That's not why, it's because the most important factor for people is price and tv with ads can sell for cheaper than the one without. I would never dream of touching a streaming service with ads but I'm clearly in the minority since I'm the only one paying the premium for ad free.
Are you saying TV prices dropped sharply once they started including the adware? It sounds more like the adware is selling at the same price point normal TVs were in years past, and the ad-free were relegated to a higher priced tier that didn't previously exist.