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Singapore TV ad spend growth to fall 10% in 2015 while online video surges, China sees TV adex growth dip for first time on record

Growth in TV advertising spend is expected to fall by almost 10 per cent year on year in Singapore in 2015 as online video begins to eat into traditional ad spend, according to data from media agency Zenith Optimedia.

Ad spend in Singapore growth year on year

Ad spend growth year on year in Singapore; source: ZO, Nielsen

Spend on traditional linear TV is expected to fall from, according to Zenith Optimedia and Nielsen estimates, US$646.2m in 2014 to $583.4m this year, and by a further $40m, to $541.5m by 2017. Meanwhile, spend on online video between 2014 and 2017 is expected to almost double, from $9.6m in 2014 to $18.8m in 2017.

However, online video viewing growth is slowing, despite Singapore’s average internet connection speed being the highest in the region, and growth of linear TV is holding firm.

Regular growth TV versus online video in Singapore

Regular viewer numbers year on year in Singapore: source: ComScore, ZO estimates

Slower growth in online video is “largely because there is not much content produced locally, and at the same time there is a ban on popular western TV series via the likes of Netflix and Hulu,” the media agency’s report reads.

China will for the first time see growth in TV advertising decline, partly because of the rise of online video, the report finds.

Growth in linear TV advertising will fall fractionally, by 0.5 per cent, but online video growth will slow too from this year through to 2017.

Online video growth versus linear TV

Regular viewer numbers year on year growth in China; source: ZO, SAIC

China’s online video advertising market was worth US$1.16bn in 2014, and is expected to grow to $2.9bn by 2017. The country’s TV ad market will contract from $16.3bn in 2014 to $16.2bn by 2017, according to Zenith predictions.

China advertising spend year on year growth

China ad spend year on year growth; source: CMS, Sixth population census

By contrast in Malaysia, linear TV advertising spend continues to grow at a pace consistent with online video. Traditional TV ad spend in Malaysia is expected to rise from US$257m in 2014 to $502m by 2017, while online video will grow from $17m to $23m over the same time period.

Advertising spend in Malaysia year on year

Malaysia ad spend growth year on year; source: ZO, Nielsen

Growth in online video viewing will outpace linear TV, but linear TV is still growing in Malaysia – unlike in China and Singapore.

Regular viewer numbers year on year growth in Malaysia

Regular viewer numbers year on year growth in Malaysia; source: ZO, ComScore, Nielsen

Globally, next year will the first time that advertising spend growth on TV falls as a result of online video spend increasing, Zenith predicts.

TV growth versus online video growth

Regular viewer numbers online video versus TV; source: ZO

Consumption of online video globally is starting to see growth in ad spend to match.

Ad spend versus viewing time

Online video spend and consumption in minutes per day globally; source: ZO

Growth in online video consumption is increasingly on mobile devices, the report finds.

Mobile versus non-mobile

Time spent watching online video on mobile versus non-mobile devices; source: ZO

Zenith predicts that the total number of people watching online video regularly will increase by five to six per cent a year globally from this year until 2017, while the number of regular linear TV viewers will drop by 1.9 per cent in 2016 and by a further 0.9 per cent in 2017.

For ZO’s full report, click here.

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