Think FAST: Streaming experts told TheWrap they expect that the looming recession will cause the streaming industry to merge even more quickly into the new lane where it’s already heading: Free ad-supported streaming television — FAST for short. The list of FAST networks includes such entities as Pluto, Tubi and Amazon’s Freevee.
As premium subscription streaming services scramble to expand to ad-supported tiers to offset the loss of subscribers and slower-than-predicted growth (hello, Netflix and Disney+), industry players and dealmakers observe that FAST — long stereotyped as a haven for a financially struggling Gen Z audience to enjoy dusty network reruns for free — is poised to integrate access to premium content into their mix without the hefty price tag.
In fact, Comcast Advertising just released a report showing FAST use has more than doubled year over year in 2021 — from 8% to 18%. And that six out of 10 households with connected TVs or Smart TVs (traditional TV sets with integrated Internet and interactive web features) have turned to FAST services solely or in combination with other streaming services.
On a WraPRO Roundtable panel on FAST, Erick Opeka, chief strategy officer of Cinedigm entertainment company, said that rapidly decreasing prices for Smart TVs are not only bringing more viewers back to the home screen, but also making free streaming content part of the bundle when you purchase the device.
“You’re getting this incredibly easy-to-use system… You can browse around and consume it the same way you did cable. I think that really that has been the biggest driver of why FAST is growing so rapidly,” Opeka said. “We’ve seen our revenues in that space grow about 340% over the last 36 months. So I think all of those factors combined have made this probably one of the most exciting and certainly the fastest growth that I’ve seen out of a vertical it’s happened since I’ve been in the business.”
Opeka added, however, that it’s important for FAST to integrate itself into the viewing habits of consumers who may also be using other platforms, including subscription-based services.
Rose Hulse, founder and CEO of ScreenHits TV, an aggregation platform for both subscription and FAST channels, agreed, saying that advertising may be tolerable for some types of show but not for others.
“I think that we, as content viewers have intrinsically changed because of the Netflix-type model. We like to watch what we want when we want to watch it,” Hulse said. “However, that doesn’t mean that there isn’t an audience for FAST because we can see the success that Pluto has had, and other companies… And so it’s how do we integrate the two worlds together? I would watch Bloomberg with ads, but I wouldn’t watch [Netflix’s miniseries] ‘Elizabeth’ with ads.”
Anjali Midha, CEO and co-founder of Diesel Labs, a content intelligence company that measures audience attention, said her company’s data indicates that viewers are attracted by the best content, rather than the platform, and younger viewers with less cash on hand may be more tolerant of ads than their parents.
“I think frankly, it’s ultimately it’s all about the content,” Midha said. “If I don’t have the privilege to have enough disposable income to watch my shows without the ads, am I going to tolerate the advertising or do it with the advertising? I think, probably, especially for younger generations. When everyone is talking about something, you want to be a part of that conversation.”
From the perspective of being a part of streaming deals, attorney Martin said recent investors have been “spooked” by the Netflix downturn, but added it’s more a course correction in streaming that perhaps opens the door to further growth in FAST.
“When Netflix announced that they’d lost subscribers, that was less an indictment of streaming as a means for delivering content and more so the natural outcome of all these additional entrants into the marketplace,” Martin said, adding, “I’m sure that there are platforms, there are innovations and things of that nature that we can’t even anticipate that will emerge over the course of this impending recession.”
And when it comes to advertising, joked Martin, FAST offers the chance for a fast nature call. “I think people do what they’ve always done when ads come on — they go to the bathroom,” he said.
To view the full panel discussion click on the video above.
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