Anti Netflix: "Free" video distribution service with advertisement expands | Digiday [Japanese version]

Subscription services may dominate today's online video market, but ad-supported free platforms are finding ways to reach people watching on connected TVs. This growth is proving to be an opportunity for video programmers looking to stream on the biggest screens in their homes.

Roku Channel, a free video streaming service from connected TV device makers with movies, TV shows, and 24-hour linear channels from several digital publishers, is now Roku when it comes to reach. The company says it's the fifth most popular app. Roku didn't disclose how many viewers it has on its channel, but Roku's platform as a whole had 20.8 million registered users at the end of June.

Besides Roku, other free video streaming services have also managed to build audiences on connected TV screens. Pluto TV currently has about 10 million monthly active users. Xumo said it had 3.5 million monthly active users at the end of July, with viewership up 325% over the past year.

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And then there's Amazon. The company is reportedly working on an ad-supported free distribution app that will offer movies, TV shows and other shows for Fire TV users.

The growth of these services is a result of the rapid increase in purchases of connected TV devices such as streaming dongles and boxes, game consoles and web-enabled smart TVs. According to a recent eMarketer forecast, 88.7 million American households have connected TVs, or 71.6% of all households.

Price-Sensitive Consumers

However, some people say it's the people who watch the streamed videos on TV sets that are actually driving the growth of free-to-play streaming services. It's not just that there's an increase in .

"If you sign up for Netflix, Amazon, and even Hulu, you're going to be paying $30 or more. Price-conscious consumers are tempted to pay for free streaming services." We see it as an alternative or a complement, and that's probably the biggest factor," said Colin Petrie Norris, CEO of Xumo.

The expansion of these services is also fueled by the fact that some free video streaming services are being integrated into smart TVs made by manufacturers like Samsung, Vizio, or LG. Is receiving. Xumo claims an installed base of about 17 million TV sets in the US is available with TV sets from Samsung, Sharp, Hisense and Vizio. Xumo is working with Hisense to incorporate its own "input" into the TV set, Petrie Norris said. Xumo has placed the Xumo button next to Netflix on the remote control for some Vizio TV sets. Xumo has also white-labeled its services with LG.

Working with TV Makers

Meanwhile, Pluto TV, which is primarily available as an app, is looking to incorporate a more channel guide-focused service into TV sets than ever before. The company recently struck a deal with Visio to program TV makers' free-to-view services and a deal with Samsung to provide programming for the Samsung TV Plus app.

Petrie Norris said these services are attractive to TV makers because they will receive recurring revenue in the form of advertising revenue share. "You can't sell TVs and make 50% profit. Profit share is an attractive model for TV makers because it will bring long-term profits as customers use these services for years. No cost," said Petrie Norris.

Video producers are sticking with these services, driven by TV makers' ambitions to grow audiences and revenues. Roku Channel's library also includes classic movies and TV shows from well-known studios, as well as several linear channels by digital programmers such as ABC News, Cheddar and Newsy. there is Pluto TV and Xumo's programming partners reportedly include CBSN, People TV, Cheddar, Newzee and Tastemade.

An Opportunity to Earn Additional Revenue

For New Zealand, distribution on Roku Channel is attractive. Because NewG also operates its own streaming app on Roku, which is simply the largest platform in terms of streamed video consumption. Partnering with Roku, which offers the opportunity to program one of four 24-hour linear channels on Roku Channel, has the potential to expand additional distribution on the platform and potentially reach new audiences. It was convincing.

“Roku is pushing hard to grow the Roku channel into a key part of their ecosystem,” said Blake Sabatinelli, CEO of NewZee. "Being one of a handful of options and being located next to ABC News is very convenient and something we should consider."

Free video streaming offers publishers some additional revenue opportunities. Pluto TV has been a revenue driver for several of its channel programmers, according to previous reports from Digiday. Through Amazon's Prime Video Direct program, Xumo generates ad revenue comparable to what Amazon pays publishers to upload videos for the time they consume, according to Petrie Norris. .

Another attraction

Another attraction of free video streaming services is that they don't intend to order original content. This means publishers can reuse existing video series and clips extensively to generate additional revenue without expending additional resources.

"We're going to let our fate take hold and distribute our content everywhere, but we need to be careful about how we weigh our investment against the revenue we get from all these platforms," ​​said an insider. (Insider) CRO Pete Spande said.

Insider plans to launch its own OTT offering on Insider TV, available as an app for Roku, Amazon Fire TV, and Apple TV. The publisher is also working with Roku to stream videos on the Roku channel. The company is also considering Pluto TV and Xumo.

"Our current commitment is to make it available on all platforms where people want to discover us and connect with the brand. That's our number one concern." Spande said.

Sahil Patel