OpinionITV’s new streaming service comes when the UK AVOD market is ripe for more competition. But the broadcaster needs to answer two important questions.
Connected TV has to change if itโs to compete with linear TV. CTV audience volumes are still dominated by the big, non-ad funded, SVOD streaming services.
However, the announcement of the autumn launch of ITVโs ITVX streaming platform is set be the catalyst for a growing advertiser-funded video-on-demand (AVOD) marketย in the UK.
Frankly, the UK market is ripe for a superior AVOD platform which can compete with the likes of Amazon Prime Video and Netflix. Consumers have made it clear they are willing to watch ad-funded streaming platforms as long as they have access to premium content.
According to a 2021 Mintel report, 50% of TV viewers would prefer to watch an ad-supported TV streaming service, and Comcast recently reported that 80% of consumers would preferย an ad-supported service over a higher cost SVOD service.
A growing and healthy AVOD market is right for both consumers and advertisers. In lockdown we were all addicted to subscription VOD (SVOD) TV.
Netflix and Amazon Prime enjoyed subscription increases of 17% and 29.5% respectively in 2020 (BARB/Mintel Q1 vs Q3). And while there will always be demand for premium ad-free streaming services, the trend for platform โstackingโ has definitely peaked.
The rising cost of living, potential surcharging for password sharing and investment pressures โ ย which may hamper the production of quality new content โ ย all add up to consumers reviewing their current choices and invariably looking to reduce household costs.
And itโs not just the ITVX announcement that is pointing towards the growth of AVOD. A few weeks ago Disney announced that it is introducing an ad-supported plan for its streaming service Disney+ as part of its goal to reach 260 million subscribers by 2024. And then straight afterwards, Netflix announced that both…