Industry insights: The volume of content and the role of AI in creating it was on the agenda at Series Mania, while sports may be key to streaming war success, and CTV ad spend is on the rise.
Key conversations from Series Mania
The recent Series Mania festival held in Lille, France, managed to provide a rich seam of news stories. Max’s European rollout to 20 countries was confirmed there, and Variety magazine has a good summary of the key takeaways from what is becoming an increasingly influential festival.
Apart from a welcome groundswell of optimism surrounding the European industry, two stories caught our eye.
The first was a quote from European Commission official Lucia Recalde.
“We have estimated the amount of time that it would take you to watch all the content that is available today on streaming platforms,” she said, quoted in Deadline. “350 years, and I’m not counting user-generated content, I’m not counting video games – I’m not counting all forms of entertainment. That’s the level of competition that all the media companies are facing today in the cellphone attention economy.”
This highlights the importance of efficient content recommendation systems in preventing viewers getting swamped with content and therefore paralyzed by choice. Viewer fatigue is a very real issue with SVOD services in particular, and the very latest technologies now harness AI to surface recommendations to the right viewers at the right times from deep libraries, maximizing value and reducing churn.
And talking of AI, research directors from Omdia and Plum Research presented findings that industry AI spending is likely to rise above $13bn by the end of 2028. This will be spread fairly evenly across analytics, development/delivery, and customer experiences such as personalization and discovery.
Thankfully, as Variety reports, the analysts do not anticipate the content creation apocalypse that has dominated much of the recent coverage of AI.
“AI will not replace humans,” said Omdia’s Maria Rua Aguete, echoing a common refrain. “But humans that know how to use AI will replace those who don’t because they will be more efficient, more creative, and [better] prepared.”
As an example, the analyst pointed to OpenAI’s Sora, which they say has enough concerns regarding the reliability of its output that it is more suited to short-form advertising, web clips, and making test videos than for mainstream film and television production. Likewise, they see AI making a greater contribution as an assistive tool to production and post-production, working on storyboards and pre-visualization, improving color correction, and so on.
“In terms of business, AI is going to be really useful for making the inaccessible accessible and for solving problems we’re having with talent [shortages],” said Plum Research’s Jonathan Broughton. “The main challenge right now is on the management side. It’s up to business leaders to understand how to deploy this within their organizations and to create processes within existing workflows.”
How sports may settle the streaming wars
We’ve written before about the rise in sports streaming and the necessity for sports streaming tools to provide reliable high quality, low latency to engage fans. In its latest survey, What’s the Score: The Evolution of Sports Media, Hub Entertainment Research confirms that access to sports content strongly influences a viewers’ choice of platform.
The report has several key findings:
- During the season, 80% of fans say that their favorite sport is more important than anything else they watch on TV
- 75% of ‘avid fans’ said they would be likely to sign up for a new streaming subscription if they needed it to watch a sport they follow
- 31% often watch shows they see promoted during a game or other sports content
- 27% often stay on the same channel to watch the show that comes on next
“These findings reinforce that sports content will have a big impact on the next stage of the streaming wars, and might entirely settle them,” said Jon Giegengack, principal at Hub. “There are lots of sports fans, and they care more about the sports they follow than anything else on TV. As expensive as rights have become, they may turn out to be the best investment: hours and hours of unique content which comes with a built-in audience that tunes in every season without fail.”
US CTV ad spend to surpass $21bn in 2024
One of the latest forecasts looking at the US ad industry estimates that Connected TV advertising (i.e. targeted TV advertising) is on track for significant growth in 2024. Research company Advertiser Perceptions reckons that it will grow over 16% this year, boosted by the twin engines of the Olympics and the US Presidential elections.
That’s going to lead to a total spend of $21.45bn for 2024. Growth will then slow in 2025, but only to a still respectable figure of just over 13%, bringing in $24.43bn to the industry.
These are large numbers, even more so when you realize that Advertiser Perceptions reckon they are on the conservative side, too. There are some interesting caveats, though.
- Most ad spend will stay within local TV channels as political parties look to get the vote out
- The effect of the arrival of ads on Amazon Prime Video remains an unknown quantity
- Competition is less between streamers than between streamers and social media platforms
Short form video in particular is a target for advertisers, with platforms such as TikTok, Instagram (Reels), and YouTube (Shorts) leading the way. Indeed, and to give some context to the CTV figures, this alone is expected to bring in $28.72bn in 2025.
Retail media, which includes on-site search on retail websites and apps and on-site display (typically placed on retail websites and apps) is a significant growth area too. Retail media ad spend could surpass $81.6 billion in 2024, representing 23.5% of all digital advertising in the US, and looks set to become a significant partner to CTV.
“Retail media has opportunities in the CTV space and vice versa, where advertisers can marry retail and viewing data for targeting, along with measurement and the potential for closed-loop attribution with the advent of new formats like shoppable ads,” writes Stream TV Insider.
Interested in implementing targeted TV advertising? Or sports streaming? Or want to use AI to manage content recommendations? Then come and meet with us at NAB…
