As streaming services search for ad revenue, expect more political ads — and minimal regulation

The 2024 presidential election is still about a year out, but political ads are already airing as campaign spending ramps up. These ads will continue to dominate air space on broadcast television this cycle, but they may also start to appear more frequently during ad breaks on streaming services. 

Over the past year, streaming services hiked ad-free subscription prices as more people made the jump from cable. They also added cheaper ad tiers, which are gaining traction among consumers who don’t want to pay up to $18 per month for a single subscription. As more streaming services pay attention to advertising revenue, space for political ads could increase. 

For almost 100 years, broadcasters have had to follow guidelines laid out by the Federal Communication Commission when running campaign ads. These rules require stations to air ads from any legally qualified candidates and charge them the cheapest rate, known as the “lowest unit rate.” 

Streaming services, on the other hand, are a relatively new territory for political advertising regulation. Since the FCC has no oversight over how political ads are streamed, the services are left to write their own rules and policies on the ads they choose and how they run them. The only guideline they have to follow is disclosing who paid for the ad, which is a Federal Elections Committee requirement. 

“FEC rules would govern that there would have to be the payment disclosure on there, just because that’s required, even for a yard sign, but beyond that, there aren’t any rules,” said Christopher Terry, an associate professor of media law at the University of Minnesota. 

More campaigns are taking an increased interest in streaming platforms because they find that videos are more effective attention grabbers than other forms of digital advertising, like social media posts and pop-up ads. 

“I think the campaigns’ interest in streaming is driven by their desire to recreate what they’ve had on broadcast,” said Travis Ridout from the Wesleyan Media Project. 

While more people are cutting the cord, campaigns and political groups are still investing in broadcast advertising because it reaches a majority of older people, who tend to vote at a higher rate than younger generations.  

During the 2022 election cycle, about 70% of campaign ad spending was put towards broadcast ads, compared to digital ads which received about 15% overall, Terry said. 

Although streaming services can charge any rate they want for ads, broadcast ads tend to be more expensive, Terry said. This is because there are a limited number of broadcast slots during the day, especially during times of high viewership like “Jeopardy” or the evening news, while streaming has more opportunities to show advertisements. 

“Streaming will be, at least in theory, will be much cheaper, because there’s functionally an unlimited amount of it available,” Terry said.  

Broadcasters may be making more money off of campaign ads than streamers, but Ridout said he has seen more services selling ads that didn’t before as more search for ways to fill increasing revenue gaps. 

“The inventory has really increased on streaming in the past couple of years,” Ridout said. 

As next November approaches, many of these services are solidifying their ad policies that state whether they will even accept political ads. Out of the 17 streaming services contacted for this story, eight responded with information on company ad policies around political advertisements. 

Among the services that answered, large streamers, like HBO’s Max, Paramount+, and YouTube TV said they are accepting political ads to run during programs. 

Paramount Global, the parent company of both Paramount+ and Pluto TV, says campaign ads require creative approval. They accept third-party political ads on a case-by-case basis. 

Big names in streaming like Netflix and Amazon Prime Video said they will not accept any form of political ads. 

Hulu did not respond to comment requests for this story, however, the streaming platforms began accepting political ads in 2022.