Local programmatic ad spending to reach $37.6B by 2021, BIA/Kelsey says

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A major driver for more targeted ads on the local TV level is the upcoming ATSC 3.0 standards for broadcast TV, according to BIA/Kelsey's report.

Spending on targeted ads in local video will grow by $5 billion to $37.6 billion in 2021, according to a new forecast from BIA/Kelsey.

The firm predicted that most of this growth will come from digital video and local TV, and that digital growth could be tempered as programmatic becomes more of a reality in broadcast and MVPD video platforms, with a portion of the forecasted video spend being directed to linear video platforms.

“The innovation being displayed in local TV and programmatic is becoming more widespread,” said Rick Ducey, managing director of BIA/Kelsey, in a statement. “Our latest research reveals the landscape of programmatic players is growing more complex as companies offer more cross-platform and cross-functional solutions. These developments are being supported by new alliances and partnerships, mergers and acquisitions, and sophisticated product roadmaps.  When you step back and examine the possibilities, any movement of local TV toward programmatic buying and selling will significantly impact the amount of spending and could win more spending that might have gone to digital.”

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A major driver for more targeted ads on the local TV level is the upcoming ATSC 3.0 standards for broadcast TV, according to the report.

That amount of targeting for programmatic ads has been a big selling point in the run up to the ATSC 3.0 standards’ scheduled finalization in April 2017.

Sinclair and One Media are eyeing multiple ways of monetizing the data captured by ATSC 3.0 Next Gen-enabled devices. The companies said that advertisers will get greater efficiency in spending with addressability and personalization, and broadcasters will get greater efficiency in reaching and capitalizing on a larger advertising market.

"This is about knowing the truth regarding who is watching, what they're watching and when they're watching," said David Smith, chairman of Sinclair, in a statement. "Data gathering, measurement and behavior is too important for us not to have a reliable system and there is an immediacy to have this in place to coincide with the rollout of ATSC 3.0. Sinclair and One Media 3.0 intend to build it and make it available to the industry. We are currently working with device manufacturers and will shortly identify a test market in which to conduct live field trials."