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Ad-supported streaming services like Tubi are booming as Netflix struggles with subscripturation

Wednesday, May 4, 2022 by Robinhood Snacks |

Two-minute bathroom break… TV commercials are back in style. This week, ad-supported streaming platform Tubi said it had doubled its active viewers since 2020, and planned to launch 100 original shows and movies this year. Meanwhile, Netflix, the world’s most popular subscription streamer, is struggling with its slowest growth in years.

  • The price is right: Unlike Netflix, which starts at $10/month, Fox-owned Tubi is free with ads. It’s available on smart TVs and devices like Roku.
  • Quantity over quality: Tubi has the largest catalog of on-demand streaming content: 20K old movies and shows. Think: no Marvel flicks (those are on Disney+) but both the 1943 and the 1966 versions of “Batman.”

Streaming is changing FAST… Blame #subscripturation. As viewers get sick of paying $38/month to watch “Euphoria,” “Bridgerton,” “Severance,” and “Loki” on four different platforms, some cord-cutters are now becoming subscription-slashers: last quarter, Netflix reported its first loss of subs since 2011. Meanwhile, free ad-supported streaming TV (FAST) options are growing:

  • Not just Tubi: Ad-powered streamers Freevee (owned by Amazon), Pluto (owned by Paramount), and the Roku Channel have 50M+ active viewers apiece.
  • Ads = not just a fad: By the end of the year, ad-supported streaming is expected to have more viewers than subscription-based streaming.
THE TAKEAWAY

Ad streaming has something for everyone… Consumers love the price, advertisers love the targetability, and OG media companies like Fox love the back door into the streaming race. Subscripturation could drive viewers from pricey subscriptions to ad-filled alternatives. That may mean more competition for the Tubis of the world: Disney+ plans to launch an ad-supported tier this year and Netflix is considering doing the same.