Over-The-Top’s popularity is rapidly increasing with both consumers and advertisers.

Here’s everything you need to know.

THE OTT REALITY CHECK

Over the Top (OTT) is audio and video content that is distributed over the Internet without a traditional TV provider.

OTT IS NOWMAINSTREAMConsumers regularly watch video through OTT, whether streaming video across devices or accessing their Connected TVs.

42%of people prefer to

watch TV shows online

Source: AOL Mega-Audience II, Fall 2015

OTT VIEWING HAPPENING ACROSS SCREENS + OFTEN

Devices used to watch OTT by OTT Users Access OTT once a week or more

65%

59%

41%

35%

13%

89%

88%

83%

85%

83%

Laptop

Smartphone

Tablet

Connected TV

Gaming Console

Source: AOL and Advertiser Perceptions Monthly Omnibus Study, February 2016

BUT PAY TVISN’T DEAD...

YET11%have discontinued paid TV service to watch TV over

internet exclusively

13%say they are likely to discontinue paid TV

service to watch TV over internet exclusively over

the next 6 monthsForrester, 2016

Source: Forrester, North American Consumer Technographics Online Benchmark Survey (Part 2), 2015

ADVERTISERS ARE ADAPTING

2Xas many advertisers are planning to spend on OTT in 2016 from 2015. The amount they spend also increases each year

Source: AOL "2015 State of the Video Industry,” October 2015

Digital advertising budget allocated to OTT/Connected

TV

18%17%

16%

201620152014

PROS + CONSAs an emerging medium, advertising on OTT comes with both benefits and challenges.

Here are key points we heard from advertisers.

TOP 5 BENEFITS

42%

41%

32%

31%

23%

Reaching incremental audiences (i.e. cord cutters)

Extending the brand story across screens

No ability to skip ads

Catching up to consumer consumption trends / gaining relevancy

Gaining more consumer-level data

TOP 5 CHALLENGES

35%

30%

29%

28%

28%

Lack of measurement

Small scaleaudience penetration

Lack of standardization

Price

Lack of targeting capabilities

Source: AOL and Advertiser Perceptions Monthly Omnibus Study, October 2015

THE FUTURE IS CONVERGENCEAs the space evolves, advertisers see consolidation across channels on the horizon.

53%of advertisers agree that TV,

online video, and OTT should be combined into one overall video budget

Source: AOL and Advertiser Perceptions Monthly Omnibus Study, October 2015