OTTs are no longer only paid services like Netflix. More and more services are entering the scene, delivering free ad-only video content to Smart TVs.
Over-the-top (OTT) is the term used to describe the distribution of films, series or live TV content over the internet, without having to pay for cable or satellite TV, for example.
This trend has been growing rapidly in recent years and the number of paying OTT clients is growing at a meteoric pace. Netflix, the strongest player in OTT, currently has over 130 million paying clients worldwide.
OTT is very interesting for advertisers as an alternative or complement to classic TV.
In recent years, the growth of OTT advertising has been hampered mainly by the fact that most OTT services are paid and 100% ad-free (Netflix, Amazon Prime, Hulu, etc.). Recently, however, services have emerged offering content for free and funding their operation partly or entirely through advertising (Crackle or Sling). This has enabled growth, which is projected at 40% for this year - $2 billion in absolute terms (Magna data).
While this is still a fraction compared to traditional TV ($63 billion), the ratio will continue to change in favour of OTT. For advertisers, this has many advantages - particularly the possibility of precise tailored targeting.