nScreenMedia’s back-of-the-envelope estimate of the TV OS market suggests it generated $4+ billion in the US in 2022. The top two providers, Roku and Vizio, own about three-quarters of the revenue.
TV OSs mainly earn revenue from ads
One of the main ways TV OS providers generate revenue is through advertising. There are three main sources of ad revenue:
- A negotiated share of a TV app provider’s ad revenue (or a share of their advertising inventory)
- Advertising placed in the user interface
- Built-in FAST services like The Roku Channel, Vizio WatchFree+, and Samsung TV Plus.
There are other potential sources of revenue for TV OS providers, including:
- A finder’s fee when someone signs up for an SVOD or vMVPD service on their TV OS
- TV OS license fees
- Billing, subscription, and user management fees.
However, ads are by far the largest pool of revenue for TV OS providers, likely delivering 90% or more of their revenue.
Figuring out how much money TV OSs generate is not simple. Only two major providers – Roku and Vizio – say exactly how much they earn from their TV OS. To estimate the others, nScreenMedia has used related public data and comparisons with known sources to come up with a back-of-the-envelope estimate of the market. Here is the data for each of the major participants in the US market.
Roku and Vizio
Roku and Vizio report on the performance of their ad-driven businesses in their quarterly financial statements. In 2022, Roku’s Platform business earned $2.7 billion from an average of 65 million active devices. Vizio’s Platform+ business earned $478 million from an average of just over 16 million active devices. Between them, they earned around $3.2 billion.
The biggest driver of ad revenue for Roku and Vizio are their built-in FAST services, The Roku Channel, and Vizio WatchFree+. The Roku Channel is available on other TV OSs, like Fire TV and Samsung Tizen. However, most viewing occurs on Roku-powered devices. Vizio WatchFree+ is only available on Vizio TVs and mobile devices.
In 2022, Roku delivered 87 billion streaming hours, mostly in the US, while Vizio delivered 17.4 billion entirely in the US. The revenue earned from each active device (ARPU or average revenue per unit) for Roku in 2022 was $43.25, and for Vizio was $26.40.
Samsung TV Plus/Tizen
Samsung licenses its TV OS Tizen to other TV manufacturers, but only Samsung TVs ship with it in the US. It earns most of its TV OS revenue from Samsung TV Plus, the Tizen built-in FAST service. Samsung told advertisers earlier this year that TV Plus reached 17.4 million monthly active devices in the US. It also says it streamed 3 billion hours of content in the year to August 2022 to TV Plus users across the globe.
Samsung has about the same number of TV Plus users as Vizio has active devices in the US. But Vizio delivered more than four times as many streaming hours as Samsung. Since viewing hours is proportional to ads seen, I would expect ad revenue earned by Samsung smart TVs in the US to be around $100 million in 2022.
LG webOS and Channels
LG’s TV OS, webOS, has a built-in FAST service called Channels. LG also licenses webOS to other TV makers, although no non-LG brand TVs were shipping in the US using it in 2022. LG has provided no data on either the revenue earned by webOS or the performance of Channels. However, we can estimate roughly how much revenue it might have earned in 2022. According to TiVo, LG Channels had half the users of Samsung TV Plus in the first half of 2022. So, it likely earned at most half of the revenue, or around $50 million.
Chromecast/Android TV/Google TV
Google said that there were 110 million monthly active Android TV and Google TV devices. However, the figure doesn’t help us much here because it is a global number and includes operator set-top boxes and connected TV devices.
However, Conviva data from 2021 showed that Google TV/Android TV/Chromecast devices drove about the same number of viewing minutes as Samsung Tizen. Google charges apps and services using its TV platforms 30% of revenue and has one of the world’s most highly developed ad ecosystems. So, it likely does much better than Samsung from roughly the same engagement per active device. It likely earned between $200 and $300 million in 2022 from its TV OS.
Amazon Fire TV
Amazon licenses Fire TV to other TV manufacturers, although the TVs have so far not made a significant impression on the US TV market. Therefore, most Fire TV devices in the US are Fire TV sticks and cubes. The company has become the biggest seller of the devices in the US. This market leadership position allowed Fire TV to grab an 18% share of TV viewing time in 2021, almost twice Samsung Tizen’s share.
Amazon has done a great job tightly integrating FreeVee, its FAST service, into the Fire TV interface. The interface also does a great job – like Roku and Vizio – driving people toward ad-supported content. However, much of Fire TV viewing remains ad-free. So, though it drives almost double the streaming time than Samsung, it is likely earning roughly the same in ad revenue from its TV OS, or around $100 million in 2022.
What is not included in this estimate of Amazon’s TV OS revenue is the impact of Channels, the company’s very successful SVOD aggregation service. There are likely several million US subscribers to SVOD services through Channels, with Amazon taking up to half the subscription fee. It could easily double the estimate of Fire TV OS’s revenue. However, it is impossible to provide a reasonable estimate without some initial or comparable data.
Apple’s TV OS and Fire TV
Though Apple TV earned a significant share of connected TV viewing minutes in 2022, it earned little revenue from its TV OS. Aside from Friday Night Baseball, there are no ads in the Apple TV interface or in Apple TV+.
The total revenue
This rough estimate suggests that the TV OS market generated a little over $4 billion in 2022. Is this a reasonable number? eMarketer says the US-connected TV advertising market was worth $21B in 2022. That suggests the TV OS providers took about 20% of the total. The top-earning TV OS by far is Roku, with almost two-thirds of the market. Vizio is a distant second with 11%.
I have allowed $500 million, possibly an over-generous amount, to account for other TV OS participants, like Xumo, Vidaa, and Apple TV.
Note: This analysis is intended as a rough guide to the TV OS market size and ranking of the participants. TV OS earnings could be very different from the numbers indicated.
If you think I’ve missed something, why don’t you enter it in the comments below?
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