Internet video viewing accounts for 20 percent of all content viewed on broadband-household TV sets – an average 3.8 hours per week, according to Parks Associates’ ¨Tracking Eyeballs: Video Analytics and Measurement¨ market research report. As that number rises so do concerns on the part of advertisers, pay-TV and OTT service providers about consumers’ OTT video ad blocking.
According to Parks’ analysts the best defense is to develop integrated digital advertising-content viewing models that are not intrusive and don’t otherwise detract from the viewing experience.
“Many content creators rely on advertising revenue to monetize video, especially as newly launched digital services seek revenue. As digital video viewership increases on all screens, use of ad-blocking technologies is a concern for content owners and distributors,” Parks Associates’ research analyst Glenn Hower commented for a press release about the OTT video ad blocking analysis.
OTT Video Ad Blocking
“Ad blockers have their roots in web publishing, often to prevent full-page overlays or popups that would disrupt the experience. As Internet video viewership on the television screen increases, advertisers are seeking to leverage prime living room real estate in this new media model. Content and OTT providers and advertisers need to ensure their methods do not interfere with the viewing experience, which would otherwise drive viewers to ad-blocking technologies.”
- Ad blocking cost the digital publishing industries an estimated $41.4 billion worldwide in 2015.
- Internet video viewership increased by a five-year CAGR of over 18% from 2010 to 2015.
- The total number of OTT video services has tripled from 2010 to 2015.
Interest in dynamic ad insertion is rising as the number and use of personalized OTT services has increased. Automated media buying and selling and the necessity of generating advertising revenues to successfully do business in low-income markets are likewise contributing to the trend, Parks says.
That notwithstanding, Parks forecasts total digital video advertising revenue will increase from $14.4 billion in 2016 to $28.9 billion in 2020, a five-year CAGR of 15 percent.
“Connecting advertisers with appropriate, and accepting, audiences is a significant challenge for ad-supported video providers,” Hower said. “The reward, however, is more meaningful ad messages to consumers, with greater impact, response, and brand retentions. Another reward is more valuable media inventory for both content and service providers and their advertising partners.”