Streaming ad growth is slowing as linear TV keeps most U.S. ad viewing. Digital ad platforms face shrinking opportunities while walled gardens dominate connected TV. Analysts see no quick shift ahead.
Independent digital ad buying platforms aiming to expand in the connected TV (CTV) market are facing a major obstacle: linear TV’s continued dominance in U.S. ad viewing. Nielsen’s Gauge reports that about half of all TV viewing in the country still comes from cable, broadcast, or satellite. More strikingly, over 80% of TV ad viewing time remains with linear channels, as much streaming happens on ad-free or ad-light services. Analysts do not expect streaming to account for even 75% of ad viewing time until well into the 2030s, leaving digital ad platforms with limited room for rapid growth.
These platforms are caught between two powerful forces. On one side, Amazon Prime and Google/YouTube’s fast-growing video ad businesses are capturing much of the real CTV ad expansion, and neither relies on independent platforms for distribution. On the other, nearly $50 billion in U.S. premium video ad spend is still controlled by linear TV companies, which do not allow digital ad platforms to participate. These platforms lack the tools for data-driven linear targeting, measurement, and automated buying, making it impossible to access this significant revenue stream.
While streaming ad budgets are expected to rise and linear TV ad spend to decline, the pace of change is slow. The competitive gap for digital ad platforms is narrowing quickly, with price pressure from Amazon and Google intensifying. Walmart is also moving into TV video, and social video competition is increasing. As a result, platforms like The Trade Desk are losing the “green field” growth opportunities they once enjoyed. Programmatic banner ad volumes and margins are shrinking, and most premium CTV inventory is tightly controlled by a few major players. Buyers increasingly prefer guaranteed deals based on content, not audience, reducing the need for complex bidding and data exchange platforms.
All major digital players are now competing for a limited pool of streaming ad growth, and there is not enough to satisfy everyone. If linear TV distribution were to collapse suddenly, the situation would change dramatically. Until then, digital ad platforms not operating as walled gardens must find ways to directly access and manage linear TV ad inventory and transactions. Without this, most will struggle to achieve the growth rates expected by public investors for at least the next seven to ten years, until linear TV ad channels lose their relevance.
This frustration is not unique to digital ad platforms. The resilience of linear TV is also affecting other segments of the advertising market. For example, as reported in a recent analysis of digital out-of-home ad spending, brands are seeking new channels for growth as traditional formats remain strong. Cinema attendance and major events are fueling a rebound in digital out-of-home ad spending, highlighting how established channels can still command significant advertiser attention.
