Local TV over-the-top ad revenue should rise about 43% in 2019 to $857 million, reaching $2.13 billion in five years, according to BIA Advisory Services.
BIA released its ad forecast at the TVB Forward 2019 Conference in New York.
“OTT offers a considerable opportunity for broadcasters to grow revenue,” said BIA founder and CEO Tom Buono in a press release. “As consumers shift their viewing habits, it’s an opportunity to extend the value of traditional over-the-air content. We’ve added OTT to our forecast to track this growing area and scope the revenue opportunity.”
BIA's ad forecast focuses on the local activation of OTT video impressions on Connected TVs. This ad inventory can be both competitive and complementary, in the case of TV groups, for local linear TV ad budgets including local TV and local cable.
BIA defines OTT advertising as locally targeted advertising included on streaming video that is delivered to TV sets via internet connections.
“The industry has reached a stage where there are several existing and emerging OTT players that have a high growth potential,” BIA chief economist and senior VP Mark Fratrik said in the release. “By partnering with them, broadcasters can drive new revenue by delivering their valuable content and diverse audiences. I believe we’re at the tip of the opportunity and we’re working closely with OTT firms to analyze revenue opportunities.”
BIA is scheduled to release its U.S. Local Advertising Forecast for 16 different media, including OTT, in early October. The forecast is available for all 210 local television markets and is based on a proprietary forecasting methodology of the local advertising marketplace.