$100 CPMs and the Future of TV Ad Prices

Four big questions re: TV ad prices?
1) How much do TV ads cost today?
2) Why will TV ads cost more in the future?
3) How much will TV ads cost in the future?
4) How do prices for other ad types compare?

Setting the table: A few weeks back, I spoke to a room full of senior media buyers—some of the most experienced minds in our business. I knew parts of my talk would be controversial, so (with ChatGPT’s help) I made the following graphic.

I asked a simple question:

“How many of you believe streaming ad prices will grow faster than inflation over the next 5 to 10 years?”

Not a single hand went up.

I was stunned. These weren’t junior planners. These were the decision-makers — the people shaping billions in ad spend.

For a moment, I second-guessed myself.

Had I misread the market?

But the more I dug into the data, the more confident I became.

Not only will streaming ad prices rise, but they’ll likely outpace inflation by a wide margin.

And here’s why… 

How much do TV ads cost today?

TV CPMs by format (all households):
1) Linear TV - $7
2) Streaming - $20
3) Total TV - $9

Fun fact: Sports costs 10X more than the average linear TV ad.

TV ad CPMs by type:
1) Linear - Broadcast (Sports) - $70
2) Linear - Broadcast (Primetime) - $47
3) Streaming - AVOD - $30
4) Linear - Cable (Primetime) - $25
5) Streaming - FAST - $11

Why will TV ads cost more in the future?

Three big trends will drive substantial price increases:
1) Less supply
2) Increased demand
3) All impressions will be available to every advertiser

Declining supply: Between 2023 and 27, Brian Wieser estimates the supply of TV ad impressions will decrease by 24%, or 5%+ per year.

% change between 2023-27:
1) Ad impressions - ↓ 24%
2) Video ad spend - ↑ 6%
3) CPM $ - ↑ 48%

Wow: If this were true, TV ad CPMs would grow at a 10% annual rate (CAGR).

Reality check: Obviously, this is not happening yet.  Both streaming (Prime Video, etc.) and upfronts face downward pressure.

Increased demand: More advertisers, especially local ones, are coming into streaming. National TV advertising is dominated by 200 advertisers with tremendous pricing power. Facebook's 10M advertisers have no pricing power or leverage (see failed boycotts).

Back in 2022, we estimated there were 1M video advertisers in the U.S., and nearly 79% were digital-only.

All impressions available to all advertisers: Only 11% of linear TV ad impressions (2 minutes per hour) are available to local advertisers.

Why this matters: When all advertisers are in the same auction/marketplace, each impression goes to the advertiser who values it most. Large national brands will be outbid by smaller advertisers who value the impression (audience + geo) more.

How much will TV ads cost in the future?

Mr. Screens’ Crystal Ball: By 2030, some TV ads will hit $100+ CPMs — especially in high-value categories.

Here’s how this will happen:
1) Phase 1 - Political + niche advertisers pay $100
2) Phase 2 - Sports like the NFL cross $100
3) Phase 3 - Premium streaming with better targeting hits $100
4) Phase 4 - The average streaming CPM hits $100

How do prices for other ad types compare?

Quick answer: Other ad types already show wide price swings:

Why this matters: As a sanity check, I wanted to see what other ad types looked like.  A $100 CPM is roughly 5X what we currently pay on streaming ($20), which is more likely if advertisers already see similar spreads on other ad types.

Addressable linear TV: Advertisers already pay 3-5X higher CPMs for addressable linear compared to linear overall.

Linear TV dayparts: Depending on the daypart you are buying, linear TV advertising can be 4X more expensive.

Linear CPM to reach 18-49 according to Nielsen:
1) Primetime - $77
2) Late-night - $55
3) Daytime - $20

Linear TV demos: Simulmedia saw the same trend when they looked at the cost to reach 18-25 with linear TV. Shocker, it is right at a $100 CPM. If your customer falls into that demo and you buy linear TV advertising, you already pay $100 CPM!

Google search: The average cost-per-click on Google is roughly $3, but it can range from as low as $0.40 (community events) to $500 (lawsuits). Depending on the audience and intent of the ad, a click on a Google search ad can be 1,250X more expensive.

Meta ads: The CPM to reach audiences on Meta can be 7X higher as you try to reach older audiences.