The corresponding impact on SVOD, broadcast, and pay-TV viewing is notable
October 10, 2023
Forty percent of US adults that watch free TV streaming (FTS) services such as YouTube, Pluto TV, and Freevee reported an increase in time spent viewing the services compared with last year, two-thirds of which consequently decreased the time they watch other TV services—this according to new research from Aluma Insights, a Colorado-based CTV research firm.
One-third of adults that increased their use of FTS services consequently decreased the time spent watching subscription video-on-demand (SVOD) services such as Netflix. Twenty-three percent reduced time spent watching broadcast and legacy pay-TV services, 22% time spent watching virtual pay-TV services such as YouTube TV.
“While free TV streaming services are generally used as secondary or tertiary sources of content, they are putting a dent in the viewing of primary paid sources,” said Michael Greeson, founder and principal analyst at Aluma Insights. “Given how rapidly the retail prices of paid services are increasing, we expect not only will more viewers turn to free streaming services for TV content but they will spend more time watching them.”
This is especially problematic for large tech-media companies that own both paid and free TV services, as with Google, Amazon, Paramount Global, and Fox. Effectively windowing content between paid and free models is key to minimizing viewing cannibalization.
The chief reasons 40% of free TV streamers increased their viewing time include:
- Free services have more shows they enjoy watching (selected by 48%)
- It’s easier for them to find something interesting to watch on free streaming services (46%)
- Substituting for pay-TV service they’d cancelled (23%)
- Substituting for SVOD services they’d cancelled (22%)
The consumers segments most likely to have reported an increase in free TV streaming are viewers over the age of 55, living in households with incomes less than $50K, or those with children under 18 living at home.
About the Research
In July 2023, Aluma Insights surveyed nearly 1,900 US adults that watch free on-demand (FVOD) or free ‘live TV’ streaming (FAST) services about which of 40 such services they use, how frequently they view them, their contribution to TV viewing time, and their value relative to paid services such as Netflix, among other important usage characteristics. Three reports based on this research have been published, the fourth to be available in November.
About Aluma Insights
Aluma provides research-based strategic insights to companies in the CTV value chain, including creators, aggregators, and OEMs looking to master the connected TV ecosystem. To inquire further about Aluma’s services, please contact us at firstname.lastname@example.org.