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Ad-supported video-on-demand or AVOD services provide streaming of television shows and movies without any subscription fees and instead are supported by advertisements. These services allow consumers to access a wide library of on-demand video content for free while allowing media companies and content producers to monetize their content through targeted and non-intrusive ads. AVOD services offer consumers an affordable alternative in comparison to subscription-based video streaming platforms and have gained significant traction in recent years as cord-cutting continues to rise. Streaming services powered by targeted and personalized ads can deliver a better consumer experience while helping advertisers optimize their campaigns.
The global AVOD services market is estimated to be valued at US$ 28.09 Bn in 2024 and is expected to exhibit a CAGR of 14% over the forecast period between 2023 to 2030.
Key Takeaways
Key players operating in the AVOD Services market are YouTube (Google), Hulu (Disney), Peacock (NBCUniversal), Tubi (Fox Corporation), Pluto TV (ViacomCBS), IMDb TV (Amazon), Roku Channel (Roku), Crackle (Chicken Soup for the Soul Entertainment), Xumo (Comcast), Vudu (Walmart), The Roku Channel (Roku), Popcornflix (Screen Media Ventures), MX Player (Times Internet), Voot (ViacomCBS).
The growing demand for cheaper and free streaming alternatives as well as enhanced content diversity and personalized recommendations has boosted the adoption of AVOD services in recent years. Affordable and diverse content offerings along with targeted advertising makes these services very appealing.
Major media companies are rapidly expanding their AVOD footprints globally to capitalize on the significant growth opportunity. Partnerships with telecom operators and pay-TV providers are helping AVOD platforms gain wider reach and scale internationally. Rollouts of custom user interfaces and localized content are also helping global expansion.
Market key trends
One of the key trends in the AVOD services market is the growing focus on enhanced consumer experience through improved search, recommendations, personalized interfaces and controls over frequency and type of ads. Services are investing in AI, machine learning and big data analytics to provide a viewing experience optimized for both consumers and advertisers. This helps drive higher viewership and engagement for content alongside optimized advertising outcomes.
Porter’s Analysis
Threat of new entrants: The rapidly expanding market and barriers to enter make the market attractive for new entrants. However, the requirement of heavy investments and strategic tie-ups pose challenges.
Bargaining power of buyers: Buyers have moderate bargaining power due to availability of alternatives and transparency in pricing. However, buyers also demand customized solutions.
Bargaining power of suppliers: Well established players have strong bargaining power over suppliers due to their scale of operations and demand. However, competition also allows buyers to play one supplier against another.
Threat of new substitutes: Threat of substitutes is moderate as players continue investing in expanding content libraries and platforms. However, rising OTT platforms pose a threat.
Competitive rivalry: Intense competition exists among existing major players to acquire more users and Eyeballs. Players differ based on platforms, content libraries and capabilities.
Geographical Regions:
North America holds the major share of the global AVOD services market currently, primarily due to wide acceptance of streaming services and advanced network infrastructure. The region accounted for close to 45% share of the total market value in 2022.
The Asia Pacific region is expected to be the fastest growing market during the forecast period. Countries like India, Philippines and Indonesia offer enormous opportunities due to rising internet and smartphone adoption, coupled with huge population size and growing media consumption. The region is estimated to grow at a CAGR of around 18% between 2023-2030.
*Note:
- Source: Coherent Market Insights, Public sources, Desk research
- We have leveraged AI tools to mine information and compile it
