Telaria Rides A Tailwind As Premium Publishers Embrace CTV

Over the past two years, connected TV (CTV) has gone from a niche rounding out linear TV audiences to a core component of premium video publisher’s inventory supply.

That evolution has paid off for supply-side platform (SSP) Telaria, which recently shifted its focus away from desktop and mobile video to enable publishers to monetize their CTV inventory. The platform, which is the exclusive SSP for Hulu’s private marketplace, saw revenue grow 47% year over year to $18.2 million in Q2.

Telaria’s CTV revenue increased 133% to $7.1 million, representing 39% of Telaria’s total revenue.

“CTV remains at the core of our strategic focus, tech investments and market position,” Telaria CEO Mark Zagorski said on the earnings call Tuesday. “As inventory grows, the opportunity to monetize it programmatically is as well.”

The rapid growth of cord cutting – 30% of US households no longer pay for cable or satellite subscriptions, according to eMarketer – has allowed Telaria to deepen its relationships with large premium publishers looking to recoup that audience over-the-top. As Telaria brings on more top-tier media brands, eCPMs are up 33% to $15.41 in the quarter from $11.58 a year ago.

And as more ad-supported CTV networks like Tubi, Pluto TV and Hulu attract audiences, programmatic inventory is opening up for Telaria to monetize.

“The guys that are driving inventory increases are digital-first entities,” Zagorski said. “They’re more comfortable with programmatic and have seen it as an important part of how they move inventory.”

On the buy side, Telaria is making inroads as CTV becomes more central to advertiser media plans and is even seen by some as a replacement for linear TV. Knowing that the CTV industry is still more like TV than digital, Telaria has taken steps to make buyers more comfortable transacting programmatically, like rolling out a comprehensive transparency plan and integrating Nielsen metrics.

Initial partners engaged in Telaria’s transparency program, which breaks out granular auction data and take rates, increased their investment in the platform 300%, Zagorski said.

“Transparency differentiates us in a marketplace becoming increasingly wary of black-box tech and controlled systems,” he said.

As CTV becomes a bigger part of the media pie, Telaria’s relationships with networks and publishers are getting stickier. While the platform inked new clients like MLB TV, Fox News, ABC News and Sinclair News On, Telaria makes a majority of its revenue from recurring clients that are investing more in the platform over time, Zagorski said.

While Telaria still operates on a standard take-rate model, the company sees a mid- to long-term opportunity to move to an enterprise SaaS model as more publishers put their inventory in fewer SSPs, as a result of supply-path optimization.

“We see a future in which this business becomes more stable as more clients become comfortable [working] with a single platform,” Zagorski said. “Enterprise clients are looking for more stability in their ongoing fees as well as longer term relationships.”

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