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Advertising on Streaming Services Proves the Commercial Still Reigns

February 13th, 2019   ||    by Callie Wheeler

Advertising on streaming services indicates that though things change, they also stay the same. What was once considered the key to the future—a utopia of uninterrupted viewing—has been increasingly mirroring its traditional counterpart, from original programming to commercial breaks.

Streaming’s Evolution

The precursor to streaming’s appeal, in many ways, was digital video recording (DVR) devices like TiVo, giving viewers the freedom to view television whenever they wanted. With that power came the freedom to fast-forward through commercials, too.

As viewers acclimated to this newfound means of watching their favorite shows, it was only natural that advertising on streaming services was more limited than on traditional broadcast and cable television, or in paid cases, eliminated altogether. But in the years since, viewers are starting to see small shifts that demonstrate the importance of advertising, regardless of platform.

Commercials on Paid Subscriptions

Paid streaming services have traditionally implied a universal truth: no ads. But there are growing exceptions to the rule, and they vary in scope.

Netflix has limited its “commercials” to promos for its own original programming. As IndieWire reported, the company is testing showing ads for original shows between episodes, though it doesn’t currently affect all subscribers.

Hulu, on the other hand, takes things a step further. The streaming service has several shows that are exempt from its Hulu No Commercials plan, meaning that every viewer will see at least an ad before and after the episode.

Advertising on OTT Devices

A bridge to even greater advertising potential are OTT devices, which offer brands the opportunity to advertise to viewers who may be consuming content from Netflix, Amazon, and other streaming services. Roku began offering its data to advertisers this year, paving the way for targeted advertising.

Why Advertising Matters

So what does this mean for advertisers? Even as the television industry changes and innovates, there are certain elements that remain the same, and for good reason. Viewers paid for cable and satellite for years while still seeing commercials, and it only makes sense that streaming services would look for revenue in advertising.

Outside of the effort to monetize user data—which has its own challenges with data privacy and regulations—advertising is a way for viewers and consumers to access information and entertainment.

Advertisers can leverage streaming services, OTT devices, and traditional television to reach audiences where they are, when they are watching, and that won’t be changing any time soon.

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