Television broadcasters are poised to see ad revenue growth this year when compared to other off-election years but face the dual challenges of encouraging viewers to climb aboard the NextGen TV train and rethinking traditional ingest, traffic, master control and playout workflows to cash in on streaming and FAST channel opportunities.
Those were some of the major takeaways from the “Turning New Media –for Streaming & FAST to NextGen TV—into New Audiences” session March 13 during the 2025 TVTech Leadership Summit. Panelists Rick Ducey, managing director of BIA Advisory Services; Robert Folliard, senior vice president of government relations and distribution at Gray Media; and Mike Kralec, senior vice president/chief technology officer at Sinclair, offered their perspectives on a variety of issues related to building audiences on these platform. (Full disclosure, I moderated the panel.)
While digital media has experienced significant growth in local ad revenue since 2019, broadcasters are well-position to capture their share as the reach of IP-based NextGen TV to connected TV (CTV) viewers grows.
“As high growth as it (digital) is, we like to emphasize that local broadcast TV stations still are an amazing asset. Audiences love them. Advertisers love them, and a lot of dollars change hands in a good way for the business,” said Ducey.
Earlier in the month, BIA Advisory released its local ad forecast for the United States without political advertising. It forecasts all local ad revenue in 2025 will reach $171 billion, up 6.1% year over year from 2024 when political advertising is removed. Digital media, which includes streaming, Free Ad-Supported Television channels and many non-video-related media, will account for 52.5% of local advertising revenue this year while traditional media, including over-the-air TV, cable TV and other non-video related media, will claim 47.6% of the revenue, Ducey said.
“The takeaway here is that in 2019 when it was just over a third for the digital side of things, now we see it being 56% in 2028,” he said, adding that local broadcasters can compete effectively for digital ad revenue with FAST and NextGen TV channels.
Promoting NextGen TV
Gray Media had launched ATSC 3.0 at 44 stations as of the panel, covering 33 markets. It is on-air with NextGen TV in all of the station group’s top 50 markets with the exception of Cleveland and Memphis, which Gray is targeting for 3.0 launches, said Folliard.
“…[W]e are aggressively getting up as many stations in as many markets as we can just to gather more consumer demand, get more consumer interest in the technology and launch it everywhere the regulators will let us,” he said.
Gray Media has focused much of its promotional efforts on touting the improved picture quality high dynamic range (HDR) offers NextGen TV viewers, he said.
“One of the big promises broadcasters have been making for six [or] seven years on NextGen is that it’s going to be a better picture. So, we felt it was time to deliver. Put up or shut up, and the first opportunity for us was the [2024] Kentucky Derby,” said Folliard.
WAVE-TV, the Gray Media NBC affiliate in Louisville, Ky., broadcast Dolby Vision HDR and Dolby Atmos immersive audio via 3.0 in the week leading up to the horserace during local news and special productions from Churchill Downs.
“This was the perfect opportunity to showcase what HDR can do because it’s an outdoor event. You’ve got the lights…, the bright colors of the horses and the jockeys…. [I]t pops in HDR, and this was the perfect showcase event.”
The station “promoted the heck out” of its NextGen TV HDR coverage leading up to the race on-air and online. It also partnered with a local retailer on a NextGen TV giveaway to viewers. The effort “definitely created a buzz,” he said.
“Afterwards, we looked at some of the data in terms of new TVs that signed on throughout the entire country and then just in Louisville, Ky.,” he said. “And just in the couple of weeks before and after the Derby, 10% of all new NextGen TVs that signed on were in Louisville, Ky.”
Next up was rolling out HDR on its NextGen TV NBC affiliates in time for the 2024 Paris Olympics, which Gray Media followed up on by rolling out HDR on some of its Fox and CBS affiliates in time for the 2024-25 NFL season.
Emphasizing that Gray Media is “technology-agnostic” when it comes to HDR, it has launched a couple of NextGen TV stations with SL-HDR. “Starting in December after we tested it with Samsung, we were able to do dual versions of HDR where you were able to do HDR10+ or the Dolby Vision HDR. And your TV would decide,” said Folliard.
For the Super Bowl, Gray Media launched its WVUE-TV Fox affiliate in New Orleans NextGen TV transmission with Dolby Vision and HDR10+, he said, adding that the group planned to [now is] offer March Madness in HDR.
“All of the features that we know are available with NextGen, we need to start telling consumers about it…. [W]e need to do it often you know, again and again and again, and this is just another example of that,” he said.
Ecosystem Choices
Whether its FAST channels streaming via the internet or NextGen TV, broadcasters will find they must reevaluate their workflows if they are to meet the goals they set for meeting viewers where they watch content and enabling audiences to benefit from enhanced viewing experiences, said Kralec.
“…I think the key here for us is how do we close… our own little digital divide between the legacy media operations that we’ve had for the last 20-plus years and where we need to be with the audience today,” he said.
Transformation is necessary in TV broadcasters’ content centers and automation and playout systems. “I think there are a lot of pieces here that really haven’t traditionally been enabled for this digital ecosystem,” he said.
Noting that Sinclair is proceeding with transformation of content centers, automation, playout, transmission and how it uses its spectrum, Kralec said the station group is pursuing a path that leads to a digital and software-defined ecosystem that ultimately will pay off in reaching the goals its business side and content creators are pursuing.
“A lot of that comes back to whether or not your operational workflows are either software-defined or if they are flexible. Flexibility might come from improved processes or improved software. It might come from improved operational models. But really the key here for us is to make sure that we shrink that divide through our transformation programs so we look a lot more like a FAST channel from an automation and playout [perspective],” said Kralec.
“We look a lot more like a content creator in our content centers, and then we look at our spectrum as more of a blank slate… than just an audio-video distribution path for us.”
However, there is no magic wand that will make these transformations painless. “This is an iterative process,” he said. “If we want to do dynamic ad insertion [for example], there’s a lot of orchestration behind the scenes that goes into that.”
Some of the orchestration will involve well-established operational centers, such as traffic departments and the systems they have used for years as well as programming schedules and media management. “…[N]ow we need to decorate those streams like the digital guys do already,” said Kralec.
However, undertaking this sort of transformation only makes sense once the calculus is done in comparing the benefits versus the pain involved in making the necessary changes, he said.
“Can we articulate to our business, what the value is and how much it’s going to take internally to transition to an improved workflow that supports that digital ecosystem, to my point earlier, that makes us look a little more like the digital side of things with the right cue points for dynamic ad insertion or… coming in and out of different types of digital products in general?”
This session and others at the TV Tech Summit can be viewed on demand here.
