The Trade Desk’s Strategy for Its CTV OS Ventura? Give the Money Away

The Trade Desk is rethinking what it means to build an operating system for connected televisions—and who it is for. In its push to scale Ventura, the CTV OS it unveiled in November, the company is targeting an unfamiliar kind of client: the original equipment manufacturers that design and produce the smart TVs sold across U.S. retailers. To get them on board, according to Ventura senior vice president Matthew Henick, the company is pitching an unusually generous model: give the OS away, let the OEMs keep the bulk of the ad revenue, and run the rest of the business at break-even. “Most advertising revenue is not going to sit with us directly,” Henick told audiences during a panel at the National Association of Broadcasters Show in Las Vegas on Wednesday. “It's going to go back to the OEM or the publisher to divide up however they see fit. That is a bucket of revenue that OEMs don't usually get to participate in.” An OS that caters to OEMs The upside for OEMs is clear. TVs are typically sold once every five to seven years, with minimal profit per unit, according to Henick. Ventura offers an ongoing revenue stream via home screen ads, remote buttons, and subscriptions, potentially boosting margins for both manufacturers and retailers with house brands. And by staying neutral on content, Ventura avoids conflicts of interest with publishers. If the offer seems enticing, that is because it needs to be. Ventura faces an uphill battle in gaining adoption in an already saturated ecosystem, and it needs distributor partners for Ventura to reach the “minimum viable distribution” it hopes to achieve. In March, Sonos shelved its Pinewood TV project, a device widely believed to be one of Ventura’s first hardware partnerships. The Trade Desk declined to comment on the matter. Still, some 40 million new TVs are sold every year, according to Henick. And while Ventura has not yet confirmed any launch partners, the conversations are ongoing. “If you make the device, you should be able to decide how it's monetized,” Henick said. “We’re here to help make that possible.” Bringing SPO to CTV The approach is a sharp departure from the status quo, where companies like Roku, Amazon, and Google often take a significant share of ad inventory and subscription commissions in exchange for their software. Ventura also aims to fix a core inefficiency in how most CTV inventory is sold today. To have their apps appear on an OS, publishers often have to agree to either a revenue share or an inventory share, according to Henick. In the latter, publishers often demand that the inventory they let the OS sell must be mixed with other video supply. Otherwise, advertisers would have access to their premium inventory at a discount. Operating systems comply by co-mingled different sources of inventory, which obscures what is being bought, where it is running, and who is watching. The Trade Desk does not source that promiscuous inventory for marketers through its demand-side platform, and it does not want to facilitate it through its OS, according to Henick. So, it eliminates the problem by refusing to take an inventory cut at all. The OS is also designed to be modular, letting OEMs customize the user experience, maintain their branding, and run their own monetization layers. If an OEM wants Ventura to power ads and transactions, it can. If it prefers to use Ventura only for underlying tech while keeping its own ad sales stack, that works too. Either way, Ventura will not operate a FAST channel or compete for content. “We’re giving that control back to publishers and OEMs,” said Henick. “That means advertisers can more confidently bid on specific inventory, and publishers can protect their value.”

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The Trade Desk’s Strategy for Its CTV OS Ventura? Give the Money Away

To grow adoption, the adtech company is courting TV makers with a break-even OS model

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Mark Stenberg

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