The Trade Desk reportedly building its own smart TV OS
The Trade Desk is reportedly developing its own smart TV operating system (OS).
According to independent outlet Lowpass, the digital advertising giant is looking to compete with Google, Amazon and Roku, and has been quietly working on the OS since the pandemic.
The pitch to hardware developers is a more advantageous revenue-sharing deal and more flexibility to customise the user interface.
Lowpass reported that a device running the OS could launch as soon as next year.
The Trade Desk declined to comment when contacted by The Media Leader.
Strong partnerships
The company has seen its valuation rise by over 46% this year amid strong earnings results. Revenue climbed 26% year on year in Q2, led by high customer retention and continued growth in demand for its connected TV inventory marketplace.
In particular, The Trade Desk was one beneficiary of Netflix increasing the number of programmatic ad partners earlier this year.
It has also expanded partnerships with Fox and EW Scripps. In the Canadian market, CBC’s Olympics inventory this summer was made available programmatically through The Trade Desk.
With its own smart TV OS, The Trade Desk could seek to leverage its existing client base to buy the additional inventory created within the OS itself.
Rob Collier, head of strategy at MTM, said in an interview with The Media Leader this year that smart TVs could replace set-top boxes eventually, leading to new potential revenue for OS providers.
“What’s really interesting is that IP technology is changing the dynamics of who controls the UI within a household. Our view is that that allows TV UI operators to control prominence, discovery and fundamentally put themselves in a position where they have a say in how content is monetised,” Collier said.
He suggested that there was a financial incentive for smart TV operators to promote certain subscription services, take share of advertising revenue or create their own ad solutions around smart TV user interfaces.
Competitive market
The Trade Desk is not the only major player looking to expand into smart TVs. Google, for example, has gone from being “risible to credible” as a player in the TV market, according to Nigel Walley, managing director of media strategy consultancy Decipher.
At Sky Media’s Demystifying Data event last year, Walley said: “Keep your eye on Google… [TV] is not an ecosystem that they’re in total control of; this is not comfortable territory for Google as they shift from total dominance for some areas into a TV space in which they are, to a certain extent, ‘newbies’ — although, from a software point of view, very capable ‘newbies’.”
Speaking to The Media Leader on the latest news, Walley said he was “really surprised” to see the company developing its own smart TV OS.
“Not just because The Trade Desk have no experience in TV interface/OS design, but also because it has recently become a really busy space,” he explained. “Over the last few years, we have been expecting the market for smart TV OS to simplify down to a small number of players. But if anything, it’s done the opposite.”
He noted that, apart from Google, Amazon and Roku, The Trade Desk would also be competing with TV manufacturers, including Samsung, LG, Hisense, and Tivo, which all also license their own OS to others.
“Its hard to see which part of the market The Trade Desk are targeting here, unless they are actually creating a sub-OS (like Freeview’s Freely) that is designed to run on top of all of the above,” Walley continued.
Ian Daly, AV investment lead at independent media agency the7stars, previously wrote about the “financial incentives” for Samsung and LG in The Media Leader, as “both companies sell display advertising on their home screens and/or in-stream video within connected TV apps”.
The Trade Desk is reportedly developing its OS based on Android’s Open Source Project. In the past, Google has moved to restrict the use of Android-based OS on competitor devices, such as Amazon’s Fire TV, although a resolution was ultimately reached.
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