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eMarketer lowers US TV ad estimates due to cord-cutting

Watching_TV_2eMarketer has reduced its estimate for US TV ad spending due to “faster-than-expected growth in cord-cutting”.

The research firm said it now expects US TV ad investment to expand just 0.5% this year to US$71.65 billion – down from the US$72.72 billion it had predicted in its Q1 forecast.

This means TV’s share of total media ad spend in the US is expected to drop to 34.9%, before falling to below 30% by 2021.

“eMarketer expected a slowdown this year in TV ad sales, after 2016 benefited from both the Olympics and US presidential election,” said Monica Peart, eMarketer’s senior forecasting director.

“However, traditional TV advertising is slowing even more than expected, as viewers switch their time and attention to the growing list of live streaming and over-the-top platforms.”

eMarketer estimates there will be 22.2 million cord-cutters aged 18 and older in the US in 2017 – 33.2% compared to 2016.

It expects the number of US adult ‘cord-nevers’ to grow 5.8% this year to 34.4 million.

By 2021, the number of cord-cutters in the US will nearly equal the number of cord-nevers who have never had pay TV, according to the research.

“Younger audiences continue to switch to either exclusively watching OTT video or watching them in combination with free TV options,” said Chris Bendtsen, senior forecasting analyst at eMarketer.