| It’s been well over 10 years since the guys at Pluto and Tubi came up with the idea of free ad-supported streaming television, close to seven years since some guy in New Jersey realized that spelled out “FAST” and gave it a name. But the segment, once the hottest thing in television, is at a crossroads these days as consumers struggle with discovery and publishers struggle with unfilled inventory. That’s more a sign of a maturing industry that needs some shaking up and paring down, rather than a category that is in its death throes, but it’s well worth looking at what is going on with FAST and why it needs some TLC. Why It Matters Amazon and Hulu aside, ad-supported SVOD is still struggling to gain traction, at least in the US. That means the bulk of the inventory on streaming is still on various FAST services. This is notable in that the vast majority of ads viewed in the US are still on linear. This is not as insane as it sounds: almost all linear is ad-supported, only around half of all streaming is. And ad breaks on linear are much, much longer than on streaming. Hence the imbalance. There are a number of issues that FASTs—and the people who love them—need to figure out. What Are They: There is much confusion as to what “FAST” actually refers to. There are the services themselves—the aggregators who control the interface and are responsible for curating all the programming. So everyone from Pluto and Tubi to The Roku Channel, LG Channels, Samsung TV Plus and VIZIO WatchFree+. Then there are what people have taken to calling “FAST Channels”—all the linear channels on those FAST services. Which now also have lots of on-demand options—Tubi in particular, where 90% of what’s watched is on-demand. Meaning it’s often hard to understand what people are referring to when they talk about “FAST.” Where Are They: While consumers don’t really use terms like FAST, they’re aware that there are free ad-supported services and channels and on demand and that there is little consistency between any of them which makes discovery difficult, re-discovery almost impossible. (“Re-discovery” = “I was watching this great channel with Welcome Back, Kotter reruns on it, but when I went to tell my friend, I couldn’t figure out where it was.”) Low Fill Rates: We hear about this problem a lot—that so much CTV inventory—FAST in particular—goes unfilled, and it’s because there are a whole lot of FAST channels and FAST on-demand libraries that get about two viewers a week and thus have almost no advertisers and others that get tens of thousands and plenty of advertisers and despite the very low CPMs on the former, many are not attracting advertisers because there is way more low grade volume than people looking for low-grade volume. Lack of Transparency: This hits both advertisers and publishers. The advertisers have no idea where their ads ran other than (maybe) “on a crime drama last week” while publishers (the people who own the content) have little to no visibility as to how many people are watching their shows, where they come from, which shows are most popular. For both parties, the lack of transparency makes it hard to know what’s working in a way that just breeds discouragement and distrust. Uncertainty: A big theme this year for sure, but there’s a sense that the FAST services are going to continue to cull underperforming programming, that ad rates will continue to fluctuate and that no one will really fully understand why, because the people who might provide the answers have no interest in providing them. Europe: As you have no doubt gleaned from our Marconi newsletter, FAST is a different beast in Europe. Mostly because there are a number of public broadcasters who can offer free streaming content, meaning the demand for free content is much different than it is in America, free ad-supported content in particular. What You Need To Do About It The solution, at least to this Jerseyite, would seem to lie with two seemingly diametrically opposing concepts: standardization and personalization. Allow me to explain. Standardization would mean that the major FAST services all had a core group of linear channels and on-demand libraries that were the same from service to service. This would then allow advertisers to buy categories across all of the main services creating something like economies of scale while also offering the sort of reach that advertisers love about TV. It would, conceivably lead to greater transparency as the need for each platform to be less than open about their particular stats would not be as great. At the same time, personalization would allow for the creation of something like Spotify’s Daily Mix playlists, only for TV, which could be organized by category and would mean those Welcome Back, Kotter episodes would never get lost again. (That this is something I predicted would happen in my book, Over The Top: How The Internet Is Slowly But Surely Changing The Television Industry back in 2015, plays no small part in this suggestion. I still think it’s a great idea.) Personalized channels/playlists would also be great for advertisers who could target viewers with Instagram-like precision, a boon for the small and medium businesses who will soon be making greater use of CTV and FAST. They are, as noted, diametrically opposed ideas, but more standardization would help advertisers while more personalization would help everyone by making TV feel more like Instagram, YouTube and TikTok, while also opening up ad opportunities, shoppable ones in particular. That is what’s going on with FASTs in a nutshell—we will be doing deeper dives over the course of the year, including an updated special report. Watch for it. |
