"Connected TV: The Next Gateway War Is in the Living Room"

Cord-cutting is old news at this point, but cutting the cord doesn't mean people stopped watching TV — they just moved to connected TV. A recently released number out of the US TV industry is genuinely symbolic: since late last year, streaming video's share of Americans' TV-watching time has surged to 47.5%, an all-time high, while traditional broadcast and cable combined only just clear 40%.

Viewing Habits Flip: The Streaming Era Reshapes the Living Room

When an American turns on the TV today, the first move isn't to flip channels anymore — it's to pick an app. That tipping point quietly happened last May; everyone was just too busy following AI news at the time to notice the living room quietly changing regimes.

The tech wars of the past 20 years have fundamentally all been gateway wars. Whoever controls the search box controls the traffic; whoever controls the App Store controls the developers. Now the TV gateway is on the move — and the concentration of this particular screen actually looks a lot like mobile operating systems: Android and iOS carved up the world's phones between them, and if you wanted to do business on a phone, you had to pass through one of their tollbooths first. The living room's big screen is walking exactly the same path — the only thing that's changed is the tollbooth's name, now Google TV, Fire TV, or one of the handful of streaming giants' own systems.

Sure, some people will say streaming's already so bloated that people are canceling subscriptions — subscription fees stacking up month after month, who can keep up with that? That's called "subscription fatigue," and it's a fair point. But if you don't want to pay, that's fine too — the streaming giants have already thought of that: don't want to pay, just watch the ads.

Netflix's ad revenue topped $1.5 billion last year and is projected to roughly double this year; US connected-TV (CTV) ad spend is expected to hit about $38 billion this year, up 15% year over year — at that pace, it'll overtake traditional TV ad spend by 2028. So streaming, having already built the "sell subscriptions" highway, has now built a second highway: "sell ads."

This second highway is basically a winner-take-most game for streamers and platform giants. Global connected-TV ad revenue is roughly $44 billion this year, and it's projected to grow to $81 billion by 2030 — but by then, Google, Amazon, and Netflix combined could be pocketing roughly half of it. And so far, users seem perfectly happy trading ads for free content.

Beyond Google, which owns its entire ecosystem, the standout performer in connected TV is North America's Roku, which holds roughly a quarter of the US market. Roku originally made an unassuming little streaming stick that let people's TVs get online and watch OTT streaming services like Netflix.

Back when many TVs weren't smart TVs and couldn't connect to the internet on their own, people needed a device like that to get online. Roku sold its streaming sticks cheap — losing more money the more it sold — and slowly built a business on that loss-leading strategy. Plenty of connected TVs run Roku's operating system too. Roku behaves exactly like a phone maker in that sense; subsidizing hardware to buy market share is unglamorous, but it works. Roku is now the biggest connected-TV player outside the platform giants, with 80% of its revenue coming from ads and software fees — further proof that users love cheap hardware and don't mind ads.

What about Taiwan? According to a survey Taiwan's National Communications Commission (NCC) published last year (fieldwork done in Q1 2025), the average Taiwanese household owns roughly 1.6 CTV devices, and a separate industry survey from around the same time put smart TV ownership at 60%. Both numbers look fairly high. Taiwan's cable operators reacted quickly too, baking streaming functions directly into their set-top boxes and locking in households with bundled broadband-plus-streaming packages, which has helped fend off cord-cutting to some degree. On top of that, 80% of smart TV users use connected TV to watch YouTube — also a high number, and evidence that YouTube is already the single largest content provider on connected TV.

Beyond the major shift in advertising that connected TV has brought, the smart TV is also a setting where AI can operate quite effectively. AI's ability to converse in natural language has gotten good enough that voice-controlling your TV is now genuinely practical, and AI-driven recommendations will likely start dominating viewer choices the same way algorithms already do on phones.

A lot of people used to think smart speakers would be the control hub of the smart home. That never quite happened. What we're seeing instead is that most households end up with a smart TV, but not necessarily a smart speaker. Given how many smart TVs run Android, Google already owns the AI access point we're all but guaranteed to open — which is why Google is pushing so aggressively to put Gemini AI directly onto TVs. However you route around it, users seem to keep ending up back at Google.

AI Investment Opportunities Emerge: The Smart TV Becomes the New Gold Mine

TV has been declared dying for nearly 20 years — "young people don't watch TV anymore" has been the refrain since forever — and yet it never actually died. It just grew a new body and kept going: the set-top box became a streaming stick or a smart TV, changing the channel became picking an app, ratings became programmatic ad-impression bidding.

That screen in the living room hasn't gone anywhere. What's changed is who's fighting over it — it used to be the broadcasters, now it's the tech giants. The point was never really who's staring at which screen; it's who collects the ad dollars in front of that screen. The AI application layer is bound to cut into this space too — from an investment angle, it's worth looking at which companies stand to benefit. Wherever AI shows up, that's where the investment opportunity is.