While the biggest entertainment companies are caught in an SVOD fight to the death, viewership numbers suggest audiences are spending more time with free streamers. Industry watchers have noted the increasing rise of the free Tubi service as a noteworthy success. According to Nielsen, people spent more time watching Tubi than Peacock, Max, or Paramount+ last month.
The success isn’t just because Tubi is free. Pluto TV is also free, but Nielsen reports it only pulled half the viewership of Tubi in March.
So why is Tubi white hot these days?
CEO Anjali Sud explained the streamer’s strategy on the podcast “The Town.” Tubi isn’t chasing the same audiences as Netflix or Hulu. “Forty percent of our audience are not on other traditional streamers,” Sud said.
The company is planning to focus more on underserved audiences moving forward. “You are going to see us use original (movies and shows) to speak to the next generation,” Sud said. “We’re going to focus on younger, female-forward diverse audiences, the audiences that don’t feel as represented in sort of the prestige content you see today.”
Tubi is also working to serve Black audiences. “That is a community and a fandom that has felt not as well served by traditional Hollywood,” Sud said. “If you want to be culturally relevant, this is a really important community to engage.”
While Tubi is not currently profitable, Sud says it can be “when it chooses to be.” Tubi’s ad breaks are often shorter and less frequent than other services. If it increased the length or frequency of those commercials, the revenue may go up, but the user engagement could suffer. For now, audiences seem content with the ad load.
“The path to profitability… comes from growing and actually just better monetizing our audience and our engagement and continuing to build that audience and engagement. It doesn’t come from cost-cutting and that’s a very different place to be and it gives you the freedom to prioritize your customer,” Sud said.
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When asked about Freevee, Sud suggested Amazon may eventually fold that service into Prime Video, though it may not be a formal transition. Prime Video users already see Freevee content alongside the Prime Video library, leading to some confusion. Prime Video made its standard tier ad-supported in January.
You can listen to the full interview with Tubi CEO Anjali Sud below.