Digital advertising firm The Trade Desk is reportedly developing a TV operating system (OS) to compete with established giants like Roku, Amazon’s Fire TV, and Google. According to a report by Lowpass, the development of this operating system began during the COVID-19 pandemic, with the company keeping the project under wraps by concealing employee roles on LinkedIn and other platforms.
The Trade Desk’s strategy focuses on offering better revenue opportunities for smart TV manufacturers compared to the existing deals provided by Roku and Amazon. The company has reportedly been in talks with various TV manufacturers and is said to have signed up at least one partner thus far, with a first device running the OS potentially launching as early as next year. The backbone of The Trade Desk’s TV OS is Android, which also powers Amazon’s Fire TV, ensuring compatibility with most streaming apps, including Netflix, Prime Video, and Disney+.
The Trade Desk’s entry into the OS market is seen as a strategic move to expand its Connected TV advertising market share. CTV advertising is a significant part of The Trade Desk’s business, accounting for much of its revenue. By creating its own OS, the company aims to have direct control over the streaming TV experience, potentially offering TV manufacturers and video providers a share in the advertising revenue generated on the platform.
This move comes as the competition for owning the living room TV experience intensifies. Industry incumbents like Roku, Amazon, and Google, along with challengers such as Titan OS, ZEASN (whaleOS), and Xperi (Tivo), are all vying for dominance in the TV OS market. With The Trade Desk entering this crowded space, the battle for control over the smart TV ecosystem is set to heat up even further.
The Take
The Trade Desk’s move into the TV OS market marks a significant shift in the ongoing battle to control the living room entertainment experience. In this high-stakes competition, owning the operating system is akin to controlling the gateway through which all content and revenue flow. As Ronny Lutzi, President EMEA at ZEASN, a leading independent OS provider, explains, “The device itself isn’t the focus; it’s the operating system that truly holds power, determining access and monetization opportunities within the living room.”
This competition has intensified, with established players and new entrants competing to secure their place. Companies like Vizio, which have traditionally relied on proprietary hardware and software, are now exploring licensing their TVOS to third-party manufacturers to expand their reach and bolster their advertising business. This shift toward diversification and expansion reflects a broader industry acknowledgment that the OS is not merely a technical platform but a critical business asset.
The growing concentration of power within a few operating systems could result in tighter control over the advertising market, potentially stifling competition and innovation. The Trade Desk’s entry introduces a fresh dynamic, offering more favorable revenue-sharing models and greater customization options for manufacturers, thereby challenging the status quo.
This competition goes beyond simply controlling TV screens; it’s about dominating the data and revenue streams they generate. As the OS becomes the central hub of living room entertainment, the companies that successfully navigate this complex environment will shape the future of media consumption.
The Trade Desk’s venture into the TV OS space, coupled with other industry players’ strategies, signals intense competition and innovation. The results of these battles will ultimately decide which platforms take control of the living room, which governs the flow of advertising dollars, and how content will be distributed and consumed in the coming years.
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