Business

In the ever-evolving landscape of video streaming, platforms are continually adapting to meet the needs of both advertisers and audiences. The four key models are FAST (Free Ad-Supported Streaming TV), AVOD (Advertising-Based Video on Demand), SVOD (Subscription Video on Demand), and TVOD (Transactional Video on Demand). Each of these models offer distinct ways of generating revenue while engaging viewers. Below we will explore how each model works and how they can help you make smarter choices for your advertising strategy.

FAST (Free Ad-Supported Streaming TV) 

FAST platforms provide a linear TV-like experience, where users tune in to scheduled programming, similar to traditional broadcast TV. These platforms are an excellent choice for advertisers looking to leverage traditional broadcast advertising models in a digital format, reaching viewers in real-time. Popular FAST platforms such as Pluto TV, Tubi, and Freevee are seeing significant growth, and market research predicts the global FAST market will reach $9 billion by 2024. For viewers, FAST is a simple and convenient option, delivering continuous streams of scheduled content across various channels without the need to make individual viewing decisions. This is especially appealing to those who appreciate the simplicity of linear TV without the hefty subscription fees. The content is funded by ads, which helps keep the service free for users. 

On February 9, 2025, Super Bowl LIX aired on Tubi, with 10% of the total game viewership coming from the free streaming platform. This marks the first time in history that the Super Bowl has aired on free ad-supported streaming TV, highlighting the changing nature of live broadcasting, advertising, and viewership habits.

AVOD (Advertising-Based Video on Demand)

AVOD is a free streaming service supported by advertisements, allowing viewers to access content without a subscription fee. This model generates revenue by monetizing the viewer experience through targeted advertisements, which run before, during, or after content. Since the platform doesn’t charge a subscription fee, it attracts a wide range of viewers, making it an attractive option for advertisers looking to reach diverse demographics. These services typically host proprietary libraries of studio-licensed movies, TV shows, and other content, giving users access to a rich variety of programming. 

Popular AVOD platforms like YouTube, Roku, and Crackle offer substantial revenue potential for advertisers looking to maximize their impact. With its low barrier to entry for viewers and its effective monetization strategy, AVOD is quickly becoming a dominant force in the streaming world. Global AVOD revenue is projected to reach $63 billion by 2027, highlighting how fast this segment is growing in the streaming space.

SVOD (Subscription Video on Demand)

SVOD requires users to pay a recurring subscription fee to access content. With no ads interrupting the viewing experience, SVOD platforms offer a more premium option for consumers. This model appeals to advertisers as well, as it offers more tailored ad opportunities and often works best when paired with a deeper understanding of the subscriber base’s preferences and behavior. 

Popular SVOD services like Netflix, Disney+, HBO Max, and Prime Video give subscribers access to exclusive and ad-free content libraries, which include a mix of originals and premium films and TV shows. Subscription fees for these services generally range from $5 to $15 per month, depending on the platform and plan. 

Despite increased competition in the market, SVOD continues to dominate the streaming industry. SVOD subscriptions are forecasted to reach 1.5 billion by 2026, showing the continued growth of this model. 

One of the defining features of the SVOD model is the flexibility it offers. Subscribers can cancel at any time, which presents a challenge for platforms in terms of customer retention. To combat this, SVOD services often rely on a combination of strategies, such as offering unique and new content, aggressive pricing methods, and special promotions.

TVOD (Transactional Video on Demand)

TVOD, on the other hand, operates on a pay-per-view model, where viewers pay for individual pieces of content rather than subscribing to a service. This is often used for movies, special events, or one-off releases. For advertisers, TVOD represents a more direct form of consumer engagement, where the audience has already made an intentional purchase, making them more likely to interact with carefully targeted promotional content. TVOD models include options like DTR (download-to-rent), PPV (pay-per-view), and EST (electronic-sell-through). 

Platforms such as Amazon Prime Video, Apple TV, Vudu, and other transactional services effectively monetize new movie releases, live sports, and exclusive content through TVOD. To attract customers, TVOD providers often employ promotional strategies such as offering discounts on new releases, bundle deals for related content, free previews, or loyalty programs for frequent users. These strategies help TVOD services compete and thrive as an appealing alternative to subscription-based streaming platforms.

SUMMARY

Each of these video streaming models presents unique opportunities for advertisers. Whether you’re aiming for broad reach, subscription-based loyalty, or a mix of both. The Moran Group is here to help you navigate nuances of AVOD, SVOD, TVOD, and FAST and can help you craft a more effective and targeted advertising strategy to reach your potential customers at the right place and at the right time. Connect with us to get started! 

SOURCES:

1. https://www.newscaststudio.com/2024/02/29/navigating-the-world-of-streaming-understanding-fast-avod-svod-and-tvod/
2. https://www.fastpix.io/blog/streaming-monetization-models-svod-avod-fast-tvod-bvod
3. https://www.emarketer.com/content/super-bowl-deliver-on-ratings--ads--streaming#
4. https://www.tatari.tv/insights/why-streaming-was-the-real-mvp-at-this-years-super-bowl#

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