Connected TV has grown to the point where there are 55 million U.S. households that only watch CTV, according to a new study from Magnite.

Those 55 million households mean that 40% of U.S. TV homes are reachable exclusively via CTV and not over the air or via traditional pay TV. 

Los Angeles-based ad technology firm Magnite also found that CTV reaches a more balanced mix of age groups, compared to pay TV, which skews toward viewers 55 years old and up. CTV also delivers an audience as diverse as the country overall, while pay TV is overly white and underrepresents Black, Latin and Asian consumers.

Viewers don’t seem to be adopting CTV to avoid commercials. The study found that 90% of CTV viewers watch ad supported programming, with 47% of the content they see being ad-supported, compared to 53% ad free.

CTV viewers said they were twice as likely to buy a product after seeing an ad they paid attention to and 47% of CTV viewers said they were willing to share the information they find in relevant ads.

Video on social media platforms is a less-effective means of reaching consumers who also watch CTV. Only 21% of CTV users reported that they are likely to pay attention to a video ad on social media.

“CTV is now much more than just an audience extension tool or an add-on to a linear buy, because it’s clear that a large portion of TV viewers have shifted their attention in favor of CTV,” Magnite chief revenue officer, CTV, Sean Buckley said. “While traditional TV audiences have become more homogeneous, CTV viewers encompass a representative cohort of ages and backgrounds. Our goal in conducting this research is to help media owners and advertisers understand how they can use CTV to reach CTV viewers effectively, authentically and respectfully.”

DVR usage climbed in 2016, but live viewing continues to dominate the way consumers watch TV, Altice USA concluded in new report that analyzes data from millions of set-top boxes across the operator’s Optimum (former Cablevision Systems) footprint.

Per the operator’s Data Flash Review, live TV in the Optimum footprint “held steady”  in 2016 versus 2015, representing 91.9% of overall viewing, compared with DVR “engagement” (4.9%) and VOD (2.7%). Of those categories, DVR viewing rose 9% year-on-year, with an average of 1 hour and 47 minutes per day, and representing the most popular time-shifted or on-demand viewing method.

Among other findings of the report, Optimum homes averaged eight hours of tuning per day in 2015 and 2016. News programming tune-in rose 4%, with a surge of 99% for political-focused programs thanks to the election season, and sports programming tune-in dipped 4%. The full infographic illustrating the study findings can be found here.

The report’s Optimum TV household viewing trends are based on an analysis of anonymous, census-level viewing data of 2.6 million active tuning households in the New York tri-state area. This report did not factor in tune-in analysis of Suddenlink homes. Altice acquired Suddenlink in December 2015, and closed its deal for Cablevision last June. 

“Optimum customers love watching television and live tune-in continues to be the most popular way they choose to access their favorite content,” Paul Haddad, Altice’s global chief data officer, said in a statement. “We have also seen customers take advantage of options to watch programming on their own terms, with viewing up substantially on our DVR platform. With deep insights into the viewing trends of our Optimum customers, Altice USA is able to constantly innovate and prioritize new features and services that align with consumers’ preferences and demands.”

Say goodbye to the American couch potato. No longer are TV viewers content to just sit on the couch, flip through channels until they find something semi-entertaining. Today, they don't think twice about fast-forwarding through irrelevant ads or cutting the cord on cable packages. They expect seamless, on-demand and more personalized viewing across whatever screen they want to watch their favorite content.

The recent shifts in TV-viewing habits are nothing short of revolutionary. Aided by a wave of new Internet-based technologies, the medium has been transformed into something viewers take an active part in shaping.

From media companies to advertisers, everyone has to adapt to this radically changing environment. We must come to terms with the fact that traditional one-way television has experienced the same fate as black-and-white sets and rabbit-ear antennas.

Television Comes Back to the Living Room? 

 The consequences of this sea change have been dramatic. The pace of cable and satellite subscription cancellations – so-called "cord cutting" – has accelerated, up 12 percent this year. Cord-cutters have given way to a separate group known as "cord-nevers" – the quarter of millennials who never signed up for cable in the first place, and likely never will.

However, this doesn’t mean that TV sets are going dark. For the first time ever, the majority of U.S. households have at least one TV connected to the Internet. That's 6 million more homes than just a year ago. And consumers are also starting to prefer TV-connected devices like Apple TV, Roku and gaming consoles in lieu of traditional cable. According to Adobe Digital Insights data, these devices have seen 143% sales growth since last year. When we consider all the ways in which consumers now access TV content, overall use has risen 2.6% for average household viewing. 

When the term “TV Everywhere” was first coined, the industry anticipated that mobile devices would become a dominant means for viewers to enjoy TV content; the numbers indicate this is no longer happening. Consumers have brought TV back into their living rooms, albeit in a completely different form.  

Ad Dollar Tug-of-War

When it comes to monetization, the industry is at a juncture point. As audiences become more transient across linear and digital screens, the ad dollars have not caught up to a multiscreen environment. As much as this poses a challenge, this story is one about opportunity. With TV content being unleashed across digital channels, a flood of new data becomes available. Like with the best mobile apps or desktop websites, data is the key to building audience intelligence and serving experiences that are more relevant and personalized. Advertisers would be able to drive higher ROI and media sellers can charge more for specific audience profiles. And, this data is also beginning to be used to make linear television more relevant and personalized too.

With audiences increasingly ignoring ads that are irrelevant to them, this becomes more critical than ever before. If a beauty retailer wants to target female millennials, they must go beyond blanketing an ad based off the characteristics of a particular show and engage a specific segment of viewers that can actually act on the ad. It’s also important that female fans aren’t getting hit with the same ad on every device they use multiple times throughout the day.  Managing a cross-device audience is paramount in today’s multi-screen advertising execution.

TV advertising is going through one of the biggest shifts the industry has ever seen. With data as the foundation, we can get to a place where consumers receive more personalized content, while advertisers and media sellers can better engage viewers with higher ROI.  

Getting Personal

Simply getting content to viewers where and when they want it – once the central challenge – is no longer enough; consumers now expect experiences that are tailored specifically to them. As we look ahead, the ability to refine content discovery and recommendations with either hinder or propel audience engagement. With an increasing number of content options, this is even more important.

Data has another big role here, as media companies must gather data from various channels to build an understanding of individual viewers – at scale. Emerging technologies such as machine learning and data science will become more critical, as a means to differentiate when competition heats up.

Imagine being served a TV show based off everything from how quickly you abandoned other shows to your most-watched genres. Or, visualize an interface that not only displays your favorite channels but also pulls from a Facebook feed to learn what your friends are buzzing about.

TV will always have a central place in American life, but viewers will no longer be the unwitting subjects of a one-way experience; they will be driving that experience. Media companies face a choice: either empower viewers to watch what they want and deliver highly engaging experiences, or get left behind.

-Jeremy Helfand is Vice President, Primetime at Adobe