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The UK’s streaming landscape is rapidly evolving, with the latest addition being Fox Corporation’s Tubi, following Amazon’s AVOD service launch in February. Although the streaming market is becoming increasingly crowded, both customers and advertisers will welcome Tubi’s entry since it doesn’t come with an added cost.
However, Tubi, relatively unknown in the UK, faces significant challenges. It must compete not only with streaming giants like Netflix and Disney+ but also attract viewers away from established broadcast channels. During a time when viewers are feeling the impact of a persistent cost-of-living crisis, the appeal of free platforms like Tubi and Freely (which launched in April) is strong as they offer a cost-effective alternative to subscription services.
Yet, as consumers seek to reduce expenses, they are unwilling to compromise on quality. Despite Tubi’s extensive library of over 20,000 movies and TV shows, including content from Disney, NBCUniversal, and Sony Pictures Entertainment, it might still seem limited by current standards. Therefore, significant investment in additional content, including original programming, may be necessary for Tubi to attract viewers from other platforms and increase its attractiveness to advertisers.
The move towards ad-supported content in streaming is becoming more apparent with Amazon’s recent launch of an ad-funded model and Tubi’s entry into the market. This trend suggests that AVOD services and ad-supported tiers, like those seen with Disney and Netflix, will continue to grow.
The rise in smart TVs with built-in streaming capabilities has led to increased consumption of CTV content, driving advertisers to invest more in CTV advertising. Consequently, AVOD appears poised to capture a substantial share of TV advertising investment, further diminishing the presence of linear TV.
While Freely, a free-to-air streaming service backed by public service broadcasters (BBC, ITV, Channel 4, and Channel 5), is Tubi’s most notable competitor, it relies on a more traditional ad model, reflecting the programs it broadcasts. However, Freely benefits from established relationships with a wide range of advertisers, ensuring a consistent revenue stream.
Although Tubi has established itself in the US, its entry into the UK market presents unique challenges, including differentiating itself from competitors who have already built a loyal customer base by understanding UK viewer preferences. Introducing a more culturally diverse content library, featuring shows from Bollywood, Nollywood, and arthouse cinema, is a promising initial step.
As an AVOD platform heavily reliant on advertising revenue, it is crucial for Tubi to establish strong relationships with advertisers, demonstrating its ability to deliver targeted and impactful ads. This will be essential for securing the investment needed to carve out a niche in a competitive market.