The surge in streaming and tightening of consumer wallets has signalled the end of a decade-long ad-free streaming experience, according to research by Samsung Ads
The latest edition of Behind the Screen unravels how evolving behaviours and a changing TV landscape led to the rise of ad-funded streaming in 2023.
During the first half of this year there were more than one billion app open on Samsung Smart TVs, up 12% on the same six months last year.
The rise of streaming and penetration of connected TVs is signalling a growing shift to app-based TV viewing.
More than a third (36%) of newly sold Samsung TV buyers are choosing not to connect their antenna.
Time spent streaming continues to grow.
On Samsung devices two-thirds of all streaming time is spent with Subscription video On-Demand (SVOD) services.
Time spent in ad-funded streaming grew the fastest, with double digit growth across all formats.
However, traditional linear TV remains an environment of high engagement, although across an increasingly concentrated group of heavy linear viewers who account for 88% of the total time spent within linear on Samsung Smart TVs.
Streaming services pioneered binge watching and exploited the key differentiator of being ad-free over the last decade.
One of the biggest changes in the last 12 months has been the introduction of ads, as services rethink strategies to appeal to a wider set of more cost-conscious viewers.
Netflix this month announced that its ad-supported tier now accounts for 16% of its subscriptions, up almost 70% globally.
Other paid streaming services revealed that ad-supported plans are already proving more lucrative per user than a pure subscription play.
The appeal of ads continues to grow, with three out of five (61%) Australians saying they don’t mind watching ads in return for free content - and that appetite would be even higher if fees were reduced further.
According to Kantar, almost half (48%) of subscribers are now more likely to switch between different services than before to save money.
Increasing production costs, writers strikes and consumer belt-tightening have also taken their toll on the streaming industry, with several big players reportedly looking to cut billions in costs.
In Australia, Free ad-supported streaming TV (FAST) is one of the newest services. Behind the Screens Australian FAST report reveals as of September there were 522 FAST channels in Australia across multiple services.
The adoption of free streaming has leapfrogged some of the FAST innovations in the US. Single show channels now account for one in every five FAST channels in Australia giving local audiences 24/7 access to everything from Married with Children to Mythbusters.
“The adoption of ad-funded streaming suggests the future of TV has more in common with the past than we think,” says Alex Spurzem, managing director, Samsung Ads ANZ & SEA,
“The notion of introducing ads after a decade-long ad-free streaming experience would have seemed impossible just a few years ago.
“Yet platforms are now focused on drawing in the widest audience by catering to all wallet sizes. With the rise of TV app based viewing it is important for advertisers to understand the insights and behaviours of these growing streaming audiences.”
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