The Rapid Rise of AVOD Services is Fueled by On-Demand Streaming Trends

 

AVOD or advertisement-based video on demand services provide streamed media which is supported by advertisements. These services allow users to stream vast libraries of films and television shows at zero subscription cost. With subscription fatigue among audiences, AVOD services have emerged as a cost-effective alternative to SVOD platforms. They provide accessible entertainment to cater to the growing demand for on-demand video content.

The global AVOD services market is estimated to be valued at US$ 28.09 Bn in 2024 and is expected to exhibit a CAGR of 14% over the forecast period between 2023 to 2030.

Key Takeaways

Key players operating in the AVOD services market include YouTube (Google), Hulu (Disney), Peacock (NBCUniversal), Tubi (Fox Corporation), Pluto TV (ViacomCBS), IMDb TV (Amazon), Roku Channel (Roku), Crackle (Chicken Soup for the Soul Entertainment), Xumo (Comcast), Vudu (Walmart), The Roku Channel (Roku), Popcornflix (Screen Media Ventures), MX Player (Times Internet), Voot (ViacomCBS). These players maintain huge libraries of TV shows and movies to attract audiences.

The demand for AVOD services is growing steadily owing to factors like increasing smartphone and broadband penetration, and the massive popularity of streaming media. Audiences, particularly younger demographics, prefer the flexibility of streaming content on-demand instead of following traditional TV schedules. Meanwhile, media companies are leveraging AVOD platforms to promote their brands and generate advertisement revenues.

Geographic expansion is another trend witnessed in the AVOD services market. Major players are investing in global markets like Europe, Asia Pacific, Middle East & Africa, and Latin America. Regional localization of content and user interfaces helps capture new customer bases. Partnerships with telecom operators also aid international availability of these services.

Market Key Trends: One key trend in the AVOD services market is the integration of personalized recommendation engines. Using viewership data and AI, services can recommend customized content based on users' watching history and preferences. This enhances user engagement and discoverability of long-tail titles. Personalized advertisements further increase monetization opportunities for AVOD platforms and content providers.

Porter’s Analysis

Threat of new entrants: Low cost of starting up an AVOD service online whereas high investment required for building content library to attract users.

Bargaining power of buyers: High as users can switch between AVOD platforms easily without substantial switching costs. Increasing number of AVOD options provides more bargaining power to users.

Bargaining power of suppliers: Low as AVOD platforms constantly seek new and exclusive content partners globally to attract and retain users.

Threat of new substitutes: High threat from alternate modes of content consumption like subscription video on demand (SVOD), transactional video on demand (TVOD) as users show preference for more premium content and exclusive streaming platforms.

Competitive rivalry: Fierce competition to acquire exclusive and original content through partnerships and acquisitions to gain maximum market share.

Geographical regions: North America holds the major share currently in terms of AVOD services market revenue, attributed to high smartphone and broadband penetration with digital streaming habits developed over the years.

Asia Pacific region is expected to be the fastest growing market during the forecast period supported by increasing youth population, rapid digitization and rising internet connectivity in major countries like India and China. New content partnerships will help AVOD platforms tap into the high growth potential in APAC.

 

About Author:

Ravina Pandya, Content Writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemical and materials,  etc

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it