Warner Bros. Discovery, Netflix Kicking FAST/AVOD Service Tires
February 15, 2023
Following the high-profile debut of Fox Corp.’s free ad-supported streaming TV (FAST)/AVOD platform Tubi on the Super Bowl LVII broadcast, the AVOD market is stepping out further from under the subscription streaming VOD shadow.
Warner Bros. Discovery and Netflix are reportedly eyeing potential standalone free ad-supported streaming services to compete with a burgeoning FAST/AVOD market that includes Paramount’s Pluto TV, Chicken Soup for the Soul Entertainment’s Crackle and Redbox Live TV, The Roku Channel, Comcast/Charter’s Xumo, Shout Factory TV, Cinedigm’s Cineverse and Amazon Freevee, among others.
The FAST/AVOD market is projected to up revenue to $30 billion in the U.S. by 2026, according to Digital TV Research. Tubi, which Fox acquired in 2020 for $440 million, alone is eyeing $1 billion in advertising revenue this year.
Now, Warner Bros. Discovery, under a push by CEO David Zaslav, and Netflix are looking under the AVOD hood at potential service launches.
Alarmed by the fact that 60% of the HBO Max SVOD service’s content is not consumed by subscribers, Zaslav has aggressively sought to monetize said content on both third-party and proprietary FAST/AVOD platforms. WBD, which recently inked AVOD license deals for a host of TV shows to The Roku Channel and Tubi, also wants to market select programming on its own platform, dubbed WBTV, according to Bloomberg.
Speaking late last year to a Wall Street investor group, Zaslav contends WBD can create a standalone FAST/AVOD service stocked with Warner Bros. Television catalog shows, rather than just licensing third-party content. The television production unit is the largest in Hollywood, generating around 100 shows currently in production, according to Zaslav.
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“We recognize that there’s a huge number of people in every country that aren’t going to pay [for a subscription streaming service],” Zaslav said. “That will position us, in terms of aggregating an audience, better than anybody.”
Netflix, which just launched a lower-priced ad-supported SVOD option after 10+ years of brushing off advertising, is undoubtedly researching the idea (among many others) with no clear business model planned at the moment, if at all. A Netflix representative wasn’t immediately available for comment.
Wedbush Securities media analyst Michael Pachter believes Netflix will pass on the concept.
“I don’t think it’s likely at all, way too confusing to consumers,” Pachter said. “If they decide to do that, they would have to rebrand under a different name (like FreeTV). I don’t see them confusing people who log onto Netflix and can’t find ‘Stranger Things.'”
To Farhad Massoudi, who founded San Francisco-based Tubi as a video advertising platform in 2011, the FAST/AVOD market is reaching its potential.
“We’ve been collecting data for a decade on viewership of titles and audience segmentation,” Massoudi said in a media interview. “And once we figure out what the user is interested in, then we can serve them hundreds of hours of content that’s similar.”
Tubi, like other AVOD platforms, is expanding content offerings to include next-day access to Fox Entertainment programming such as “The Masked Singer” competition show, while moving into original content as well.
The platform’s recently inked WBD content licensing pact includes myriad catalog shows such as “Westworld,” Raised by Wolves,” “Legendary,” “F-Boy Island,” “The Nevers,” “Finding Magic Mike,” “Head of the Class” and “The Time Traveler’s Wife,” among others.
“Our new WB branded FAST channels and on-demand offering will speak to each of Tubi’s distinct audience communities,” said Adam Lewinson, Tubi’s chief content officer.
One thought on “Warner Bros. Discovery, Netflix Kicking FAST/AVOD Service Tires”
If I want to watch five ads every 5 mins.
I will watch over the air TV. But there is not
#@^%$ on worth watching.
But I have more DVD’s. Laser Disc. VHS tapes.
And a few streaming things. I can watch something new
every night for years on end.