At the Berlinale’s European Film Market, Ampere Analysis’ Executive Director Guy Bisson hosted a talk about emerging business models in the audiovisual industry, focusing, in particular, on the latest market trends involving SVOD, AVOD and FAST in Europe and the USA.

Held on 19 February, the event was part of the “Shifting Business Models with an A” conference, moderated by AC Coppens and held in the Event Hall of Berlin’s Documentation Centre for Displacement, Expulsion and Reconciliation.

(L'article continue plus bas - Inf. publicitaire)

“My first ‘a’ is ‘altered reality,” began Bisson, explaining how “the reality of doing business has changed because the streaming market in particular has moved to a very specific place in its development due to the concurrence of different factors.”

The past 18 months have seen this “crowded market” witnessing several shifts. The most important and impactful of these concerns audiences, since streamers have shifted from “customer acquisition mode” to “customer retention mode.” In this respect, the SVOD audience is “maturing and generalising.” In terms of advertising, business players now aim to diversify revenue in light of the “inflection point reached during the pandemic, when AVOD surpassed TV ads in value for the first time, worldwide.”

“The dramatic rise in AVOD usership over recent years can be attributed in part to the COVID-19 pandemic. During lockdowns, consumers turned towards ad-supported services to supplement their viewing. More recently, the importance of AVOD services is rising, as high inflation is being observed across many major economies and consumers are reaching a ceiling in their willingness and ability to stack multiple SVOD subscriptions,” he further explained.

More generally, he added that all players, except Apple, are shifting to a hybrid business model to keep up with all these market transformations.

“It’s all about geography,” stated Bisson, speaking about FAST. The figures he provided show significantly higher FAST penetration in the US (32%), Brazil (16%) and Argentina (13%), followed by Spain (10%), the UK (7%), Germany (7%), Italy (5%) and France (5%). He then revealed some US-related figures, specifically, the fact that total online video advertising revenue in 2022 accounted for around $97 billion (of which 8% was made up by AVOD platforms). The revenue of AVOD platforms includes 35% which is made up by FAST channel providers (approx. $3 billion).

Returning to the subject of audience trends, Bisson underscored how “Europe’s AVOD/FAST audience is a little lacking,” but “it doesn’t mean there’s no demand for free streaming,” since “half of European homes are watching free streaming from the major public and private broadcasters, a segment that’s insignificant in the US.” Moreover, he disclosed that European AVOD/FAST users “are far more likely to be male (60%)” and “much more likely to be older than 35.”

There are many opportunities to exploit some of the aforementioned trends and to target such a large untapped market, Bisson argued. In this sense, audience specifics are essential to understand content demand: for example, European AVOD viewers are keen to watch much more science fiction, horror and anime than their SVOD counterparts. Next, he highlighted the presence of “small but growing opportunities” for original commissions from FAST: “[There are] no vast volumes at the moment, but we’re going in the right direction.”

He also pointed out AVOD’s tendency to be less exclusive than SVOD and therefore the opportunity for content producers to distribute via all possible outlets and maximise reach and revenue earned on their content.

Anyone thinking about launching a FAST channel should, however, take some essential figures into account. Bisson revealed that there’s an average of 231 channels on a FAST platform, of which 60% are based on a single show franchise and 40% are genre-based, featuring multiple show brands. Moreover, 13 shows are shown each week on genre-based channels, and the best-served show genres are currently documentaries and children’s content.