The rise of internet-delivered TV has produced an explosion of new services in the United States, and we’re beginning to see the same in the United Kingdom. Acronyms like AVOD and FAST are now part of our daily jargon, but occasionally they seem interchangeable. To some degree, that’s understandable as AVOD can also sometimes be offered alongside FAST, but that doesn’t mean they’re the same. And for reasons I’ll explain, it’s important to understand the difference.
Crucial Differences
Where AVOD (advertiser-supported video-on-demand) is a purely on-demand experience, FAST (free, ad-supported streaming TV) mimics the linear TV experience. What unites these two platforms is the means of delivery (internet) and that they are both free and ad-supported. To make matters more confusing, both can target niche audiences. But the critical difference is that one requires the viewer to take the lead and choose what they’re going to watch and when, while the other does not. AVOD invites the viewer to become an active participant, while FAST openly declares itself to be a “lean back” experience.
This distinction matters because one of the key reasons that digital video advertising has continued to grow in spite of the pandemic’s chilling effect is its ability to reach specific audiences in a way that traditional TV advertising cannot — that is, in a way that actively engages the viewer. There is nothing new in the notion that advertisers want to reach engaged audiences and they’ll pay a premium for higher levels of engagement. So when we turn our thoughts to the difference between AVOD and FAST, AVOD services clearly come out on top in terms of engagement.
But let’s back up a bit. FAST channels were born largely out of Americans’ desire to cut the cord (and save a ton of money in doing so) while maintaining the feel and massive amount of choice that linear cable subscriptions provided. It wasn’t quite the same here in the U.K., however, as we never really reached the same level of cable penetration as seen in the U.S., and we already had a lot of free TV options.
But like the U.S., the U.K. has seen the uptake in OTT services explode. The volume of views on OTT services has risen nearly 50% year-over-year. Still, AVOD choices are few here and most free VOD is catch-up content provided by broadcasters and therefore limited. AVOD that offers a wider range of genres, or specific niche content, like IMDbTV, Fubo and Tubi in the U.S., are ripe to take off in the UK. A recent survey revealed that the majority of UK consumers (60%) say they would watch ads to be able to access content for free. And according to a Valassis study, 54% of consumers 25-54 said that ads on streaming services were more relevant than those on traditional networks.
Customization Is Key
So while it’s likely that U.K. viewers will embrace FAST and AVOD, or hybrids therein, as audiences have in the U.S., the success of these platforms will come down to the ability to capture and keep viewers engaged and advertisers happy. When our team at YouLook.tv set out to build a better AVOD for the U.K., we recognized that quality content curated for the U.K.’s diverse audiences would be key to the advancement of ad-supported services here. Overall, the on-demand environment is better suited to provide viewers with a more customized experience while also providing advertisers with a way to reach those “lean forward” viewers in a credible, relevant way.
David Smyth, a former 20th Century Fox and BSkyB exec, is founder and CEO of YouLook.tv, a new AVOD platform in the U.K. and Ireland.
