Comcast Cable Spinoff Is Historic Turning Point for TV Advertising

Last week could very well mark the point when the migration of ad dollars from linear TV to streaming began accelerating to terminal velocity.

The news, confirmed last Wednesday, that Comcast will spin off most of its NBCUniversal cable networks carries a number of profound implications for the media business, but especially significant is its potential impact on the video ad market. With the next few years already poised to become an era of rapid expansion for connected TV formats, this new transformation of the linear ecosystem is likely to hasten advertisers’ exodus away from cable almost altogether.

The trend is already inexorable, of course. S&P Global Intelligence data projects U.S. cable ad revenues to fall 4% year-over-year in 2024 and 3% in 2025, as well as to drop below $20 billion by 2027 (levels not seen since 2007).

But as Variety’s Brian Steinberg noted, the Comcast spinoff “is likely to create two smaller companies with opportunities less vast than those of competitors … In the past, NBCU could use its big-tent sports broadcasts, primetime schedule and late-night array to spur sponsors to buy some cable for additional ballast. Now, cable will be all alone.”

And all alone with a declining audience at that. What will be left to attract advertisers to platforms shedding viewers at an ever-accelerating clip, with desirable content either falling away entirely or seeing its audience migrate to streaming? Bravo, the lone NBCU cable network not being spun off, will see a 5% drop in subscribers next year, per S&P Global data, with viewership for its still-popular content now being fueled by Peacock instead.

There is, in other words, very little upside for advertising on cable networks separated from the NBCU machinery, and the change could set a template for other media giants to divorce themselves from at least some of their cable operations. Comcast leadership has made no secret of the fact that the new “SpinCo” will need to partner with more companies — or “play offense in a changing media landscape,” as Comcast president Mike Cavanagh put it — to succeed.

And while CTV’s growth cannot come fast enough to offset linear TV declines, the streaming ad ecosystem remains on track for a banner year in 2025.

Amazon’s expansion of CTV ad inventory via Prime Video this year has already pushed down the cost of advertising on AVOD, with the average CPM (the cost advertisers pay per thousand ad impressions on the platform) among the biggest U.S. streamers projected at about $31 for Q4, versus more than $35 at the start of the year, according to eMarketer data.

And those costs are expected to fall further, with the average dropping to less than $29 by Q2 2025 in eMarketer’s forecast.

Meanwhile, the audience for ads on streaming continues to expand. Netflix’s latest periodic update on the state of its AVOD business revealed the ad tier now reaches 70 million users worldwide, more than triple the 23 million disclosed at the beginning of the year.

And on Disney’s recent fiscal Q4 earnings call, CEO Bob Iger revealed (possibly by accident?) that nearly a third of the Mouse House’s global streaming subscribers — 37% in the U.S. — are on ad-supported plans, with a whopping 60% of all new U.S. subscribers opting for the ad tiers.

“The [increased] pricing that we recently put into place … was actually designed to move more people in the AVOD direction, because we know that the [average revenue per user] and interest in it from advertisers in streaming has grown,” Iger noted.

That interest will only increase, of course, with the innovative ad formats unique to streaming continuing to expand as well. Warner Bros. Discovery just announced an AI-powered shoppable ads format for Max, while Amazon is in the process of rolling out more interactive ads to Prime Video, part of its plan to ramp up the ad loads on the service over the next year.

And that’s not to mention another bombshell development in the CTV space last week: The Trade Desk finally confirmed rumors that the programmatic advertising giant is building its own smart TV OS, coming to market in the second half of 2025.

The arrival of TTD’s “Ventura” OS has potential to reshape the CTV ad ecosystem, should the company’s visions of a more transparent and streamlined marketplace come to pass. If indeed the OS succeeds at simplifying the byzantine pipelines of CTV advertising, ad dollars will begin flowing through the marketplace at far greater speed and efficiency. (The press release announcing the OS promises “a much cleaner supply chain for streaming TV advertising, minimizing supply chain hops and costs — ensuring maximum ROI for every advertising dollar and optimized yield for publishers.”)

CTV, in short, is already poised to accelerate its ascendant trajectory, but the now-hastened decline of cable will only result in ad dollars migrating to the format even faster. When the history of this tumultuous transition is written, Comcast’s decision to split off its networks may well be cited as the tipping point.