The Future of CTV in LATAM

1. The CTV Gold Rush: AVOD and FAST in Brazil and Mexico

Imagine the Latin American CTV market as a field of small, scrappy prospectors with gold pans, peering hopefully at the U.S. market—which is sitting comfortably on its shiny mountain of nuggets. But here's the thing: LATAM's prospectors have just started realizing there's gold beneath their feet too. Let me walk you through how it all plays out.

Right now, the CTV market in Latin America is tiny. If the U.S. CTV market were a whale, the LATAM market would be a minnow with big dreams. Revenue in this region currently falls between $20 million and $50 million annually—which is almost laughable when you think of the U.S. market, but it's growing fast. This minnow wants to be a whale.

The conversation with the Senior Manager for Content Acquisition at Samsung TV LATAM reveals that things are changing, and fast. The market is doubling year-over-year. This rapid growth means that by 2027, Brazil alone is projected to become the fifth biggest market, pulling in a crisp $100 million annually. Not bad, right?

What’s Driving the Growth? Two Big Factors

So, why is the LATAM market growing? The answer is simple but multifaceted—it's about access and tech. Let me break it down:

1. Broadband Penetration: Before the pandemic, only 35% of LATAM households had access to broadband. Now that number's climbed up to 50%, and we’re seeing average speeds above 20 Mbps. Remember when you first upgraded from dial-up internet and felt like you could download the whole internet in a day? Yeah, that's LATAM right now.

2. Smart TV Adoption: About 50% of households still haven’t made the leap from their old, clunky, tube TVs to shiny new Smart TVs. But they’re upgrading—and as they do, the addressable market for CTV grows.

2. The Love Triangle: AVOD, FAST, and CTV Advertising

Now, in LATAM, we’ve got three players: AVOD (Ad-supported Video On Demand), FAST (Free Ad-supported Streaming TV), and CTV Advertising. These players are like members of an odd love triangle—each contributing to the market's growth, but in different ways.

Currently, FAST is the main character in our story. AVOD is present, but FAST is where the action is happening. FAST channels have been exploding, providing linear content to those who love the nostalgia of "flipping channels." In Brazil, FAST is the main driver, much like a high-speed train. AVOD is a bit newer, launched just a few months ago, and it’s more like that slow tram you take at the airport—useful, but not thrilling.

3. Monetization Strategies: Where’s the Money?

Let’s talk about advertising. In LATAM, CTV advertising is not nearly as sophisticated as in the U.S. market. For now, 2/3 of all ad revenues are coming through direct sales rather than programmatic methods. Think of it like selling lemonade at a stand versus selling it through Amazon—we’re still at the stand.

The market is maturing, and we're beginning to see more interest from international advertisers. Companies are setting up shop, but most of the action is still based on direct relationships rather than algorithms deciding where your ad should go. It’s traditional, it's old school, but it’s working.

4. The Whale, the Minnow, and the Ocean of Opportunities

In summary, the CTV market in LATAM is at its early stages, but it’s evolving quickly. With more people connecting to broadband and upgrading their TVs, the potential here is immense. AVOD and FAST are both set to play a crucial role, with FAST currently leading the charge. And as the infrastructure and market maturity follow suit, we may soon see a shift towards programmatic advertising.

But for now, it’s all about laying down the basics—getting broadband, getting those smart TVs, and then figuring out how to monetize all of this content. The minnow wants to grow into a whale, and the ocean looks wide open.