Unlocking Connected TV Ad Inventory’s Secrets: Supply Paths, Carriage Deals, and Contracts

Let’s start with the basics. Advertising inventory refers to the total amount of ad space a publisher offers for sale across a media channel—whether it’s Connected TV (CTV), social media, search engines, magazines, or others—where advertisers can insert their ads. As you might expect, the amount of available ad inventory is vast and growing as more digital channels rise to fame.

CTV ads, one of the fastest-growing ad channels, are delivered in ad pods that play non-skippable video advertisements before, during, or after professional video content. As the streaming industry continues to expand, with more services offering ad-supported tiers, the selection of ad inventory seems endless—a double-edged sword for advertisers.

On the bright side, there’s never been more ad avails or publishers, giving advertisers unlimited avenues to reach their targeted audience. Advertisers have their pick from streaming services—Hulu, Peacock, Disney+, etc.—to find their audiences. The challenge, however, lies in understanding this complex ecosystem and gaining access to the full range of available ad inventory.

Understanding the pathways to supply is key to navigating the complexities of ad inventory in the CTV environment. Contrary to popular belief, ad inventory isn’t sold solely through streaming apps—there are many routes, or access points, to a single app’s ad inventory.

Take Hulu’s ad inventory as an example. For an ad to be delivered on Hulu, a streaming app, it must pass through a supply chain to physically be consumed by a viewer. The first stop is an operating system, which refers to the physical TV device hosting the viewing experience (Samsung TV, LG TV, etc.). Next is a digital media player—either built-in or external devices like Roku, Apple TV, or Amazon Firestick—which connects the TV to the internet and hosts streaming apps in its app store. Lastly, the ad reaches its destination on a streaming app (Netflix, Hulu, Disney+, etc.) where the content is hosted.

Given the sheer number of operating systems, media players, and apps available, the supply pathway quickly multiplies into thousands of individual routes to account for each unique entity. For instance, a Hulu ad could be viewed on a Samsung TV through a Roku player, or on an LG TV through an Amazon Firestick. And it doesn’t stop there. Holding companies, networks, and content owners further complicate the journey. In short, many players are necessary for streaming content and streaming ads to be consumed.

Understanding the relationships within the supply pathway is essential for making informed decisions when buying ad inventory. Streaming apps are not entirely self-sufficient—they lack their own digital media players, operating systems, and often don’t produce all of their own content. Since they depend on other companies to deliver their content to viewers, they must relinquish some of their ad inventory as compensation.

In exchange for distribution via digital media players’ app stores and compatibility with physical TVs, streaming apps provide a portion of their ad inventory for these partners to sell. This arrangement, known as a carriage deal, is a standard practice throughout the CTV ecosystem. Carriage deals between streaming apps, operating systems, media players, and networks result in a distribution of ad share, where each party controls and sells a portion of the total ad inventory. As a result, a single app’s ad inventory can be accessed through multiple entry points, offering various opportunities for advertisers to buy a single app’s ad inventory.

Now that we’ve explored carriage deals, let’s dive into how ad inventory is distributed across apps, networks, digital media players, and operating systems. While allocation varies by platform, apps generally allow digital media players and operating systems to sell a combined 5% of their total ad space, with each platform controlling 5% of the inventory available through its unique distribution route. For example, Roku, as a digital media player, can sell approximately 5% of the Hulu ads viewed on Roku devices. This only applies to ads served via Roku, not 5% of Hulu’s overall inventory.

The remaining ad space for Roku users is sold directly by Hulu or networks. Across all operating systems and media players, these carriage deals result in about 5% of an app’s total ad inventory being allocated to third-party platforms.

When it comes to network content hosted on streaming apps, ad distribution becomes more complex. In this case, the network retains control of the ad inventory and typically allocates 10% of its ad space to the streaming app in carriage deal. For instance, if a FOX show is available on Hulu, 5% of ads are sold by digital media players and operating systems, 10% by Hulu, and the remaining 85% is sold directly by FOX.

With multiple networks’ content available on a single app and tens of digital media players and operating systems supporting viewing experiences, the access points quickly pile up. And that’s just for one app! Consumers typically use a handful of streaming apps, each with its own ad inventory spread across a variety of companies. As a result, reaching 100% of the CTV market can seem impossible, but with ecosystem expertise and strategic partnerships, it can be accomplished.

Now that we have a clear view of the CTV landscape, let’s explore the process of purchasing ad inventory. To access 100% of an app’s total ad space, media buyers must secure individual contracts with each operating system, digital media player, and network the app is connected to, in addition to the app itself. These private access contracts grant buyers the right to bid on the specific ad inventory controlled by each entity, ensuring comprehensive access.

While some smaller apps may offer “open inventory” that doesn’t require contracts, most major streaming platforms operate through these agreements. Moreover, many publishers enforce minimum monthly spend requirements, often around $50k, which raises the entry cost for a single campaign. This pricing barrier makes it difficult for agencies to activate lower-spend accounts, effectively shutting out small businesses in local markets, such as individual dealerships, from accessing these platforms.

For example, securing 100% of the ad inventory for Monday Night Football would require contracts with multiple parties: each operating system, digital media player, Hulu, Fubo, Sling TV, the parent company (Disney), ESPN, and the NFL. Without agreements with all these entities, you can’t reach the entire audience. Buying through Hulu alone, for instance, would only provide access to roughly 10% of the available ad space for that event.

An individual app may require dozens of contracts to unlock most of its ad inventory. When you consider the vast number of apps with ad-supported tiers, it becomes evident how essential an extensive portfolio of contracts is for full market access.

Now that we’ve completed the long but necessary Inventory 101 lesson, let’s explore what sets EMG’s inventory apart. EMG has leveraged its strong partnerships and deep understanding of the CTV ecosystem to offer clients the broadest access to inventory, delivering superior outcomes.

200+ Individual Inventory Contracts

EMG holds over 200 contracts with every major operating system, digital media player, app, holding company, and network, giving us access to roughly 20,000 unique supply pathways, which is nearly 100% of the programmatically addressable CTV market.

Remember those minimum monthly spend requirements? Thanks to EMG’s exclusive partnerships, we have special permission to activate dealership accounts beneath the minimum spend threshold, giving you full access to the most platforms. Many of our contracts also include financial agreements that offer us strategic advantages, such as first-look access to ad inventory and priority bidding. These benefits allow us to consistently secure premium placements at the most cost-effective rates.

As the only independent trade desk with direct access to the supply exchange via our Supply Side Platform (SSP) seat, EMG is uniquely positioned to manage these private contracts, providing unmatched access to nearly 100% of the CTV market.

Why Doesn’t EMG Advertise on Netflix or Max?

While apps like Netflix and Max have introduced ad-supported tiers, their ad inventory isn’t available programmatically. Instead, advertisers must buy bulk impressions with zero audience targeting—a suboptimal strategy. EMG exclusively purchases media programmatically, using advanced data and automation to deliver ads to targeted audiences. Since these platforms lack targeting capabilities, EMG does not buy their inventory.

However, Netflix has recently announced arrangements with major DSPs and SSPs, meaning their ad inventory will soon be available programmatically and we can begin a partnership.

EMG’s Inventory Curation Process

A major part of our inventory value lies in EMG’s rigorous curation process. Drawing on data from 40+ million deterministic dealership arrivals, we continuously optimize and eliminate underperforming inventory pathways. Every inventory node we use ensures that viewers are engaged, maximizing ad performance.

We constantly test new inventory pathways as new apps and platforms emerge. By isolating and evaluating inventory performance by audience, we filter out nodes that underperform, ensuring that only high-quality supply pathways remain. For instance, conversion data revealed that overnight programming, disguised home screen ads, and apps designed for pets and babies underperform, leading us to block them from our inventory.

This meticulous approach has led to the elimination of several hundred underperforming nodes, ensuring EMG’s inventory is targeting an active, engaged audience.

As we began our lesson saying, the complexity of supply nodes and carriage deals is foreign to many marketers. They can’t be blamed; this ecosystem has never been more fragmented, and valid educational resources are hard to find. Many advertisers believe a contract with Hulu grants access to all of Hulu’s ad inventory, unaware that networks, operating systems, and devices also sell portions of that inventory. This lack of understanding leads to missed opportunities to reach valuable audience members. At EMG, we prioritize understanding these dynamics to give our customers the most opportunities to get in front of their valuable consumers.

One word defines us: expertise. EMG‘s deep understanding of the CTV inventory ecosystem shapes our strategies, granting us access to nearly 100% of the addressable CTV market. With premium financial entry points, no minimum spend barriers, and carefully curated supply paths, EMG ensures dealerships receive access to inventory that drives measurable results.

Reach your auto-intenders everywhere they watch with EMG. Start streaming today.