Winning the global FAST race: insights and strategies for 2024

The Free Ad-Supported Streaming TV (FAST) industry has firmly established itself as a major revenue driver over the last three years, particularly in the US. As the US market matures, attention is shifting towards emerging regions like Latin America and Europe. Here we look at the key FAST trends, growth strategies, and opportunities based on insights from our recent report with TBI report.

The US market: leading the FAST revolution

The US is still the epicenter of the FAST revolution, with revenues projected to rise from $5.5 billion in 2023 to $6.7 billion in 2024. Gavin Bridge, CRG’s Global VP of Media Research, says that adults in the US use a FAST service at least once a month. By 2030, he predicts that “60% or more” will use them at least twice a week. This growth is fueled by diverse content offerings, including news, drama, children's programming, and lifestyle shows. 

However, the rate of growth will inevitably slow as the market matures. This means the market is entering a period of content and ad optimization.

Key challenges

Despite its success, the US FAST market faces several challenges. Advertisers are still navigating the FAST landscape and its value proposition. Audiences are large and growing, but ad-fill rates remain low. More granular performance data is needed to attract and retain advertisers.

Strategies for success

What can content owners do to overcome these challenges in the market?

• Push for more performance data from platforms so they can create more effective programming. Alternatively, work with a partner that can offer data analysis, like Whip Media 

• Partner with a network that sells ad inventory directly, as is the case with Lionsgate and Fuse Media. 

• Differentiate content: content owners have to harness new formats within the most watched genres or come to platforms with niche programming and proof of a loyal, engaged audience that will follow the content from, say, social to FAST, as is the case with pocket.watch.

• Start with VOD or owned and operated and make a case for a full FAST channel.

Latin America: A fertile FAST ground 

Latin America is emerging as a promising region for FAST, with Brazil and Mexico leading the way. Revenues in these countries are expected to more than double by 2028, driven in no small part by localized content that resonates with cultural preferences.

Omdia’s Tim Wescott says he sees LatAm as “probably one of the most promising areas of growth for FAST outside the US,” adding, “We are seeing growth in connected TV usage, and these are markets with strong local players with deep program archives who will be well placed to benefit.” The key challenge in this region is is economic instability and resultant low CPMS.

Content localization

The introduction of diverse content that resonates with local tastes and cultures has been a great driver of FAST consumption in Latin America. Reality shows, culinary formats, and comedy are proving particularly popular. Aline Iskandar Jabbour, Director of Business Development and Acquisitions at Samsung TV Plus in Latin America, says, “Localization has been instrumental and even a game-changer in attracting a broader viewership base.”

Strategies for success

• Invest in local content: creating content that appeals to local tastes

• Build strategic partnerships: collaborate with local media companies to enhance reach and engagement

• Partner with platforms doing direct ad sales

• Utilize AI dubbing: Leverage AI for content localization to broaden audience reach for content with global appeal

Europe: scaling up despite competition

The UK and Germany dominate the FAST market in Europe, with significant revenue growth projected. However, the region presents unique challenges due to, as The Local Act founder, says, “A more resilient pay-TV and broadcasting space and a plethoric free-to-air offering.”

Revenues in the UK are expected to double to $516 million by 2028, and German revenues will surge to $200 million over the next four years. However, there are many free alternatives, and FAST maturity (in terms of audience size and advertiser uptake) varies by market, which presents challenges for the streaming model.

Strategic insights

• Platform proliferation: The more platforms enter the space, the greater the chance FAST will become embedded in audiences’ viewing habits. Tubi is set to relaunch in Europe later this year.

• Advertiser education: Platforms are trying to demonstrate the value of FAST to advertisers to drive spending, and it seems to be working. A survey led by Freewheel in EU5 countries shows that 89% of markets will redirect budget to AVOD and FAST in 2024.

Strategies for success

• Choose your market wisely: either opt for a mature market (Germany or the UK) of be a first mover in those great potential where your payback period will be longer but you’ll be ready to monetise when the market matures 

• Know your options: Many FAST platforms operate in Europe, including globals like Pluto and soon-to-be Tubi, OEMs like Samsung and Freely, and TELCOs. Matching content offerings to platforms is an important way to ensure returns. 

Rest of the world: emerging markets

Countries like Canada and Australia are significant players in the FAST industry outside the US, Europe, and Latin America. Canada’s revenues are set to surge from $156 million in 2023 to $348 million by 2028. Similarly, Australia’s FAST revenues are projected to more than triple to $238 million by 2028.

Key markets to watch

• Canada: Proximity and business ties to the US drive growth

• Australia: High CPMs and audience suitability for US-produced content support market expansion

• India: Rapid digital adoption and a vast audience base present significant opportunities.

• South Korea: Strong technological infrastructure supports FAST growth.

Conclusion

Global FAST offers great opportunity, but success in this space currently hinges on an understanding of the landscape in terms of viewer preferences and distribution options; catering to cultural preferences and localizing content; and strategic partnerships on the ad sales side. Content owners must focus on:

1. Identifying key regions: Target high-growth areas like Brazil, Mexico, Germany, and the UK

2. Localizing content: Tailor programming to local tastes to maximize engagement

3. Utilizing AI: Leverage AI for dubbing and content localization to increase reach and engagement

4. Partner with networks and platforms that offer direct ad sales

5. For smaller content owners, consider either building an audience on YouTube first, starting with VOD or owned and operated, and making a case for a full FAST channel.

By understanding and leveraging these strategies, content owners can effectively navigate and capitalize on the evolving FAST landscape, ensuring sustainable growth and viewer engagement.

Download the full report for a deeper look at the trends and insights driving the global FAST industry.