FAST Platforms Had Bigger TV Share Than Many Premium Streamers Once Again In June — What Is Driving Their Success?

Katie Campione
·8 min read

Free, ad-supported streaming television continues to be on a growth trajectory, once again rivaling its premium subscription counterparts in June.

For the second month in a row, Tubi, the Roku Channel and Pluto TV collectively accounted for a bigger share of television (4.3%) than the combined total of Max, Paramount+ and Peacock (3.7%), according to Nielsen’s latest edition of The Gauge, a monthly streaming report.

More from Deadline

Tubi took a 2% share of TV usage, an impressive 14.7% growth from May, putting up nearly identical statistics as Disney+. In fact, when Disney+ is added into the premium services’ collective total, it just barely surpasses the combined usage of the FAST channels at 4.7%.

The obvious answer to the success of the FAST channels is that they are free, which is very enticing to consumers with the rising cost of every premium service, but there are also several other universal truths that these platforms have acknowledged (and built their platforms on) that have contributed to this growth.

“It has been a long time coming,” Andrew Rosen, a former Viacom executive and the founder of streaming newsletter PARQOR, tells Deadline. “What FASTs are ultimately proving in the wake of Netflix’s success is that the product and viewing experience matters as much, if not more, than the content being watched. FASTs are increasingly winning because they are products first, and walled gardens for content last.”

After years of premium streamers jockeying for subscribers, those leading the FAST channels argue that the future of television probably looks a lot like the past. Only now, it’s on the internet, and it’s on demand.

“Stage one of streaming wars really was painting this picture that ultimately what was the pay TV model, 10 to 15% of the market, was going to dominate,” Adam Lewinson, Chief Content Officer at Tubi, said. “The reality is…SVOD is and will continue to be a very robust piece of the market, but the majority will still be free, ad-supported.”

The concept of free, ad-supported television is not new. Throughout history, a vast majority of television viewing has followed this model and, up until about a decade ago, that remained true. As the streaming era redefined television, linear models began to decline — and they still are — as a larger portion of audiences make the transition to streaming.

Cue the streaming wars. In an effort to rival Netflix, the legacy studios began to take back their content and create, as Rosen put it, these “walled gardens” where viewers had to pay to play.

“The demand for streaming libraries is much lower than they had assumed,” Rosen said. “Walled gardens are less valuable in the streaming era. That reflects as much a problem of imagination as it does execution.”

As Disney was building its streaming service in 2019, CEO Bob Iger told The Wall Street Journal, “I think if people are clicking on Mickey Mouse, they mostly want Mickey Mouse.” That’s the philosophy on which all the premium streamers built their platforms.

They relied on the strength of their own libraries to convince audiences to pay a monthly subscription fee to access only their content on a monthly basis, without churning out. Turns out, that wasn’t exactly a winning strategy for the longterm, and even the premium streamers eventually began to introduce lower cost, ad-supported subscriptions.

“Tubi, Roku Channel and Pluto all reject that logic. If someone is clicking on Mickey Mouse, they want to be entertained, and Mickey Mouse isn’t always the answer to that entertainment,” Rosen explained.

Instead, the FAST channels rely much more on their distribution tactics with a secondary emphasis on the library of content. They bank on their technological expertise to perfect their algorithms that provide personalized recommendations and build dynamic user interfaces and operational back-ends that contribute to a more satisfying experience for many viewers.

At the end of the day, the success of these platforms hinges on how much time a person spends on one versus the other. If someone logs onto Disney+ to watch the latest episode of The Acolyte and then immediately exits the app, the streamer hasn’t exactly done its job. Similar to Netflix, the FAST channels care much less about what a viewer is watching and more so that they keep watching.

That’s why the personalized recommendations and user interface are key to the success of the streaming model. If a viewer is a fan of horror, the algorithm should recognize that and provide them with more horror content to keep them satisfied. If they’ve just binged all seven season of Scandal, which are on Tubi, then there should be more shows like the Kerry Washington-led drama to hold them over.

“From a user standpoint, it’s the totality of the experience. So when you think about going to a concert, you think about the show that you just saw, but also the view from your seats and who you were sitting next to, and the price of concessions and how long it took to get out of the parking lot,” David Eilenberg, Roku Media’s Head of Content, told Deadline. “You have to think about the entirety of the user journey.”

For younger audiences, this is a model they’ve become accustom to by growing up in a social media era, where watching hours of content on YouTube (which is still the most-watched streaming platform to date) was the norm. When one video ended, a whole list of personalized recommendations was available to keep going.

It’s up for debate whether age demographics matter much anymore, particularly when total viewers seems to be the metric everyone it touting these days, but young viewers have always been a coveted group in television. There was a time when the 18-49 demographic was the primary indicator of success for a television series, because it was the audience that advertisers cared most about. And if there’s one thing that this generation of young viewers knows, it’s the internet.

TikTok ushered in an era of short-form videos that, as this demo flocked away from linear TV, led many of the legacy studios to believe that maybe young people didn’t care about long-form content at all anymore. The leaders of the FAST channels argue that isn’t necessarily true.

“Tubi is an example of that just being a myth,” Lewinson said. “Are they on social? Are they watching short form? Of course. [But] Gen Z loves to watch long-form content. It just needs to be relevant, and it needs to be presented in a way that they want it presented, which ultimately is streaming and on demand.”

Content may not be the only factor in the success of a streaming service, but it does have its own role to play. On that front, the FAST channels have been competing with the premium services by, once again, taking the opposite approach. That is, relying much more on acquired content than their own originals.

Tubi, the Roku Channel and Pluto have all dipped their toes in the originals market. In April, The Spiderwick Chronicles became Roku’s most-watched on-demand title ever in its debut. Deadline recently touted Tubi’s Big Mood, starring Nicola Coughlan and Lydia West, as one of the best shows of the year so far. Lewinson says roughly 26% of Tubi’s viewership each month comes from original content.

Still, licensed content makes up a vast majority of the library on every FAST service. Eilenberg says he thinks that will always be the case.

“We need and rely on a healthy, larger entertainment ecosystem, because we can’t populate the channel with enough content if we don’t have strong partnerships,” he said.

The legacy studios have started to realize the inevitable truth here, that they are better served by licensing much of their content to other streamers with a larger, more diverse reach. That’s why so many titles have gone to Netflix and found new life, like Young Sheldon, Suits, and more recently Showtime’s Your Honor.

The same is true for the FAST channels, which boast a range of acquired titles from Gossip Girl and Scandal to even newer titles like Interview With A Vampire Season 1 and Killing Eve. As the market leader in smart TV devices, Roku even has the added advantage of being able to market all of this content to people via “Roku City” and the home page via which users get to all their favorite apps.

And, when a viewer is done with one title, there’s thousands of other similar ones for them to choose from. Roku has even begun introducing single-title channels, for “when viewers really just want to be with a particular show, and it’s immaterial what specific episode it is,” Eilenberg said.

Sounds a lot like the old days of television, when reruns of Seinfeld might air in hours-long blocks on cable for the passive viewer’s enjoyment.

This begs a big question for consumers: Why pay at all when so many titles are (or will be) available for free?

“As long as the tech and user experience of FASTs are better than the paid products, then questions about the value of Disney+/Paramount+/Max are going to grow,” Rosen said. “Why do these services exist if they cannot get target customers to pay to watch their libraries?”

Best of Deadline

Sign up for Deadline's Newsletter. For the latest news, follow us on Facebook, Twitter, and Instagram.

  • Up next
  • Up next
  • Up next
  • Up next
  • Up next
  • Up next
  • Up next