Could AVOD and FAST New Subscriptions Surpass SVOD by the End of 2023?

By: Jerry Inman|August 7, 2023

As we venture into the ever-evolving world of streaming, the battle between Advertising-based Video On Demand (AVOD), Free Ad-Support Television (FAST) and Subscription Video On Demand (SVOD) platforms has intensified.

While SVOD services like Netflix, Hulu, and Amazon Prime have long dominated the streaming landscape, a compelling case can be made for AVOD platforms taking center stage this year. Let’s explore why I think AVOD is set to gain more than 3X new viewers than SVOD this year — and what it means for the future of streaming entertainment.

The Power of Free and Easy Content
One of the primary factors contributing to the projected surge in AVOD/FAST viewership is the allure of free content. Consumers — especially younger generations — have become more cost-conscious in recent years, and the appeal of accessing a wide array of movies, TV shows, and other content without the burden of subscription fees is hard to ignore. AVOD platforms capitalize on this trend by offering ad-supported content, allowing viewers to enjoy their favorite shows without having to open their wallets.

The FAST offer is unique because it includes linear, scheduled programming, unlike AVOD services. This is a big plus for many viewers, who still enjoy cable television’s “always on” experience and don’t want to make major content viewing decisions. There are clear signs FAST is gaining real traction among viewers, too. A recent Whip Media survey – fielded to 2,011 American TV viewers in July – found that nearly half of respondents who were familiar with free streaming said they watched FAST channels at least a few times per month. And perhaps an even better indicator of FAST’s growth: 78% of FAST viewers said they are watching the same amount of FAST content or more this year when compared to 2022.

Some of that success, undoubtedly, is tied to FAST content being free – especially at a time when TV viewers are seeing their streaming bills increase seemingly every few months. But the key factor that attracts viewers to FAST platforms, according to Whip Media’s recent survey data, is “programming”; nearly 80% of respondents said they watched FAST channels that had shows or movies they enjoyed. The most popular FAST genres in the U.S. are action and comedy movies, according to Whip Media’s viewer data, as well as reruns of hit TV shows.

Diverse and Premium Content Selection
In the past, AVOD/FAST platforms were often associated with limited and outdated content. However, the tables have turned. In 2023, AVOD services have secured strategic partnerships and licensing deals with major studios, making their content libraries more diverse and competitive. This includes partnerships with content creators, independent filmmakers, and even exclusive releases. As a result, AVOD platforms have succeeded in closing the content gap with their SVOD counterparts.

Targeted Advertising and Personalization
Another aspect that favors AVOD/FAST platforms is their ability to leverage advanced data analytics and user profiling to deliver highly targeted ads. Unlike traditional television ads that may not be relevant to all viewers, AVOD/FAST platforms can tailor advertisements based on users’ preferences and interests. This personalized advertising approach leads to higher engagement rates and better ad relevance, resulting in a more enjoyable viewing experience for consumers.

Access to More Content and Lower Barrier to Entry for Content Creators
As popularity for AVOD/FAST gains momentum, new opportunities for content creators, who might have found it challenging to break into the exclusive world of SVOD platforms, are now open. AVOD allows them to reach a broader audience without the constraints of subscription fees. As a result, we are witnessing a steady influx of fresh and innovative content, catering to niche audiences that may have been overlooked in traditional broadcasting or premium streaming platforms.

Global Accessibility and Localization
AVOD/FAST platforms have also made significant strides in reaching global audiences and offering content in multiple languages. AI has enabled automated subtitling and dubbing of international content, reducing costs through real-time translation, voice synthesis, and efficient post-production, making entertainment accessible to global audiences economically. AVOD/FAST services can attract a broader range of viewers from different regions and cultures. This localized approach allows AVOD platforms to tap into international markets effectively, expanding their viewer base far beyond SVOD’s traditional model.

Enhanced User Experience
User experience has emerged as a key differentiator in the streaming industry. AVOD/FAST platforms have recognized this and have invested heavily in creating a seamless and enjoyable user interface. By striking the right balance between ads and content, AVOD/FAST services have managed to improve viewer retention and satisfaction, boosting their potential for growth this year and beyond.

While SVOD platforms have long been the giants of the streaming industry, 2023 marks a turning point. AVOD/FAST is positioned to gain more than 3x the viewership of SVOD this year, driven by its attractive advantages, such as free content, diverse selections, targeted advertising, and enhanced user experience. As AVOD/FAST platforms continue to evolve and innovate, it is evident that they are redefining the way we consume content, making streaming entertainment accessible to a broader audience worldwide.

However, it is important to note that the streaming landscape is highly competitive and subject to rapid changes. Both AVOD/FAST and SVOD platforms will continue to adapt and respond to consumer demands, and the battle for viewership supremacy will remain fierce. According to Statista the number of AVOD/FAST users is expected to amount to 3.44B users by 2027. Only time will tell which model will ultimately dominate the streaming industry. But for now, AVOD/FAST’’s momentum suggests that it is a force to be reckoned with in 2023.