Free streaming’s audience will grow larger than paid streaming in 2022, according to the study “The Stream: 2022 Audience Insights for Brands” from the Fox-owned free streaming service Tubi, aimed to understand better streamers’ preferences, habits, and perspectives on the state of streaming today.
According to the report, in 2021, SVOD audiences grew 8% year-over-year, while AVOD grew twice as fast at 16%. This trend will likely continue and close the approximately 5% gap between AVOD and SVOD market penetration, surpassing SVOD in early 2022. Furthermore, AVOD adoption will continue to grow, thanks to ubiquitous hardware, cord-cutting, subscription fatigue, and increased broadband access.
Tubi also noted that free streaming platforms would differentiate loyal audiences while maintaining audience overlap with SVOD. Therefore, streamers will gravitate to select AVOD platforms. “At Tubi, we are seeing that year over year, the majority of Tubi streamers cannot be reached on other AVOD — whether due to key differentiators in content offerings and personalization or just the paradox of choice in a crowded app marketplace. Currently, more than a quarter (27%) of Tubi streamers can not be reached on any other major free AVOD services,” the report says.
Tubi considers that free streaming will expand to older and higher-income users. Just as streaming has become more popular across all age groups, free streaming follows suit. AVOD adoption was led by the young (who still over-index vs. gen pop), and now mature, educated, and affluent audiences are catching up.
Streaming, in general, will become the fastest-growing video format, both in viewership and media investment. Connected TV and over-the-top (CTV/OTT) ad spend grew 34% in 2021 and 7.4% for national broadcast and cable. Streamlining is currently the fastest-growing long-form video platform in terms of ad investment. In fact, in 2022, it is forecasted to become the fastest-growing video ad platform. By 2026, AVOD revenues are set to nearly triple the 2021 levels, reaching $31.4 billion.
Lastly, the study discovered that streamers are becoming more receptive to ads and are becoming more familiar with AVOD platforms. “Tubi has one of the lightest ad loads in the AVOD space: only 4-6 minutes per hour of viewing. This gives advertisers increased brand recognition and recall in an environment where viewers are most receptive. Compared to traditional TV, with an ad load of 13-17 minutes every hour, AVOD makes for a smoother viewing experience. Clearly, this is resonating with Tubi users, which are 10% more likely than Gen Pop to state, ‘I like to look at advertising,’” the report concluded.
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