t find enough growth in competition with walled gardens to make it for another seven to 10 years, when linear TV ad channels finally become irrelevant.

For sure, digital ad platforms are frustrated by linear TV’s resilience. They can't grow at the speed public investors demand without that video audience and ad revenue. What do you think?