Behind the Numbers: TV and Streaming Trends for 2025—Netflix's Live Sports Push & Small/Mid-Sized Brands Spending More on CTV Ads

Podcast Information:

• Title: Behind the Numbers: an EMARKETER Podcast
• Host/Author: eMarketer
• Episode: TV and Streaming Trends for 2025—Netflix's Live Sports Push & Small/Mid-Sized Brands Spending More on CTV Ads
• Release Date: January 17, 2025

Introduction

In the January 17, 2025 episode of Behind the Numbers, host Marcus sits down with eMarketer’s Vice President Paul Werner and Senior Analyst Ross Benesh to explore significant trends shaping the future of TV and streaming. The discussion centers on two primary predictions: the increasing share of Connected TV (CTV) ad revenues from small and mid-sized brands, and Netflix's strategic foray into live sports broadcasting.

Trend 1: Growth of CTV Ad Revenues from Small and Mid-Sized Brands

Presenter: Ross Benesh

Signature Take

Ross Benesh predicts that the proportion of CTV advertising revenue generated by small and mid-sized businesses will see substantial growth. He emphasizes that streaming platforms like Roku, Disney, and Comcast are enabling easier access for these advertisers through self-serve options, thereby democratizing ad space previously dominated by large brands.

“You’re gonna see more youtubification of streaming.” — Ross Benesh [05:10]

How It Will Technically Play Out

Ross explains that streaming services are increasingly focusing on programmatic advertising and self-serve platforms to attract a broader range of advertisers. This shift allows smaller brands to purchase ad inventory without the need for large budgets typically required by national campaigns. However, he acknowledges challenges such as limited creative resources among smaller advertisers, which may lead to more simplistic ad creatives.

“You’re going to see some cheaper creative as more performance and more small advertisers are crowding the market.” — Ross Benesh [11:06]

He also highlights the role of AI in assisting small advertisers to produce effective ads without significant investment in creative teams.

Showstopping Argument

Ross concludes by stressing the necessity for streaming operators to diversify their revenue streams to remain profitable. With large advertisers reaching their spending limits, embracing small and mid-sized advertisers becomes essential.

“The amount of revenue they can bring in from large advertisers is going to get tapped out. So to reach their full potential, they’re going to lean more heavily on small and mid-market advertisers where there are just many more players to choose from.” — Ross Benesh [19:19]

Trend 2: Netflix's Expansion into Live Sports Broadcasting

Presenter: Paul Werner

Signature Take

Paul Werner discusses Netflix's aggressive entry into the live sports arena as a transformative move that signifies a new era in sports video licensing. He points out Netflix's recent acquisitions, including exclusive rights to stream major events like the FIFA Women's World Cups and the Mike Tyson-Jake Paul boxing event.

“Tech companies are best positioned to take advantage of that global interest and they can be a lot more nimble than traditional broadcasters.” — Paul Werner [19:42]

How It Will Technically Play Out

Paul elaborates on Netflix's strategy to experiment and solidify its presence in live sports. He references Netflix's successful experiments with various sports, including WWE wrestling, which has garnered higher viewership than traditional broadcasts. Paul anticipates that Netflix will continue to secure consistent rights for entire sports seasons and explore niche and international sports markets to capitalize on global audiences.

“They will have to pick out something that’s big because, yes, most of the major rights are locked up for 10-year contracts... But there’s a lot more that they can.” — Paul Werner [17:58]

He also notes the potential for Netflix to leverage its vast global subscriber base to introduce and popularize lesser-known sports internationally.

Showstopping Argument

Paul emphasizes Netflix's global reach and technological agility as key factors that will drive its success in sports licensing. Unlike traditional broadcasters confined to specific geographies, Netflix's worldwide presence allows it to tap into diverse markets and optimize sports content for various regions.

“Tech companies are best positioned to take advantage of that global interest and they can be a lot more nimble than traditional broadcasters. So I think that's part of what's fueled the tech boom in sports licensing and it's just going to continue with Netflix as now a major player.” — Paul Werner [19:42]

Round Two: Technical Manifestation of Trends

Ross on CTV Ad Growth

Ross envisions streaming services enhancing their self-serve and programmatic advertising platforms to attract small and mid-sized advertisers. He anticipates a rise in AI-driven ad creation tools that lower the barrier for these businesses to produce competitive ads without hefty budgets.

Paul on Netflix’s Sports Expansion

Paul projects that Netflix will transition from experimental live sports broadcasts to consistent seasonal rights acquisitions. He predicts that beyond mainstream sports like UFC and WWE, Netflix will explore international and niche sports to expand its global footprint and diversify its sports portfolio.

Competition Outcome

After presenting their arguments, Marcus awards the episode’s "Taker Baker" crown to Paul Werner. The decision highlights the compelling nature of Netflix's strategic moves into live sports and its potential to reshape sports broadcasting on a global scale.

“A big world out there and tech companies are best positioned to take advantage of that global interest and they can be a lot more nimble than traditional broadcasters.” — Paul Werner [19:42]

Conclusion

The episode concludes with Marcus acknowledging the close competition between Ross's and Paul's insightful predictions. He underscores the significance of both trends: the democratization of CTV advertising empowering smaller brands, and Netflix's bold steps into live sports cementing its role as a formidable player in sports media licensing.

“Live sports offer ample downtime before and during games, making a well-suited fit for ad breaks a lucrative source of revenue.” — Narrator [20:00]

Listeners are encouraged to tune in for future episodes as eMarketer continues to dissect and predict the evolving landscape of digital media.

Notable Quotes:

• Ross Benesh [05:10]: “You’re gonna see more youtubification of streaming.”
• Paul Werner [19:42]: “Tech companies are best positioned to take advantage of that global interest and they can be a lot more nimble than traditional broadcasters.”
• Ross Benesh [19:19]: “The amount of revenue they can bring in from large advertisers is going to get tapped out. So to reach their full potential, they’re going to lean more heavily on small and mid-market advertisers where there are just many more players to choose from.”

Final Thoughts

This episode of Behind the Numbers provides a comprehensive analysis of pivotal trends set to influence TV and streaming in 2025. By examining the shifting dynamics of CTV ad revenues and Netflix's strategic entry into live sports, listeners gain valuable insights into the future directions of digital media and advertising.