US AVOD set to overtake traditional ad market by end of 2025 | Media Analysis | Business | News | Rapid TV News
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After barely accounting for 10% of the US advertising TV market five year ago, a new research post from Dataxis expects the multiplication of distribution partnerships and content releases to take advertising video-on-demand (AVOD) to a leadership position in revenues by 2025.
Dataxis 13Sep2022
In the posting by senior analyst Thibault Giry, Dataxis said that until now growth has mainly been driven by YouTube and its over-dominance in the AVOD landscape, AVOD revenues in the next few years are expected to be driven by the multiplication of FAST channels from traditional content owners, the re-bundling of existing content offers toward more ad-supported options, and a wider availability of these offers across the largest number of devices and connected TV platform.

With YouTube (Google) and Freevee (Amazon) already well implemented in the AVOD landscape for years, Dataxis also believes that the arrival of three of the remaining US media giants sets up a new stage in the transformation of the video market in the country.

And while Dataxis expects platforms like Roku or Samsung TV Plus to become leaders of the FAST landscape due to their significant presence in the CTV market, it added that a service such as Pluto TV could also manage to win on both sides, providing at the same time Paramount content through its own channels and aggregating a growing number of external channels through distribution partnerships, taking advantage of its massive reach.

Looking at reasons for the growth, Dataxis said numerous signs had already indicated the acceleration of AVOD consumption over TV and, more recently, over SVOD.

In its report, Dataxis saw AVOD representing a tremendous opportunity for companies to re-linearise their content online, especially through FAST channels. Yet it cautioned advertising revenues will not be the only KPI to evaluate the efficiency of AVOD strategies. It added that AVOD was increasingly seen as a way to better promote already existing SVOD offers and to increase global retention than just a way to diversify and increase revenues – especially in the FAST segment, where CPMs are growing quickly but remain low.