Inside Roku’s battle to control the future of TV advertising — and why it better watch out for Amazon

The exploding userbase for OTT/Connected-TV is driving a projected 93% increase in Roku’s advertising revenue to $293M this year.

Flashback: How TV Buyers Can Capture the Value of Digital Video

Connected TV users by year (% growth):
1) 2017–168.1M (↑ 10%)
2) 2018–181.5M (↑ 8%)
3) 2019–188.1M (↑ 4%)
4) 2020–191.6M (↑ 2%)
5) 2021–194.4M (↑ 2%)

What is driving this growth in revenue? Roku is off to an early lead in OTT advertising with 83% of the ads delivered in April.

Share of OTT ads delivered in April:
1) Roku — 83%
2) Other — 11%
3) Amazon Fire — 4%
4) Sony Playstation — 2%

More #1: Murdoch: Ad-Supported And Ad-Free Hulu Options ‘Empower The Customer’

Hulu subscriber base:
1) $7.99 with advertising — 40%
2) $11.99 without advertising — 60%

Quick math:
1) $4/month to remove commercials
2) 9 minutes of commercials per hour
3) 18 30s spots per hour
4) Assuming $50 CPM
5) $0.90/hour in ad revenue generated per user
6) At $4/month for no ads, Hulu makes more $ from anyone who watches less than 4.4 hours per month.

More #2: Connected TV: A Hero Is Rising

More #3: Streaming Sticker Shock