A quarter of US internet users now rely on a mix of Advertising-funded Video on Demand (AVOD) and Subscription Video on Demand (SVOD) services for their entertainment, according to the latest research from Ampere Analysis. This represents an increase from the 15% reported in Q1 2020.
The analysts’ catalogue research finds the quality and popularity of SVOD services is typically driven by their exclusive titles whereas AVOD services tend to rely on high volumes of non-exclusive content from major studios to bolster their quality perception of their catalogues.
Ampere reports AVOD viewers tend to be older and less affluent than their SVOD counterparts and tend not to stack multiple SVOD services, preferring traditional pay-TV packages. In the study, older users (age 55-64 years old) were the fastest growing age bracket of AVOD viewers, with a 7-percentage point increase in AVOD uptake among the group in the last year alone. This was also the fastest growing age bracket for SVOD but due to the greater maturity of the SVOD market, saw just a 3.5 percentage point growth in the last year.
Ampere Analyst Tom Bell says: “We can see the appeal with older audiences at present, but AVOD services will need to compete more directly with the content on SVOD if they want to attract the younger, more affluent audience already familiar with SVOD.”
While US AVOD catalogues are large, they’re primarily made up of older, non-exclusive titles. In contrast, SVOD services typically reply on a catalogue of exclusive titles to increase the quality and popularity of their content offering.
Bell adds that as the studios increasingly reserve a proportion of their content for their own platforms, the AVOD platforms are following suit, and commissioning their own shows. Among them Roku, Vudu, Crackle and IMDb TV have all begun to commission original programming with an emphasis on the easier to produce comedy and documentaries.