Study: Lack of new content not an issue for free streamers
October 24, 2023
More than half of US adults that watch free streaming video on TV think pro-bono viewing offsets the dearth of newer shows and movies in service offerings, according to research from Aluma Insights, a Colorado-based CTV research firm. Only 16 per cent of adult viewers disagree.
Two of the key shortcomings of free streaming services are they lack the latest shows and movies, and that they require the viewer to tolerate a pay TV-like ad load. Service providers bank on the fact that viewers understand these tradeoffs. Aluma’s research touches on both subjects.
“While free TV streaming services are generally used as secondary or tertiary sources of content, they are putting a dent in the viewing of primary paid sources,” said Michael Greeson, founder and principal analyst at Aluma Insights. “Given how rapidly the retail prices of paid services are increasing, we expect not only will more viewers turn to free streaming services for TV content but they will spend more time watching them.”
This is especially problematic for large tech-media companies that own both paid and free TV services, as with Google, Amazon, Paramount and Fox. Effectively windowing content between paid and free models is key to minimising viewing cannibalisation.
The chief reasons 40 per cent of free TV streamers increased their viewing time include:
- Viewers ages 18-34 – The younger the FTS viewer, the more likely they are to think free access compensates for the lack of new shows & movies. This is particularly encouraging for services that aggregate content for young adults, and
- Innovators & Early Adopters – As adopter status advances, so does the percentage of viewers that think the tradeoff works well.
Aluma points out, however, 30 per cent of viewers had no opinion about the content trade-off, meaning a significant part of the jury is still out, poised to go negative if the quality of already lower-value content further declined. Thus, free TV streaming providers should think carefully before adding additional ad minutes to current loads, and instead look to improve the ad-viewing experience by, for example, reducing the frequency of repetitive ads.