Samsung Smart TVs Force Ads Onto Menu Screen

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A Samsung TV shows an ad for Gamefly while a user browses the TV's menu.
A Samsung TV shows an ad for Gamefly while a user browses the TV's menu. Credit: Ad Age staff
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Consumers might describe Samsung's most recent update to its internet-connected TV sets as anything but "smart."

The South Korean-manufacturing giant rolled out an update earlier this month that forces consumers to see display ads on its app menu screen if they want to take advantage of its sets' smart-TV features.

The only way consumers can avoid the new ads is to disconnect their TVs from the internet, meaning they can't use its menu to access apps from streaming video providers such as Netflix, Hulu and Amazon.

The ads featured on Samsung TVs aren't obtrusive when they first appear at the bottom of the screen but consume a lot of space once highlighted, enlarging to take up a quarter or three-fourths of the screen, depending on the ad.

Over on Reddit, home theater enthusiasts discussing Samsung's recent move aren't happy. "Free service plus ads or paid service plus no ads, pick one Samsung," one user wrote. "Ads are a large reason why I ditched cable, the viewing experience wasn't worth the money with one-third of the broadcast time filled with ads."

Stephen Baker, VP and technology industry analyst at NPD, expressed concern about the longterm effects of Samsung's recent move. "I would be surprised if this had a huge impact on Samsung, at least certainly not in the short term," he said. "But there is a rolling effect to that and in the longer run, I worry about what the impact to sales would be."

New ads are not on most consumers' wish lists, Mr. Baker suggested. "This will backlash because consumers don't want that," he said.

Users at least have the option of opting out of interest-based advertisements and instead receiving ads that would be considered irrelevant to the user, Samsung said.

"We are always looking for ways to enhance the TV watching experience," a Samsung spokeswoman told Ad Age in an emailed statement. "Users can opt-out of these interest based ads at any time in the settings menu of their televisions and still get all of the smart features of their TVs."

Samsung's move to shoehorn ads onto its menu was first reported by the Wall Street Journal in May, but the update was quietly rolled out earlier this month.

Samsung is the dominant seller of TVs. In the last three months ending in November, Samsung had a 31% market share in TV sets, up from about 28% when compared to the same time last year, NPD said. It's rival and No. 2 market share holder, Vizio, has a 15% market share for the most recent time period.

The electronics maker is looking for wins, not complaints, as it reels from the aftershocks after its recalled exploding Note 7 smartphone. Last month the company ran an ad in daily newspapers apologizing to consumers and signed by Gregory Lee, president of Samsung Electronics North America.

"At Samsung, we innovate to deliver breakthrough technologies that enrich people's lives," Mr. Lee wrote in the note to customers. "An important tenet of our mission is to offer best-in-class safety and quality. Recently we fell short on this promise. For this we are truly sorry."