Editor’s note: Facebook and Google face increasing competition from two emerging rivals – Verizon combining with Under Oath and Amazon – says Technology Business Research Analyst Seth Ulinski.

HAMPTON, N.H. – TBR estimates Facebook and Google will capture approximately 55% of the $200 billion in digital ad spend in 2017. By leveraging a combination of global subscribers, engagement data and advertising technology (ad tech) to support ad buying and selling, both companies will command significant market share.

At a high level, Facebook capitalizes on ad opportunities via communication gateways and Google via queries (i.e., search), its DoubleClick suite and YouTube. Google’s ad business has a significant head start over Facebook’s; however, TBR anticipates the social media giant will only become more formidable in 2018 and beyond as Facebook builds its advertising business around its two globally distributed messenger platforms.

That said, two media technology vendors will emerge to challenge the Facebook-Google duopoly. Verizon is integrating AOL and Yahoo assets into Oath, which will combine numerous popular media properties plus a stack of complementary ad tech platforms.

Meanwhile, ecommerce heavyweight Amazon is ramping up its Amazon Advertising Platform and Amazon Publisher Services, adding value to the high-growth programmatic advertising segment via consumer shopping data Ad tech, a subsegment providing infrastructure and analytics for the larger digital ad industry, is led by the same advertising heavyweights; however, this market is more fragmented and complex, allowing vendors to compete via multifaceted omnichannel capabilities and channel-specific platforms (e.g., video), as well as measurement and analytics tools.

Competition will intensify around video and over-the-top content

TBR estimates digital video ad spend will approach $30 billion in 2017, growing 30% year-to-year. The big four ad firms have varying strategies for video content and its monetization. To date, Amazon is not a major player in this segment, as its Amazon Video platform is monetized via subscriptions, not ads. This compares to Google’s YouTube business, which is largely ad supported and includes a revenue share with content creators. Facebook’s video strategy is a work in process as it tests models that combine user-generated content (UGC) and professionally curated content from media companies.

The perils of UGC have been well-documented as advertisers have pulled millions of dollars in ad campaigns from YouTube and Facebook in the last few quarters, mainly attributed to objectionable content. TBR will be monitoring Oath’s video strategy as it unfolds — the cost of creating premium, award-winning original content is expensive, which may or may not outweigh the perils associated with UGC.

The ability to establish business models that leverage subscribers, engagement data and video content will be critical as Google, Facebook, Oath and Amazon compete for advertising market share.

With this in mind, internet, communications and telecom peers Comcast, which owns NBCUniversal, and AT&T, whose acquisition of Time Warner is pending, represent two more enterprise vendors with evolving media technology businesses.