Free Ad-Supported TV Streaming Soars: 1 in 3 US Users Opt for Services Like Tubi, Crackle

Free ad-supported streaming (FAST) services are booming as customers try to cut down on their entertainment costs, with platforms like Freevee, Pluto TV, Tubi, the Roku Channel, and Crackle gaining popularity.

Samba TV's most recent State of Viewership survey indicated that one in three Americans now subscribes to these reasonably priced streaming services, according to a TechCrunch report.

Notably, Amazon's Freevee took the lead in the first half of 2023, registering a stunning 11% increase in viewers year over year. Amazon has added several Amazon Original titles from Prime Video to Freevee to target the FAST market. Additionally, the platform debuted 23 brand-new ad-supported TV channels in association with Warner Bros., Discovery, and MGM.

FAST Users Increase as SVOD's Appeal Drops

Other FAST market participants have also made significant advances. The viewership of Pluto TV and Tubi increased by 7% and 6% respectively, while Crackle and the Roku Channel both witnessed a 5% rise. Fox-owned Tubi recently celebrated a 79% increase in overall usage, highlighting the rising desire among viewers for free, ad-supported streaming services.

In comparison to subscription video-on-demand (SVOD) streamers, numerous major platforms reported declines. Netflix dropped 1% and Peacock 2% year-over-year. Even Prime Video, Freevee's sister streaming service, had a slight 3% increase in viewers during that time.

Compared to conventional SVOD providers, the attractiveness of less expensive ad-supported streaming options is growing. In 2023, a fifth of premium streaming users will choose ad-supported subscriptions, according to Samba TV's study. Notably, 60% of Americans said they would be open to signing up for a reduced streaming service that included advertisements.

Following the launch of ad-supported plans by Netflix and Disney+ less than a year ago, there has been a move toward ad-supported business models. According to the survey, 85% of participants who were subscribers to these streaming platforms quickly adopted the new business strategy.

During its first Upfront presentation, Netflix toasted the success of its ad-supported tier by announcing that as of May 2023, the plan had almost 5 million worldwide monthly active subscribers. Notably, Antenna claimed that 17% to 20% of new Netflix sign-ups chose the ad-supported tier during the current year's second quarter.

Viewers Want to Save Money

The increasing appeal of free ad-supported TV streaming services is due to their economics. Streaming users worry about overpaying, contributing to a rise in cancellations. According to recent polls, 59% of users are prepared to put up with advertisements in return for financial savings or free access to content.

FAST is becoming more popular at the same time that industry heavyweight Netflix is having trouble growing its member base as a result of intensifying competition. Traditional cable TV bundles are also losing consumers fast as viewers are creating their own entertainment bundles by mixing paid and free options.

Ad-supported streaming service executives stress the importance of user engagement. Chief Content Officer of Tubi, Adam Lewinson, emphasized that interaction generates money by pointing out that their ad-supported strategy depends purely on viewers' content consumption, per The Verge. Scott Reich, SVP of Content at Pluto TV, agrees and emphasizes the need to give viewers strong incentives to return to the network.

These free ad-supported streaming services are expanding their content offerings beyond their original cheap-based programming thanks to the financial assistance of industry titans and the help of advertising income, per Wall Street Journal. Many sites have switched to conventional licensing negotiations to obtain more current and high-profile content and broaden their appeal.