Navigating the Fast-Paced World of Streaming: Insights from VideoElephant and Industry Trends
In the ever-evolving landscape of streaming television, new players and innovative strategies continually reshape the way content is consumed and monetized. VideoElephant, a burgeoning entity in the Free Ad-Supported Streaming Television (FAST) sector, exemplifies this dynamic environment. Leveraging its extensive background in online video content licensing, VideoElephant has embarked on an ambitious journey to launch its own FAST channels while also aiding others in navigating this complex space. The company recently celebrated the launch of its third owned and operated channel, Real Crime Uncovered, on TCLTV+ in North America. This true-crime-focused channel joins two other successful FAST channels from VideoElephant on TCLTV+, namely Beyond Paranormal and Travel Escapes. This expansion underscores the company’s strategic vision and its ability to tap into popular genres that captivate audiences.
Brian Cullinane, Chief Commercial Officer at VideoElephant, has articulated the company’s forward-looking plans, revealing intentions to launch an additional three to four channels within the next six to nine months. This aggressive expansion strategy highlights VideoElephant’s commitment to growing its footprint in the FAST sector. Catherine Zhang, Vice President of Content Service & Partnerships at TCLTV+, expressed her enthusiasm about the collaboration with VideoElephant, emphasizing the value of adding compelling genres like true crime to their lineup. This partnership not only enhances TCLTV+’s content offerings but also positions VideoElephant as a significant player in the streaming industry.
The true crime genre, in particular, has proven to be a potent draw for viewers, with Cullinane noting a steady increase in viewership each month as new programming is introduced. This trend reflects broader industry insights, where niche genres often find dedicated and passionate audiences. VideoElephant’s strategic focus on true crime and other engaging content categories underscores its ability to identify and capitalize on viewer preferences. Furthermore, the company’s distribution strategy extends beyond TCLTV+, with its channels also available on platforms like Sling’s Freestream, Plex, LocalNow, Vidaa channels, and Freecast. This multi-platform approach ensures that VideoElephant’s content reaches a diverse and expansive audience base.
Since the inception of its first two channels in 2023, VideoElephant has witnessed a double-digit increase in monthly viewership hours, a testament to the growing popularity and engagement of its content. The company’s expertise in licensing and distributing short-form online video content has been instrumental in building a vast library of over 5 million assets spanning various categories and genres. This extensive content repository not only fuels VideoElephant’s own channels but also supports other publishers who may lack sufficient video content production capabilities. Notable clients include prominent websites such as USA Today and MSN, which benefit from VideoElephant’s robust content offerings.
The genesis of VideoElephant’s venture into the streaming space can be traced back to 2018 when the company identified an opportunity to leverage its relationships with content owners and web publishers. As more screens became connected and streaming gained traction, VideoElephant positioned itself to capitalize on this shift. Cullinane’s vision of bringing content and ads to any connected screen underscores the company’s adaptive and forward-thinking approach. This adaptability is crucial in an industry characterized by rapid technological advancements and shifting consumer behaviors.
The rise of free ad-supported streaming platforms presents both opportunities and challenges for companies like VideoElephant. Recent research indicates that 66% of TV viewers now utilize FAST platforms on a monthly basis, highlighting the significant market potential. Major players such as Fox’s Tubi, Paramount’s Pluto TV, and Amazon’s Freevee dominate the landscape, setting high benchmarks for newcomers. However, VideoElephant’s unique value proposition lies in its ability to offer specialized and niche content that resonates with specific audience segments. This differentiation is key to standing out in a crowded market.
VideoElephant’s foray into the advertising business approximately 18 months ago has further diversified its revenue streams. By monetizing through an inventory split on the content they create, the company reduces its reliance on revenue-sharing models with streaming platforms. This strategic move not only enhances profitability but also provides greater control over ad placements and monetization strategies. Despite the competitive nature of the FAST space, VideoElephant identifies opportunities for niche genres to attract dedicated viewership, thereby carving out a distinct market position.
The US market alone hosts about 10-15 streaming platforms deemed essential for the success of a FAST channel. VideoElephant’s established partner connections facilitate meeting distribution requirements, ensuring broad content accessibility. While the competitive landscape intensifies, it simultaneously offers avenues for smaller content owners to showcase their material on television screens. This democratization of content distribution empowers diverse voices and enriches the streaming ecosystem with varied perspectives and storytelling styles.
Retail media networks are another burgeoning frontier in the digital advertising realm, with major retailers like Walgreens and Walmart emerging as pivotal players. As advertisers gear up for 2024, events like Brandweek provide invaluable platforms for industry leaders to share insights and innovations. The dominance of Amazon in retail media over the past decade is now being challenged by other retailers in the grocery and specialty categories. These developments signal a transformative phase in the advertising landscape, with US retail media ad spending projected to reach $54 billion this year. The proliferation of over 200 different retail media networks necessitates a comprehensive understanding of this complex ecosystem.
Adweek’s compilation of key retail media networks serves as a crucial resource for advertisers navigating this evolving terrain. The list, curated with input from experts, analysts, and retailers, underscores the importance of staying informed and adaptable. Retail media networks offer brands unique opportunities to engage consumers through targeted and contextual advertising strategies. Prominent networks include those operated by Walmart, Amazon, Target, and CVS, while regional grocers like H-E-B and Publix are gaining traction. For advertisers, prioritizing these networks can significantly enhance consumer reach and engagement, driving brand growth and visibility.
Roku’s recent third-quarter performance exemplifies the robust growth potential in the streaming industry. The company reported a 20% increase in revenue, reaching $912 million, driven by strong performance in content distribution, video advertising, and smart TV sales. Roku’s dominance in the smart TV market, with its OS being the top-selling TVOS in the US, underscores its market leadership. Despite challenges in the US ad market, Roku’s diversified advertiser demand sources and expanding partnerships have fueled significant growth in ad spending. Integration with over 30 programmatic partners and collaborations with brands like Spotify and Walmart highlight Roku’s strategic approach to enhancing ad monetization.
Roku’s user base continues to expand, with a net increase of 2.3 million active accounts in Q3, bringing the total to 75.8 million. Streaming hours also saw substantial growth, surpassing 100 billion hours on a trailing 12-month basis for the first time. The introduction of new platform features aimed at personalizing the streaming experience, such as favoriting and streamlined browsing, has further boosted user engagement. The Roku Channel, the company’s free ad-supported streaming service, continues to perform well, capturing over 1% of all TV streaming in September. Looking ahead, Roku remains cautious due to an uncertain macro environment and uneven ad market recovery, but its strategic initiatives position it well for sustained growth.
For mid-sized media companies, third-party streaming services like Viacom’s Pluto TV and Roku’s Roku Channel offer critical opportunities to enter the connected TV market. While major media conglomerates can rely on standalone streaming services, smaller companies often face challenges in attracting audiences to their own apps. Creating 24/7 linear channels on free, ad-supported services provides a viable solution, enabling these companies to generate short-term revenue while building a long-term audience base. Distributing linear channels on platforms like Pluto TV and Xumo has become increasingly popular, allowing mid-sized media companies to gain exposure and offset costs.