Summary: FAST is new in town and it’s here to stay
As a child in the 90s, I learned that any piece of “free” media delivered over the internet typically came with a side of malware. But that didn’t stop me from exploring the wild west that was the internet and finding sketchy ways to watch and download movies after school every day. And it was exhilarating. There’s nothing like the panic of closing out a bajillion pop-ups just to watch Twilight and knowing that you’re running the risk of infecting your computer (which did happen). Thankfully, as an adult, I’ve traded in my swash-buckling ways for better cybersecurity judgement and legal means to consume entertainment.
The digital landscape has evolved significantly, with a robust and interconnected infrastructure that enables safer and more convenient content consumption. Subscription-based streaming has become the dominant medium for accessing movies and shows online. However, in recent years, a newer subcategory has gained traction: free ad-supported TV (FAST). Platforms like The Roku Channel, Tubi, Pluto TV, Xumo, and Samsung TV Plus offer viewers set channels and on-demand content at no direct cost. From a user experience perspective, FAST channels feel familiar, as they integrate advertisements and traditional television programming. However, these channels tend to be more niche-focused, with more personalized advertisements compared to the traditional cable experience. FAST’s footing in the content ecosystem reflects changing consumer preferences, economic forces, and technological advancements that I’d like to explore at a high level here.
But first, a brief history. FAST is new, even in the context of streaming services, which have only been around for 15-ish years. Pluto TV was one of the early pioneers in the space, launching in 2014 with 100 channels pulling in content from YouTube, Vimeo, and Daily Motion. This was considered contrarian at the time, as the prevailing wisdom was that subscription models and original content were the future. However, Pluto TV quickly gained traction and demonstrated that there was a viable market for ad-supported free streaming. The platform's ability to aggregate and curate diverse content from across the web proved appealing to viewers looking for a simple, cost-effective way to access a broad range of programming. Pluto TV’s success didn’t go unnoticed. In 2019, it was acquired by media giant Viacom/Paramount for $340M, signaling the growing importance of the model. Inspired by Pluto TV's example, other players began to enter the space. In early 2020, Fox Corporation announced the formation of the Tubi Media Group after acquiring Tubi TV for $440M in net cash. This move further solidified Fox's D2C strategy and its commitment to the ad-supported streaming market (also good timing, eh?). Alongside these platform acquisitions, the FAST landscape has also seen impressive content growth. For instance, Roku, a leading streaming device and platform, impressively managed to grow its movie and episode count from 1,000 to 10,000 between 2017 and 2018/2019.
Today, the FAST ecosystem is vibrant with wide-ranging contributors. Platform providers include Roku, Samsung TV, Plex, Pluto TV, and Amazon Freevee. It also includes traditional media companies like Paramount, Fox, and NBCUniversal as well as much smaller content creators. According to Variety, “FAST can be expected to grow in the coming years, through a combination of SVOD [subscription video on-demand] services that blend in FAST channels (such as Prime Video) or services built into TV sets (e.g., Samsung, TV Plus, LG Channels).” Does this mean it won’t be long until the big boys like Netflix, Max, Disney+, and Apple TV+ launch their respective versions? I suspect so since FAST seems to be a natural avenue for these providers. Especially for Netflix and Disney+, which have deep libraries and expansive IP, I imagine there’s a pocket of idle content within these platforms that would be good candidates for FAST. I also suspect that the growth will also be supported by a growing number of newer participants like CNN, which launched three FAST channels over the last year. Btw, Match Point has an excellent article on the history of FAST here, which informed some of the material above.
In terms of total viewing time for the average viewer, FAST has grown over the last year. According to Nielson, Pluto TV, Tubi, and Roku Channel accounted for 3.7% of total TV time in the US as of February 2024, up slightly from 3.3% in May 2023. And where there are viewers, there are advertisers. According to Digital TV Research, global FAST revenue is expected to reach $17 billion in 2029, up from $8 billion in 2023.
FAST also comes at a time when the digital infrastructure is finally ready for it. High-speed internet means consumers are no longer limited by physical constraints and thus have quality content available at their fingertips. The internet-of-things and connected devices like smart TVs and streaming devices like Roku, Amazon Fire TV, and Apple TV often come pre-installed with FAST apps. Good riddance…antennas and cable boxes always stressed me out. This greater connectivity has also allowed ads to be dynamically integrated into streaming content thanks to Service Side Ad Integration and AI, viewers can receive more personalized ad experiences. In a nutshell, the evolution of technology has led to improved user experiences and a new era of products that weren’t possible 10-15 years ago.
From a business stand-point, FAST is, to quote Hermione Granger, simple but powerful. Amidst the increasing cost of subscription fees, FAST is a welcome addition to the provider lineup, particularly for budget-conscious viewers. The model is also inherently cost-effective, as it avoids the high cost associated with acquiring and retaining subscribers for paid services and the high cost of original programming. Tom Ryan, the co-founder of Pluto TV, explains it best here:
“The business models are just so different. There’s no coincidence that Pluto TV began as a startup, because it was a much more capital-efficient business model than the paid streaming model. We pioneered the 50/50 rev share model for content and that is prolific today among most of the FAST providers. But with Paramount+, there’s significant fixed costs, which we are well on our way to exceeding, but it’s a different model. You commit billions of dollars of content expense per year in order to acquire and retain those customers. Less than three years after launch, we have close to 68 million subscribers. We’re well on our way to exceeding that threshold, but at the same time, it’s just a very different business model.” (source: Fast Company)
While FAST seemed to have risen relatively quickly, it has undeniably become an established part of the streaming ecosystem. It comes at a time when the technological stars have aligned from an infrastructure, data science, and UX/UI perspective. It’s also complimentary to the dominant, subscription-based streaming players. It seems to create a win-win situation where entertainment providers can capitalize on idle content, advertisers can reach new audiences with more tailored ads, and consumers can enjoy a wide range of free programming at no direct cost. As the streaming wars continue and subscription fatigue sets in, FAST channels seem poised to carve out an increasingly important role in the evolving media landscape. I'm looking forward to tracking FAST's continued evolution and impact over the next several years.