Even When the TV Is Off, Streaming Ads Continue?..."US Advertisers Lose 1.3 Trillion Won Annually"

[Image source=AP Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] As streaming companies like Netflix plan to expand their advertising revenue, concerns have been raised that advertisements attached to streaming content often continue to play even after viewers stop watching the streaming service on their TV. Analysts estimate that advertisers are losing more than $1 billion (approximately 1.3 trillion KRW) annually due to this issue.

On the 12th (local time), The Wall Street Journal (WSJ) cited research from WPP PLC, the world's largest advertising agency, reporting that 17% of ads played on TVs connected to streaming devices?including streaming boxes, dongles, sticks, and game consoles?continue to play even after the TV is turned off. Overall, about 8-10% of ads delivered through streaming services, including streaming devices, are played even when the TV is off.

This phenomenon is analyzed to occur because when the TV device is turned off, signals may not be transmitted to streaming devices connected via HDMI ports. If viewers do not close the streaming application (app) or stop playback before turning off the TV, the app remains in a state capable of playing video and continues to run ads even though the TV is off.

WSJ reported that this results in losses for advertisers. Recently, advertisers in the United States have been shifting their advertising channels from traditional TV to streaming platforms. According to Insider Intelligence, the connected TV advertising market in the U.S. is expected to grow from $2.6 billion in 2017 to $18.9 billion this year. Based on this estimate, WSJ stated that the cost of ads played after the TV is turned off, which viewers do not watch, could amount to approximately $1.5 billion to $1.9 billion this year alone.

Colqu McDonald, CEO of GroupM, the investment group of WPP PLC responsible for North America, said, "The explosive growth of streaming presents abundant opportunities," adding, "However, with technological changes, it is our job to clarify all advertising delivery methods and reduce the gaps."

This content was produced with the assistance of AI translation services.