£115m of UK advertising was viewed on a TV connected to the internet via streaming devices, smart TVs, games consoles and set-top boxes in 2016, meaning the UK has the largest connected TV ad market in Europe.

According to research from video ad platform SpotX, conducted by London-based research and strategy consulting firm MTM, connected TV advertising is expected to grow to £220m in 2020, thanks to the growing over-the-top (OTT) advertising landscape across the globe.

“The UK is Europe’s largest ad market, both in terms of TV ad spend and internet advertising spend,” said Leon Siotis, managing director for the UK and Southern Europe at SpotX. “We see increasing demand from advertisers seeking advertising in a big screen environment served and measured using digital techniques, with some agencies creating new business units to focus on the opportunity.  Media owners and broadcasters such as ITV, STV and TVPlayer are generating additional revenue streams this way, addressing agency requirements to target viewers of premium programmes at scale. 

“We have seen significant growth across Europe and expect this to grow rapidly over the next few years as more agencies and advertisers benefit from advertising on connected TVs, as part of the growing OTT landscape.”

The research found, through interviews with leading broadcasters and industry experts, that 75 per cent of UK households are predicted to connect their TVs to the internet by 2020. In addition, 91 per cent of households have fixed broadband connections – with 91 per cent of those offering speeds of over four mbps, which is more than capable of watching TV over the internet.

“The UK is the most mature market in Europe for connected TV advertising,” said Nick Thomas, associate director at MTM. “Over the past ten years, services such as the BBC’s iPlayer have driven consumer awareness and adoption of on-demand video services and broadband penetration and speeds are high delivering high-quality viewing experience in most homes.  Commercial broadcasters have responded with a wide range of well-designed OTT apps creating a robust streaming ecosystem for live and on-demand streamed television that continues to grow.”