We have been writing about the rise in AVOD popularity in several of our Chunks blog posts in the past year. Due to Covid there was increase in both new OTT services offered as well as number of new connected households and connected devices. As a result, there was an increase in services stacking (predominately SVOD) and many reached their maximum off 3 or 4 services that they were willing to pay for each month.
As predicted, along the SVOD there was a rise in consumption of AVOD OTT services. Consumers were unwilling to pay for additional OTT services but did not mind free services with ads in them. Covid was an extra push but other contributing factor in AVOD popularity was advances in ad supported market. More and more content owners are grouping their activities and efforts in order to gain a stronger foothold when competing with Netflix, Amazon Prime, and as of recently Disney+. On the other hand, with saturation of subscription-based services consumers have started to accept more services that offer ‘free’ viewing of content in exchange for consuming ads.
It is estimated that the current AVOD market size is almost $75 billion with projected growth to $120 bn in the next 4 years outpacing SVOD services in growth. Some of the growth can be attributed to the decrease in linear TV advertising and moving into online channels.
What can be expected in the upcoming months? Definitely, continued growth of hybrid services that combine AVOD and SVOD models. AVOD mostly as a part of the free package where viewers get to enjoy content without subscription but with more ads during content consummation. For more premium content and packages subscription is added instead of ads.
As always whether you are looking to start your SVOD, AVOD or hybrid OTT service let us know and we will provide you with an awesome OTT solution with even better support.