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Exclusivity “key to AVOD growth”

April 20, 2022 11.22 Europe/London By Chris Dziadul

Major AVOD platforms have joined the original content goldrush, with groups such as Roku, Tubi and IMDb TV collectively releasing over 100 brand new original titles in the last two years.

A new report from Ampere Analysis also finds that the US AVOD services with the highest investment in original content have seen the largest growth in usage. Tubi, which has launched 20 original titles, saw monthly usage grow by 164%, by Ampere’s estimates, between Q3 2020 and Q3 2021.

Ampere adds that the increasing investment in original content mirrors the moves from subscription streamers, allowing providers to add exclusive content to their catalogues amidst a backdrop of a shrinking pool of licensable content as the major studios bring content in-house for their SVOD services. And catalogue exclusivity has proved crucial in such a competitive market, with AVOD services with higher volumes of exclusive content benefiting from greater usage.

Ampere notes that AVOD platforms can’t match the billions of dollars spent by the leading SVOD players in the creation of original content. They are smaller in scale, and the advertising business model will struggle to justify the sorts of multimillion dollars per-hour content investments which the leading SVOD players have applied to new flagship titles. However, according to Ampere’s analysts, one fundamental calculation for investing in original content remains true for both service types: as platforms expand globally, original content investments scale well. Investing in originals is a consistent way to offer exclusive content worldwide without incurring additional licensing costs in each market.

Additionally, while AVOD originals do not yet provide enough of a draw to pull viewers away from larger SVOD platforms entirely, they do differentiate services within the increasingly fragmented AVOD market, and offer a reason for viewers to choose one service over another.

Ampere also says that in the early stages of original programming, strategies between AVOD platforms vary. Roku has invested more extensively in original-branded content, in part because of its acquisitions of Quibi’s content assets and its focus on low-cost-per-hour content. Of the six most popular AVOD platforms in the USA, Pluto TV is the only one not to have invested meaningfully in original programming – although it is in a position to take advantage of the programming slate of its parent company – Paramount – and outside the US has become the temporary home for hit Paramount originals such as Star Trek: Discovery.

Commenting on the findings of the report, Joseph Hall, analyst at Ampere Analysis, sais: “Despite AVOD originals not having an impact in the wider streaming market – largely limited by their current lack of reach –AVOD platforms should not stop their investment. Our analysis shows that the AVOD platforms with the highest growth in use since Q3 2020 are those with the most released or announced original programming”.

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Filed Under: Newsline, On Demand/VOD, Platforms, Research Edited: 20 April 2022 11:22

About Chris Dziadul

Chris is our Central & East Europe Editor. You can talk to Chris on Twitter @chrisdziadul or by email at cdziadul@broadbandtvnews.com

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