The following video provides an overview of commercial models for TV and video, the rise of digital video, and the growth of ad loads. It’s the second in a series of educational videos Furious has produced in collaboration with Beet.TV. To explore Furious’s TV 101 Dictionary, which is a companion piece to this series, please click here. Here’s a sampling of Part 2:
Going back four decades now, the TV industry limited the amount of advertising shown to viewers to 9½ minutes per hour, but it was forced to abandon this self-regulation in 1982. (The Department of Justice supposedly objected to “fixed” amounts of advertising on the grounds that it controlled supply and drove up price.)
The upward creep of ad loads ever since is an affront to viewers that’s detrimental to every player in the TV value chain, including advertisers. First came infomercials, and then the cable TV industry arrived with lower unit pricing based on more commercials. From there, the broadcast networks promptly coopted the idea of larger ad loads.
Meanwhile, technology evolved to help audiences contend with greater ad loads—and evade advertising altogether. Digital video recording devices came along, allowing viewers to record and then replay programs while fast-forwarding through commercials. Then there was TiVo. Today, we have streaming video services at scale that offer specially priced subscriptions for unlimited viewing of ad-free TV and movies on demand—led by Netflix.
Titans of linear TV advertising have periodically vowed to deliver smaller ad loads. But a 2018 UBS study contends that all major cable groups are at or near all-time clutter highs, with the exception of NBCU’s cable networks.
Meanwhile, advertising-based video on demand (AVOD) is growing sharply. Global revenue from AVOD distribution will nearly triple from $21.9 billion in 2018 to around $56 billion by 2024, according to a projection from Digital TV Research.
Here’s the big question: As ads continue to flood the media ecosystem, will they start to lose effectiveness?
To learn more about ad loads and commercial models for TV and video, please click here.
This video was presented by #BeetU. For more videos from the event, please visit this page.
The original article was published at Beet.TV by on April 8, 2020. The original article can be viewed at https://www.beet.tv/2020/04/beetu-session-2.html.
