Sri Hari Thirunavukkarasu, SVP sales, EMEA, Amagi, discusses the growing adoption of advertising-supported models by the major streaming services, as well as how traditional European broadcast platforms are adopting FAST services to attract more viewers than ever.
What industry trends have particularly stood out for you in 2023, and why?
One big trend we’ve seen this year is the continued expansion and momentum behind streaming services that use ad-supported models. We are seeing the growing popularity of this model in the viewership numbers as well. It’s worth noting that despite economic uncertainties and media companies becoming somewhat conservative with their spending, they’re still focusing on innovative business models and viewer experiences that set them up for an OTT/streaming-dominated future. Particularly, there’s a lot of buzz around FAST services, with major content owners in primary EU markets jumping into the game. We are also seeing traditional broadcast platforms considering adding FAST services to their bouquet of channels, much like Virgin Media in August 2023. And, of course, beyond streaming, there’s the increased use of cloud technology for various broadcast TV applications, which is helping broadcasters be more adaptable, cost-efficient, and better at reaching viewers on all sorts of devices and platforms.
What impact are you seeing those trends having on the media and entertainment industry?
These trends are changing how people access and enjoy content. With more content available on streaming platforms and more viewers embracing ad-supported experiences, we have seen a significant increase in CTV advertising spend year over year. The industry at large — content providers, streaming services, and advertisers — is becoming quite successful and seeing returns from this evolving landscape.
How do you see those trends developing further in 2024?
We can expect streaming to continue in various forms, from SVoD and AVoD to linear channels and FAST, with advertising showing more promise and growth than subscription-based models. As a result, traditional broadcasters and pay TV Platforms, which rely primarily on subscription revenues, are likely to launch more FAST services. Large content owners will likely keep enhancing their D2C offerings, much like ITV with their AVoD platform, ITVX. As the quality of content and ad experiences on streaming platforms get even better, we can count on more viewers tuning in and higher advertising revenues, thanks to that “network effect.”
Do you expect to see any new trends within the industry in 2024, and what will they be?
One potential game-changer we may see in the next year is the proliferation of live events as a way to differentiate among streaming services. Exclusive live content could be the key to attracting and retaining subscribers, who will be interested in other offerings. Also, advertising in the streaming world is likely to evolve with new ad unit formats aimed at increasing ad revenue through better fill rates and CPMs. This could lead to more effective monetization of streaming services and the acceleration of ad-spend shift from traditional TV to CTV, benefiting both content providers and advertisers.
