As would be expected in a situation where consumers in the United States were forced into self-quarantine, television consumption, particularly streaming, went through the roof earlier this year as the pandemic took hold. But while much of the streaming discussion focused on high-profile SVOD content, ad-supported video on demand continued to expand its foothold, according to Nielsen.
Known by an array of acronyms, such as AVOD, FAST (free ad-supported TV) and CTV (connected TV), these streaming varieties offer cost-conscious consumers yet another option to add to their viewing choices. As many are affiliated with large media conglomerates, they give them the ability to offer content in an increasingly popular way while facilitating targeted, dynamic ad insertions.
Comparatively, many traditional media consumption trends, such as linear TV viewing and traditional AM/FM radio tune-in, are nearly back to seasonally normalized levels. According to Nielsen’s Streaming Meter data, Americans age 2 and older spent more than 123 billion minutes streaming video content the week of July 20, 2020 (well after much of the U.S. had reopened). That’s up more than 33% from the 92.3 billion minutes streamed the week of July 22, 2019. Streaming also now accounts for one-fourth of total TV usage among streaming-capable homes, which is up from 16% a year ago.
Within the United States’ streaming universe, the “other” players—everything other than Netflix, Hulu, YouTube, Amazon Prime Video and Disney+—account for 23% of the streaming pie. The amount of time viewers spent watching “other” content in second-quarter 2020 increased more than 57% year-over-year, accounting for more than 12 billion minutes.
Importantly, the streaming environment has grown well beyond VOD options, and most streaming platforms and content providers are built on ad-supported business models (although some have tiered their offerings to include both ad-supported and ad-free programming). Today, the OTT streaming world includes: ad-supported video on demand (AVOD) content; and virtual multichannel video programming distributor (vMVPD) content.
Platform and service nuances aside, one attribute unites the content in the AVOD and vMVPD space: advertising. That’s the important part, particularly because digital ad spend is rising. And while global ad spend will dip this year, the February 2020 Nielsen Total Audience report forecasts that digital media spend should top $500 billion globally by 2023. That’s just $100 billion shy of last year’s total global ad spend (approximately $600 billion).
Currently, MVPDs, vMVPDs and AVOD services account for the slight majority of share (just under 60%) within the less-discussed realm in the streaming space. Gaming accounts for approximately 10%, and the rest includes a mix of network offerings, social platforms, SVOD platforms and other measured options.
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