Shift from traditional TV to streaming TV will solidify over the next decade: Rajib Basu

The connected ecosystem has made accessing content on multiple devices simple and affordable, bringing people closer worldwide. The explosion of Connected TV thus makes it crucial for advertisers and marketers to gear themselves to master the emerging technology and to get future-ready. exchange4media’s flagship event Connected TV Conference brought together industry stakeholders to discuss how impactful CTV advertising can be. Rajib Basu, Partner and Leader - Entertainment & Media, PwC India, in his spotlight session ‘survival of the fastest’ decodes the emergence of CTV in the traditional TV broadcast value chain, while shedding light on the opportunities and challenges that lie ahead.

Basu spoke about how the TV value chain is getting disrupted and what are the different elements that are coming into the broadcasting chain. He also deciphered the key differences between the frequently interchangeably used terms such as CTV, OTT and linear TV for the audience.

Shedding light on the history of smart TVs, Basu spoke about how the TV broadcast value chain has got disrupted with the proliferation of communication technology. The main reason for this disruptive development in the TV market is the convergence or melting together of different industries, e.g., internet, broadcast and telecommunications industries. 

“IP and internet is an enabler that breaks down industry barriers, as it has been the case for other technological innovations during recent years. It really is a particular segment of the audience that is moving towards this technology- a certain income bracket,” he noted, citing a 2016 survey by Nielsen in the US that reported that 29 per cent of households with incomes over $75,000 a year had a smart TV. 

The traditional TV broadcasters now also face competition from on-demand content aggregators and OTT providers, he noted. “The traditional television is today only one of the many devices from which it is possible to watch TV. These  devices, such as smartphones, tablets and game consoles, now support TV viewing via apps. The traditional TV itself has been Internet-enabled which is also called smart TVs, and they support a long range of apps for the user. “The television value chain today is much more fragmented, and this is due to the increasing applications of communication technologies,” he said.

Talking about the difference between CTV, OTT and linear TV, Basu said, “Over-the-top (OTT) and connected TV (CTV) devices are two very popular methods of accessing TV /video content, but they can be easily confused with one another.” OTT is essentially the delivery mechanism for TV /video content online, usually through streaming or video on demand (VOD), he said, while CTV is an internet-connected device a customer uses to watch TV / video content online. It could be a smart TV, gaming console, or some other sort of internet-connected device. The device may be used to stream OTT content, but the two terms are not interchangeable, he pointed out. While Linear TV refers to a classic system when a viewer watches a scheduled TV program when it airs on its original channel, he explained.

Basu also threw up an overview of CTV trends based on highlights from a recent Kantar survey: From a 12% share in 2022, CTV share is estimated to reach 22% share of total TV market in 2027 globally, he stated. According to another GroupM 2023 study, CTV Ad Spends in India is predicted to grow at a CAGR of 47%, reaching $395mn by 2027. "Advertising spends on TV would grow on the back of brands spending more on Connected TV. If convenience is driving audiences towards connected TV, addressability is driving advertisers to connected TV,” he noted. 

Sharing some more trends that were driving the growth of addressable TV households, he pointed to content on OTT apps, and growing Smart TV sales, and broadband connections as the enablers for CTV- 11% CAGR in broadband subscribers with 600 million OTT viewers with an average daily time of 180 minutes spent  by 2025, as per TRAI ( BAIN report). Citing another Kantar sample survey, he noted that Connected TV is the preferred connection at 65%, comprising smart TVs and devices such as Firestick, Internet-enabled set top boxes vs 35% linear (Cable + DTH).

Basu also spoke about the key differences between CTV & Linear TV that has a deep impact on how brands can market to CTV audiences. “Content is available on demand in case of CTV users, and can be personalized using Al type technologies. Advertising can be targeted and better profiling of the customer is possible when it comes to CTV advertising. If a consumer sees an ad on linear TV that inspires them to buy, they might search for the brand or product name on Google and navigate to the company's website from the search results. That website click will be attributed to the search engine instead of to the ad spot itself. But in the CTV realm, the click of the consumer who navigates their attention away from TV glass to visit the brand's website on their mobile device, for example, will be attributed to the CTV ad,” he asserted. 

Assessing effectiveness in CTV advertising usually means tracking metrics like cost per completed view (CPCV), cost per acquisition (CPA), average order value (AOV), etc. Thus CTV attribution gives the ability to identify where consumers are coming from when they take an intended action, whether that's a specific channel or an individual ad campaign.

In the TV space - Connected TV is fast emerging as the space due to its ability to differentiate on content, timing preference and personalization. So as the communication technology enhances - bundling of more and more personalization features will get audiences faster to a CTV than to a linear TV, though the latter still also has huge tailwinds in India, Basu asserted. 

“With viewership dropping on satellite and cable TV in the last decade, we saw the shift from traditional TV to streaming TV begin. Over the next decade, we will see this movement solidify as big data, machine learning, artificial intelligence, and IOT products continue to advance,” said Basu. Regardless of the changing landscape, there is no question that OTT and TV advertising will remain relevant, he signed off.