Following a banner year, US ad spending in 2022 will be shaped by three key trends: Linear TV crossing the Rubicon, a billionaires’ club emerging in connected TV (CTV), and ecommerce ad spending enriching Google, Amazon, and a crop of newcomers in search and retail media.

Only about a quarter of US agency and marketing professionals expected to increase ad spending on traditional TV as of October 2021, according to an Advertiser Perceptions survey. This compares with 40% for over-the-top (OTT) streaming services.

While traditional TV ad spending will struggle for growth in the coming years, digital video will not. A portion of digital video spend will go to the nascent CTV space, but traditional broadcasters are also developing their own streaming services (with BVOD ad spend rising at a far faster rate than traditional TV spend). Overall, the advertising opportunity for CTV remains small.

US linear TV ad spending will hit $68.35 billion this year and fall to $64.94 billion in 2026. Despite that decline, ad spending on linear and connected TV (CTV) combined will increase from $87.24 billion this year to more than $100 billion in 2026 due to the surge in CTV viewing.

This year, 57% of US video ad spending will go to linear TV, a decline from 62% in 2021 and 71% in 2020. By comparison, ad spend share is increasing for connected TV (CTV) and other digital formats such as social video.

Several forces are driving up costs per thousand on both linear and connected TV. On the linear side, audience levels have dropped at a faster rate than ad spending, so more dollars are chasing fewer viewers.

Our upfront CTV video ad spending forecast is similar to our upfront digital video estimate in that it includes ad spending committed in advance from the TV upfronts and IAB NewFronts. Our upfront CTV estimate is a subset of our upfront digital video estimate.

On today's episode, we discuss whether Disney+ is back on track, how to read HBO Max's numbers, and whether Paramount+ can keep up. For "In Other News," we talk about why folks are cutting the cord today and why there's been a boost in ad-supported video-on-demand (AVOD) ad spending. Tune in to the discussion with our analyst Ross Benes.

Although a growing percentage of ad spending around TV content is happening through addressable, programmatic, and connected TV channels, making advertising more accountable, holistic campaign metrics that cut across the linear and digital domains remain elusive.