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YouTube continues to be the ultimate AVOD service, highlighting just how profitable the business model can be. While also acting as reinforcement to a market that’s now seeing a rise in AVOD strategies.
AVOD is ad-supported video, and while some services take more of a hybrid approach by combining AVOD and SVOD strategies, at its core the AVOD model relies on being free. The rise of free TV services has increased massively over the last year and that looks set to continue in 2020, and throughout.
Recent data from App Annie indicates that when it comes to streaming Android apps, YouTube was – by some margin – the most-streamed video app of 2019. In fact, of the top 5 time-spent video streaming Android apps, YouTube accounted for “7 out of every 10 minutes.”
While most won’t be surprised by that figure, the rest of the ‘top 5’ was made up of Tencent News, Tencent Video, iQiyi, and Xigua Video. All of which have had their viewing time heavily fueled by views in China – the same place where YouTube is inaccessible. A point that highlights even with the increasing impact of China’s domestic smartphone market, YouTube TV is not only remaining ahead of the pack, but absolutely dominating streaming hours on Android.
AVOD is streaming’s new fashion accessory
Prior to the release of this data, Google announced its latest earnings report and for the first time, confirmed more than $15 billion in YouTube ad revenue. Likewise, Tubi recently released its latest figures, confirming the free streaming service now has more than 25 million monthly users. Both instances only further highlight the impact of the AVOD model and the wide appeal to all streamers of free content. This is an area that has particularly picked up pace recently with many companies. including Sling TV, NBC, and Redbox looking to cash in on the ad-supported format.
Of course, an AVOD strategy alone is not necessarily enough to make it in this industry, with content continuing to remain a key driver. While that’s something YouTube has in excess (considering the rate of uploads it sees every minute), as App Annie points out, one of the other content advantages YouTube has over the competition is its mixture of short and long-from content. A balance that ensures the service appeals to all types of viewers and preferences.
This is a major difference compared to the other services which typically try to market themselves as one or the other. Quibi is the latest example, with the service hoping to become the go-to option for short-form videos in the future.
Source: App Annie