Key Points
- A new report from TVREV finds the “streaming wars” are shifting from apps to connected TV platforms that control content discovery and monetization.
- Smart TV operating systems from companies like Samsung, LG Electronics and Roku are becoming central hubs for advertising, data and subscriptions.
- Global competition is intensifying, with platforms like V (formerly VIDAA) and TiVo challenging dominant U.S. players by focusing on international markets.
As the competition in the streaming marketplace intensifies, the battle for attention and consumer dollars has shifted from streaming apps and services to connected TV (CTV) platforms, who are waging the latest fight in the ongoing, so-called “streaming wars.”
That was the overall thesis of a new report published by TVREV this week that examines the ongoing fight between CTV operating systems to draw streamers to their platforms and capitalize on that attention via advertising, subscriptions and promotional placements.
Experts in the industry have long contended that the CTV platforms that dominate the most living rooms will the ones that exert the greatest control over what apps and content the biggest number of people are likely to watch. CTV developers have leaned into their roles by evolving their operating systems from simple points of navigation across content and services to robust platforms that collect valuable viewership data and manage growing pools of highly-sought advertising inventory.
The rise of free ad-supported streaming television (FAST) has accelerated the strategic importance of operating system, the report contends: FAST services are increasingly integrated directly into TV interfaces, giving platform owners greater control over audience discovery and monetization opportunities. Home screens have also become premium advertising real estate as viewers spend more time browsing before selecting content
Traditional television manufacturers like Samsung, LG, Hisense and Walmart’s Vizio have developed proprietary platforms that extend their business models beyond hardware sales. Samsung’s Tizen OS and LG’s webOS are positioned as foundations for broader advertising, content and data businesses, while Hisense is expanding its V (formerly VIDAA) platform internationally, the report notes.
Walmart’s acquisition of Vizio highlights the growing value of TV operating systems as media and commerce assets rather than hardware businesses alone. The purchase was largely predicated on Walmart seeking greater opportunities to broaden its marketing business, largely relegated to retail advertising, by expanding it to CTV through a platform it wholly controls. (The company continues to sell Android-powered streaming devices under the Onn brand, which mainly compete with low-cost streamers from Amazon, but has also brought its Vizio OS to Onn-powered smart TVs.)
Technology companies are also significant soldiers in the battle: Google, Amazon and Roku continues to leverage their software ecosystem and advertising capabilities to grow their overall business — Roku’s platform business, which includes ad and subscription sales, brought in ten times more revenue compared to hardware sales during the first quarter of the year — while Apple is holding firm on its strategy of selling premium streaming devices that tie into its broader ecosystem of phones, tablets and computers.
While Google, Roku and Amazon have control of the living room in the U.S., the companies are starting to face competition from upstarts in the domestic market, including Xumo, TiVo and the forthcoming Ventura operating system. Overseas, competition is even tougher, with Whale TV, Titan and V selling streaming-enabled smart TVs that run on their own proprietary operating systems, tapping into foreign market opportunities that the larger three players ceded for years.
Looking ahead, TVREV expects operating systems to expand beyond content discovery and advertising into payments, shopping, gaming and smart-home functionality. Artificial intelligence is expected to play a growing role in recommendations and personalization, while advertisers seek more sophisticated targeting and measurement capabilities.
Guy Edri, the CEO of V, said his company was originally built to support parent company Hisense and its ambitious international TV business, but eventually evolved into an operating system of its own that made it easy for streamers in underserved markets to access video apps, manage subscriptions and look for new things to watch via a single platform.
V also unlocked new advertising opportunities for marketers in countries where its smart TVs were available — mainly Europe, Asia-Pacific, North Africa and Latin America, though TVs are now sold at some retailers in the United States. Research from Omdia showed V’s early strategy of shipping smart TVs and nurturing the streaming and advertising market in underserved parts of the world is paying off: The company’s V platform is expected to overtake LG’s market share in Europe in the near future.
“Europe matters here because it is not the U.S. market with different accents and better bread,” the report said, citing remarks from Edri. “Broadcasters are stronger, operators still matter, local content preferences vary wildly from country to country, privacy regulation is more intense and the ad market does not always behave the way U.S. executives expect it to.”
In other words, there is no one-size-fits-all approach to CTV. Just because something works in the U.S. — which is widely considered to be the most-mature market for streaming — doesn’t mean it will work in Europe, where broadcasters and content distributors are quickly catching up.
For one, consumer trends are different. While streaming platforms have overtaken broadcast and cable TV as the preferred way to watch entertainment in the U.S., TV audiences in Europe still watch a mixture of free-to-air TV channels and pay TV networks delivered over cable and satellite. Some streaming platforms also carry live feeds of public service broadcasters like the BBC in the United Kingdom and Das Erste in Germany.
Advertising trends are also different, and knowing how companies buy advertising inventory and launch campaigns in specific markets is a benefit to tech companies that concentrate their efforts on that space, rather than try to replicate what works stateside.
V is also willing to work with its peers, rather than compete against them: In Europe, the company has forged a partnership with The Trade Desk to support the advertising business of Ventura OS. While V’s overall efforts are still “underappreciated by many U.S. executives,” certain strategies are becoming harder to ignore: Stateside, Roku forged an advertising-driven partnership with Amazon last year that is meant to bolster the ad businesses of both platforms while strengthening their competitive positions against traditional broadcasters. The partnership has trace elements of V’s arrangement with The Trade Desk (though, to be fair, the Roku-Amazon pact was announced several months before The Trade Desk announced its partnership with V.)
And the company wants to work with broadcasters to explore ways to deliver their content over streaming as more viewers in Europe and other regions gravitate toward those platforms.
“The broadcasters should come to us and we can put them front and center in a way that works for the consumer,” Edri said in an interview published in the report. “I want users to have the best experience. I am not against broadcasters. I am here to support them, but they need to wake up: If they cannot listen and change, that will be their problem. We will survive because we are the first screen.”
That screen is a powerful value proposition for V, which is building out its own data-driven business in addition to its CTV and advertising products. Later this year, the company will launch V Index, which aggregate viewership data from its smart TV devices in a privacy-minded way. As described, the effort is similar to Vizio’s data business, which also collected and sold viewership data to third parties. The Desk was the first to report on V Index in February.
Those differentiated strategies are intended to help V and others super-serve streaming audiences in different markets and grow their platforms into robust, revenue-generating businesses. The long-term winners of the streaming wars will be the companies that balance consumer experience with monetization, TVREV concluded.
The full report is available to download for free after registration at this link. Ventura TV OS, V and Wunderkind Ads sponsored the report.
The report’s author, Alan Wolk, will produce a one-day conference called the TVREV Summit at the StreamTV Show in Denver. The TVREV Summit takes place on Tuesday, June 16 and features fireside conversations and panel discussions industry executives and thought leaders, including Edri, Ventura TV’s Ed Lee and officials from Google, YouTube, LG Ads, Spectrum Reach, Wurl and other companies.
The Desk is an editorial partner of this year’s StreamTV Show, which runs from June 16 to June 19. Readers can save 10 percent off a conference pass by using the code DESK10 at this registration page.
More Stories
- DIRECTV Chief Marketing Officer Vince Torres to receive inaugural StreamTV Trailblazer Award
- Samsung: Free streaming apps achieving similar reach as broadcast TV
- VIDAA TV OS ready to compete against Roku, Amazon in U.S.
- The Trade Desk partners with VIDAA, Nexxen on CTV-focused Ventura Ecosystem
- VIDAA takes on Nielsen, Comscore with V Index measurement solution
- Parks: Roku, Samsung are dominate connected TV platforms in U.S. homes
- Parks Associates: Streamers want aggregated TV experience in single platform
