When TV advertising rebounds, it's going to be a game enjoyed by different players.
Shifting viewing behavior has been compounded by pandemic business economics.
In this video interview with Beet.TV, Mark Rotblat, CEO of Tubi, the ad-supported video platform acquired by Fox last year, says that leaves providers in the category sitting pretty.
Upfront bounce-back "(Last year), some advertisers lessened their their upfront (TV ad spending) commitments, or they sat out completely - and then others jumped in and made up for it," Rotblat says.
"The advertisers that tried to then change course and get back in middle of Q4, some of them were left out of what they really wanted in terms of amount of inventory.
"This year, we expect the pressure to be even greater as traditional brands that are in industries like automotive, entertainment and travel come back to full strength." What does full strength look like?
It looks like traditional TV supplanted by new, ad-supported video-on-demand (AVOD) services.
The likes of Tubi, Pluto TV and Xumo, amongst others, are offering viewers a TV-like experience and advertisers the targeting capabilities they have enjoyed in digital.
Murdoch's expectations https://twitter.com/MediaPlayNews/status/1368002039691710464 Which is why Fox came sniffing.
In summer 2020, the company acquired Rotblat's Tubi for $440 million.
In last month's earnings call, Fox Corporation CEO Lachlan Murdoch was bullish on the deal: "We envision Tubi becoming a $1 billion business and a core pillar of Fox.
"Revenue for this past quarter alone broadly approximated Tubi’s revenue for the entire fiscal year before we acquired the company.
"We expect Tubi revenues to more than double in the current fiscal year, to exceed $300 million." If that target is also pressure, Rotblat doesn't seem phased.
"Tubi has been essentially P&L-neutral for Fox," he says, "which is just so different than the businesses of SVoD competitors and those who are really losing billions a year on content as investment." Market position https://twitter.com/Tubi/status/1362122588592480258 Amid the ongoing boom in subscription video services (SVoD) like Netflix and Disney+, which are cornering the market for premium catalog, we are seeing the rise of free AVoD services, with acquisitions in tow – Xumo to Comcast, Pluto TV to Viacom and Tubi to Fox.
AVoD has become a key trend just as the services found new potential customers currently locked-down at home.
More than 80% of Tubi’s viewing takes place on TV sets.
Tubi is an ad-funded (AVoD) TV service at a time when many advertisers are pulling back on spending.
But Tubi is also has also seen dramatic growth in stay-at-home viewing numbers during the pandemic.
Targeting and control offered by digital-style buying may give advertisers the confidence they need in results from their spend.
Consumers’ premium SVoD subscriptions may be tested in the months ahead - if economic conditions worsen, free TV could look attractive.
Complementarity The Fox acquisition will help all of that.
By November, Tubi was streaming about 200 million hours of content a month, up from about 160 million hours in its pre-pandemic days.
Rotblat says: "What's different in the programme is we continue to get great Fox content from Fox Entertainment, and there'll be more and more to announce as part of the upfronts this year, "Tubi streamers are 20 years younger than the TV linear audiences.
So that's where there's complementarity to those on linear and particular than on our Fox Entertainment and Fox portfolio of counterparts.
"We have about 80% of our streamers can't be reached across the top 25 cable TV networks, 64% of Tubi streamers can't be reached across Fox Entertainment."
