According to the latest data reported by eMarketer, users of advertising-supported video on demand (AVOD for Advertising Video on Demand), will represent 58.2% of all users of OTT services by the end of the year 2022 .
This trend is partly explained by the fact that traditional pay SVOD services are in the process of preparing hybrid offers in order to offer American consumers lower prices. The two most anticipated services by the end of 2022 are Netflix and Disney+.
140 million users
The number of AVOD viewers in the US will grow 8.6% year over year to reach more than 140 million in 2022, according to the latest eMarketer forecast from Insider Intelligence. Even though eMarketing points out that the growth rate of AVOD users is decreasing year-on-year from 30.3% in 2020 to 17.7% in 2021, the number of AVOD users will be 54 .3% of all video viewers in the United States at the end of 2022. In 2025, eMarketing predicts there will be 165.4 million US AVOD users, or 61.2% of all streaming video users .
Multiplication of services
The US streaming market has long viewed AVOD, and then FAST channels, as a distribution channel in its own right. On the one hand, there are pure AVOD services, such as PlutoTV (Paramount), FreeVee (Amazon), Tubi (Comcast), Xumo (Fox), Roku, and on the other hybrid services which offer premium offers without advertising and standard offers with advertising: Peacock (Universal) or Hulu (Disney) are the best illustration of this. Not to mention HBO Max: In 2020, HBO, which was notorious for its aversion to advertising, opened the first breach in the barrier between “prestige” broadcasters and advertisers by launching an ad-supported subscription for HBO Max.
Netflix signs with Microsoft
Since then, the two paid SVOD giants have been hard at work preparing for the launch of their offer with advertising: Disney+ and Netflix. It must be said that the advertising prospects seem attractive for these two services which have hundreds of millions of subscribers between them. Recently, the Wall Street Journal reported a $60 CPM for Disney+. Enough to make streamers’ financial directors salivate. Disney has chosen The Trade Desk to develop its new service, while Netflix has just announced a partnership with Microsoft.
1500 FAST channels
The US market today offers nearly 1,500 FAST channels with advertising revenue estimated at $4 billion by Variety for 2022. At the same time, and according to Comscore, AVOD services are being adopted at a faster rate than SVOD, with a 29% increase in American households watching AVOD programs via streaming in 2022 compared to 2020, compared to a 21% increase during the same period for SVOD.
It’s not so much the interest of the programs as their freeness that motivates American consumers according to James Muldrow of Comscore: “As ad-supported and subscription-based streaming services grow in the United States, we’re seeing consumers pay more attention to their budget and lean into ad-supported services. This makes sense, as inflation continues to weigh on consumers’ wallets. »