What Is Connected TV (CTV)

Connected TV refers to TV sets that are connected to the internet. This allows viewers to access online content and streaming services on their TV screens.

CTVs have become increasingly popular in recent years with the growth of video streaming services like Netflix, Hulu, and Amazon Prime.

Major TV manufacturers like Samsung, LG, Sony, and Vizio now offer smart TVs with built-in Wi-Fi and apps to facilitate access to online content. 

The rise of CTV presents new opportunities for content creators, advertisers, and consumers. For media companies, it provides a way to directly reach cord-cutters who are shifting away from traditional cable/satellite TV.

For advertisers, it offers more targeted advertising capabilities based on data collected about viewers’ interests and habits.

For consumers, it expands the amount of entertainment options available on the biggest screen in their homes. The CTV market is still evolving but has established itself as an integral part of the media landscape.

Connected TV (CTV)

Growth of the CTV Market

The global CTV market has seen rapid growth in recent years, driven by several factors. Firstly, declining prices and improving features of smart TVs have led to higher adoption rates.

As per research, global CTV device shipments grew by 50% year-over-year in 2020 to reach 260 million units. Secondly, the expansion of high-speed broadband along with the 5G rollout provides the connectivity needed for streaming services.

Thirdly, over-the-top (OTT) media services like Netflix, Amazon Prime Video, Hulu, etc. have risen enormously, enticing consumers to cut cable/satellite connections.

According to eMarketer, there were 613.3 million CTV users worldwide in 2022, a figure projected to reach 762.7 million by 2025.

Finally, CTV platforms enable customised ad targeting based on user data like location, content viewing habits, past purchases, etc. This propels ad investment, contributing to CTV market growth.

CTV Platforms and Devices

There are two primary ways to access CTV – through smart TV sets with pre-installed apps or through external streaming devices that connect to standard TVs like Roku, Amazon Fire TV, Apple TV, etc.

Leading smart TV makers including Samsung, LG, Sony, Vizio, TCL, and others incorporate popular apps like YouTube, Netflix, Hulu, Prime Video, etc. This eliminates the need for external devices.

Streaming devices starting at $20 provide a budget route to convert existing TVs into smart CTVs. Roku and Fire TV have over 50% market share in the US streaming device market.

Gaming consoles like Xbox and PlayStation also double up as CTV devices. Android TV, Apple tvOS, Tizen, webOS, Roku OS, etc. are the main CTV platforms powering smart TV or streaming device ecosystems.

Each has its own content app store, user interface, and features.

CTV Advertising

CTV provides unique advertising opportunities compared to traditional television. Firstly, it allows more precise targeting – advertisers can zero in on specific consumer segments based on viewing habits, geography, device details, etc.

Secondly, interactivity allows customizable product recommendations, clickable ads, mini-surveys, etc. which are not possible on broadcast TV.

Thirdly, advanced reporting provides detailed campaign performance data like ad impressions, clicks, conversions, etc.

Fourthly, options like frequency capping, competitive separation, and daypart targeting provide flexibility.

And finally, opportunities like shoppable ads take it closer to e-commerce. Programmatic ad-buying platforms like The Trade Desk are emerging to make CTV ad buying simpler.

Deloitte predicts over 50% of US TV ad budgets will be spent on CTV advertising by 2025, highlighting its immense potential.

Benefits of CTV for Consumers

For consumers, CTV offers myriad benefits that enhance the entertainment experience:

  • Access to a catalog of streaming content like original series, movies, sports, etc. from services like Netflix, Prime Video, Hulu, etc.
  • Ability to watch content on demand rather than being limited by broadcast schedules.
  • Personalized recommendations based on viewing history and preferences.
  • Options to subscribe/unsubscribe from streaming services anytime, unlike rigid cable TV contracts.
  • Family profiles and parental control features on most platforms.
  • Pausing, rewinding, and replay features for live content like news, sports events, etc.
  • Casting or screen mirroring capability to view mobile content on big screens.
  • Voice controls through digital assistants like Alexa, Google Assistant, Siri, etc.
  • Access to music streaming through apps like Spotify, Apple Music, etc.
  • Web browsing capability and access to social media apps like YouTube, Facebook, etc.

Challenges for the CTV Industry

Though CTV presents immense opportunities, there are challenges to be overcome:

  • Fragmentation – lack of standardization across various CTV platforms, devices, and app ecosystems poses difficulties for developers.
  • Advertising limitations – lack of common metrics for cross-platform measurement of ad campaigns.
  • Discoverability – enabling users to easily find relevant content from vast catalogs.
  • Monetization – balancing ad loads and subscriptions without affecting user experience.
  • Data privacy – transparent data collection policies needed to maintain user trust.
  • Internet requirements – reliable high-speed broadband connectivity needed for smooth streaming.
  • Piracy – preventing the illegal distribution of premium streaming content via CTV devices.
  • Competing with cable/satellite TV operators who bundle CTV platforms – making it difficult for standalone apps.
  • Driving consumer adoption of new CTV features like shoppable ads, interactive content, etc.

The CTV ecosystem is evolving rapidly and overcoming these challenges will be key for its continued expansion.

Frequently Asked Questions (FAQ)

Q1. What is CTV?

Ans. CTV or Connected TV refers to television sets that are connected to the internet. This allows users to access online streaming content and apps directly through their TV screens.

Q2. How is CTV different from regular cable TV?

Ans. Unlike regular cable TV with preset channels, CTV allows on-demand access to streaming services like Netflix, Prime Video, etc. It also enables interactive features and provides personalized recommendations based on viewing history.

Q3. What are the popular CTV platforms?

Ans. Major CTV platforms include Roku, Amazon Fire TV, Apple tvOS, Android TV, LG webOS, Samsung Tizen, etc. Each has its own operating system, app store, and user interface.

Q4. How can ads be shown on CTV platforms?

Ans. CTV allows very targeted and interactive ad experiences through options like programmatic ad buying, frequency capping, competitive separation, and advanced reporting of campaign metrics like impressions, clicks, and conversions.

Q5. What are the benefits of CTV for consumers?

Ans. CTV offers consumers greater choice and control over entertainment content. Key benefits include on-demand access, the ability to personalize, flexible subscriptions, advanced features like the ability to pause or rewind live TV, and cast or mirror mobile content to the big screen

Andrea Wilson
Andrea Wilson

Andrea Wilson is an expert in finding simple and cost-effective alternatives to traditional TV. With years under her belt, she's a trusted voice in the cord-cutting community.

She has dedicated countless hours to in-depth research, guiding viewers how to stream their favourite shows without a cable subscription. she's an avid hiker, a mystery novel enthusiast and a dog lover.