The switch away from broadcast linear TV is not synonymous with consumers turning their back on broadcaster content, however, and Ampere Analysis notes that broadcaster investment in their own VOD services has ensured they can still engage audiences who prefer to watch via streaming. “In fact, engagement with these broadcast-led video services has increased by 26% since Q1 2021,” the research company notes.

Ampere says it is far too early to write off linear TV, noting the stability of low-level viewing – characterised in its report as less than two hours per day. “This suggests that many Internet users still tune in for key live events such as sports, major reality TV shows and exclusive dramas. These content pillars should remain a key part of acquisition and commissioning strategies for linear broadcasters.”

The company concludes that there are opportunities for broadcasters to retain viewers through a mix of live and event content, and via enhancing broadcaster streaming offerings.

Minal Modha, Research Director at Ampere Analysis, says: “At first glance, the decline in linear TV viewing looks to be a worrying trend for broadcasters as their traditional audience begins to drift away. However, as the increased engagement with broadcast-led video services shows, if the linear channels can continue to adapt and provide a strong OTT offering for audiences switching from scheduled TV channels, they have an opportunity to retain them, albeit on a different medium.”

Other findings in the report show that:

• 19% of respondents in Q1 2021 where characterised as high linear TV viewers – those who watch at least four hours of broadcast TV daily. This figure was down to 15% in Q1 2023.
• The number of Internet users saying they watch 4+ hours of VOD content in a typical day is up from 58% in Q1 2021 to 62% in Q1 2023.
• Over half of Internet users say they watch more than four hours of streaming TV in a typical day.

Related content

How broadcasters increase their share-of-time in digital

The first approach is a greater focus on scripted content, with Towler arguing that BVOD (broadcaster VOD/streaming) services are underweight in this department when compared to SVODs (both for current catalogues and upcoming commissions).

She presented figures showing the proportion of UK SVOD and BVOD content catalogues that are scripted. Taken in January 2023 (from the Ampere service Ampere Analytics) these reveal that ITV has the highest proportion of scripted content among UK broadcaster streaming services, at 53%, but this is still lower than all the major SVODs.

The UK SVOD with the lowest proportion of scripted content is NOW, at 57%, while Disney+ leads with 84%. The Ampere Analysis figures show that My5 (the Channel 5 BVOD offer) has 23% scripted content, with All4 (from Channel 4) at 33% and BBC iPlayer at 45%.

Towler’s advice is that while scripted content is more expensive, it has higher engagement and better longevity. To support this, she offered the London audience a graph showing the average relative popularity of scripted vs unscripted titles in the months following release, using an Ampere Analysis Popularity Score that is a measure of relative consumer search activity levels on third-party sources such as Google and Wikipedia. This showed that scripted content begins life significantly more ‘popular’ than unscripted content and then increases that relative advantage dramatically in the months that follow.

The popularity data came from ‘Ampere Analytics, Ampere Commissioning’ (a service within Ampere Analysis) and covered the top 25 scripted titles and top 25 unscripted titles released by BBC, ITV, Channel 4 and Channel 5 for seasons released since 2018.

At launch, scripted content was around five times as popular as unscripted (based on the search activity), but at three months this was closer to 8x as popular, and at nine months it was in the region of 12 times as popular as unscripted.

With the cost of scripted content in mind, Towler demonstrated how the rate of growth for global content spend is slowing, but noted that co-commissions can be used to increase output. This is the second of her strategies to increase broadcaster share of digital viewing time.

She gave figures for the % of broadcaster scripted series that are co-commissions on a quarter-by-quarter basis. These showed regular fluctuations but a general downward trend.

For example, the highest peak for broadcaster scripted series co-commissions since Q2 2022 has been 11%, whereas there were peaks of 17% in Q2 2020 and 14% in Q1 2021. The most recent trough was 8% in Q3 2022, whereas previous troughs were 12% (e.g. Q3/Q4 2020) and 10% (e.g. Q3 2021 and Q1 2022).

Co-commissions are often among broadcasters’ most popular recent shows, Towler told the Connected TV World Summit gathering (once again using Ampere’s Popularity Score, and so based on relative consumer third-party search activity).

A diagram outlined the proportion of Top 50 popular titles in 2022 (in the UK) that were co-commissions (using the Top 50 across BBC, ITV, Channel 4 and Channel 5 – with the data again from ‘Ampere Analytics, Ampere Commissioning’). For all shows in the Top 50 during 2022, one-fifth were co-commissions. If you count only the newer content – the Top 50 shows in 2022 that were also released after 2020 – two-thirds were co-commissions.

“Co-commissions offer a cost-effective opportunity to increase the volume of premium scripted content in broadcasters’ slates,” Towler concluded.

Towler’s third suggestion is that broadcasters should take advantage of the fact that non-exclusive licensing is set to increase – meaning more studio titles will be available to license. She used HBO Max in the USA as an example, where the proportion of the catalogue that is exclusive was 80% in August 2022 but 75% in January 2023.

[The context, of course, is that when major international studios launched their direct-to-consumer ‘+’ services there was a general shift towards studios feeding their own streaming services with their own content – sometimes at the expense of third-party licensing. If studios are licensing more to third-parties again, broadcasters can boost their BVOD offer with the titles that become available.]

Towler also suggested that broadcasters can license their own content to (non-broadcaster) AVOD and FAST services to reach new audiences.

The fourth item on the ‘to-do’ list is to release more digital-first premieres, which Towler described as “key for transitioning viewers to the online platform.” Based on first-run series released in 2022, ITV is leading the way among UK broadcasters for BVOD premieres, with 7% of those first-runs going to the streaming service first. For Channel 4 the figure was 6%, with the BBC at 3%.

As well as getting linear viewers into streaming, first-run digital premieres will help draw in new audiences, she noted. Towler also advised that weekly releases on VOD help retain users and prolong engagement, compared to full-series drops.

The final part of Towler’s five-point plan is a focus on younger viewers. She had a graph showing that Netflix Originals skew younger than content on SVOD in general, and pointed out that these are backed by an aggressive social media strategy “that is key for engaging younger groups.”

Broadcasters could learn from Netflix in this regard. “A successful social media strategy across Instagram, TikTok and Snapchat can help engage this demographic,” Towler advised.

Whole sessions are devoted to answering these questions, and others explore how broadcasters can increase their share of digital viewing time, and what the expansion of SAVOD (Subscription with Advertising VOD, exemplified by Netflix Basic with Ads) and FAST means for the TV advertising market. Early confirmed speakers across the agenda include:

• Pedro Bandeira, Vice President Product and New Business, Europe, Deutsche Telekom
• Aušra Sidaravičienė, Group Chief Technical Officer, TV3 Group
• John Jelley, Senior Vice President, Product and UX, Peacock & International, D2C at NBCUniversal Media
• Ken Morse, Director of Application Delivery, Sky
• Pierre-Adrian Irlé, Head of Play Suisse, SRG SSR
• Jason Briggs, President and General Manager, RDK
• Mehmet Eroglu, Chief Commercial Officer, Foxxum
• Gary Woolf, EVP Strategic Development, All3Media International
• Marcos Milanez, EU General Manager, Rakuten TV
• Ivars Lubāns, Head of Product, Go3, TV3 Group
• Akhila Khanna, VP, Partnerships and Business Development, UK, Paramount.

You can see an up-to-date list of publicly announced speakers here.

There is a session titled ‘Driving D2C and SVOD growth’, focusing on how channel groups, studios and SVOD providers maximise their potential audience reach, convert app availability into paying customers, maintain attention in an increasingly competitive marketplace, guarantee win-win relationships with CE/OS/STB device platform providers, and expand market share during a cost-of-living crisis.

As part of a four-session advertising stream on Tuesday March 21, leaders who are driving the advanced advertising transformation will explore how we maximise the value of free connected TV, and how we make TV a better product for advertisers (spanning the latest thinking on making cross-platform buying easier, improving cross-platform measurement, and attributing TV exposure to business outcomes, among other things.

A session is devoted to ‘Preparing for a larger addressable TV universe’, exploring the challenges (as well as opportunities) as the number of addressable-enabled platforms and homes increases – acknowledging the fact that free-to-air platforms are increasingly ready to join the party, adding to Pay TV and streaming footprints.

The ‘Win-wins in the Television OS marketplace’ session focuses on how TV-OS providers, television set OEMs and content owners work together to increase total household reach, audience engagement and ongoing revenue opportunities for streaming TV. This includes  a look at the Pay TV operator Smart TV model (pioneered by Sky Glass), the role of independent OS/UX providers, and how global OS/UX providers in the CTV/Smart TV space differentiate themselves.

Connected TV World Summit is renowned for delivering smart new thinking and research, and many of the world’s leading analysts are gathering to explore these mission-critical issues:

• ‘The subscription economy in an inflationary era’ – Tim Mulligan, Executive Vice President and Research Director, MIDiA Research
• ‘Content and windowing strategies in the D2C market’ – Jack Davison, Executive Vice President, 3Vision
• ‘The impact of Netflix and TikTok in video advertising’ – Maria Rua Aguete, Senior Director, Media and Entertainment, Omdia
• ‘How broadcasters increase their share-of-time in digital’ – Lottie Towler, Research Manager, Ampere Analysis
• ‘The future of free-to-air aggregation’ – Richard Broughton, Executive Director, Ampere Analysis
• ‘Decarbonising TMT’ – Alice Enders, Director of Research, Enders Analysis
• ‘Technology choices shaping the sports experience of the future’ – Tom Morrod, Research Director & Co-Founder, Caretta Research
• ‘Media & Entertainment opportunities in the metaverse’ – Joseph Teasdale, Head of Tech, Enders Analysis.

‘Delivering an experience: STB & Operator App’ is a session that explores two parallel and closely entwined technology roadmaps: the next-generation TV experience delivered via a set-top box, and operator/aggregator services enabled directly on a television without an STB, whether in the form of ‘Operator as an App’ on a third-party television brand or embedded into an operator-produced television set (as with the pioneering Sky Glass model).

In ‘Cementing the consumer love affair with TV’, 90 minutes are devoted to best practice and global innovation in content discovery. Ampere Analysis is leading a special session dedicated to the future of televised sport, focusing on rights and distribution strategy, while there are parallel sessions devoted to beating the sports streaming pirates and building the sports streaming networks of the future.

Connected TV World Summit has moved to a new venue: Convene, 22 Bishopsgate – London’s second tallest building, next to the Gherkin and minutes from Tower 42. For the first time, the organisers (disclaimer – Videonet is owned by Adwanted Group, which produces Connected TV World Summit) are hosting some Masterclasses, making use of ultra-modern networking and meeting spaces to dig deeper into narrow-focus topics, led by experts in the field.

Nathalie Lethbridge, Founder and Principal Advisor, Atonik Digital, leads the FAST Masterclass, and the consulting/research firm MTM leads the Customer Retention and Acquisition Masterclass. There is a special breakfast devoted to how we decarbonise the television value-chain while ensuring the industry ends the process as large as it started.

The organisers are predicting 100+ senior-level speakers and 600+ (unique) delegates over the two days.

You can find more details about Connected TV World Summit 2023, here.

The registration for this event can be found here.

Connected TV World Summit is produced by Adwanted Events (formerly called Mediatel Events). Adwanted Events also delivers The Future of TV Advertising Global (also with Sydney and Canada editions), The Future of Media, The Future of Brands and The Future of Audio, among others.

The research involved an econometric analysis (conducted with Gain Theory) of GroupM’s data set – which represents £1.1B in media investment – assessed through marketing mix modelling. The study shows that BVOD registers a slightly higher short term ROI index than for linear TV – 1.27 compared to 1.0. Hall also revealed that linear TV drives a much higher percentage of sales volume than BVOD – 47% compared to 3% – due to its significantly larger reach.

Hill said the research conducted by Thinkbox represents the most comprehensive exploration of BVOD and its role in media to date. In addition to the econometric analysis of GroupM’s data set, to understand the incremental reach BVOD provides, the study (conducted with PwC) evaluated 1,259 campaigns using BVOD measured by CFlight, with ad server data coming from ITV, Channel 4 and Sky.

Hill remarked: “One thing we weren’t expecting is that it is very important to plan BVOD across longer periods of time, as reach of VOD builds slower than linear TV. Rather than mapping BVOD against your linear campaign you should try to map it across a longer period of time to give you a better chance of accessing light viewers.”

The study found that BVOD incremental reach increases by three times for campaigns that have a 30-50 day duration when compared to those shorter than 30 days. Additionally, Hill recommended that advertisers should be “buying across all sales points and genres and spreading [their] inventory as wide as possible” to maximise reach on BVOD. The study shows that campaigns delivered across six to ten genres yield up to two times the incremental reach compared to those delivered across one to five genres.

The study also sought to assess the impact that device, platform and ad creatives have on advertising engagement. In order to explore this question, the body conducted an ethnographic and videographic study of video ad experience for 30 households.

One takeaway from the research is the important of the concept of ‘value-exchange’. Hall said: “For viewers, there is an understood and accepted value exchanged between consuming TV content and watching advertising. That comes from years of linear TV. When the value-exchange breaks down and the content is not good enough, then advertising is actively ignored and avoided.”

Another key finding is that viewers react negatively to ads disguised as content. He said: “This is a common problem on TikTok at the moment. People will be watching a video on TikTok without realising its an ad, then realise and feel frustrated.”

Hall also revealed that viewers have a higher tolerance for ads not being relevant to them on a shared screen as compared to a personal screen. This is because viewers assume that ads on a shared screen will not be targeted (despite the fact, as Hall noted, that ads can be targeted on shared screens and more often are.) On personal devices, viewers expect ads to be more targeted and relevant to them, and are frustrated when they are not.

However, Hall stressed the salience of creatives: “If you can make great creatives that resonate, that completely overpowers any need for relevance. This allows TV to play across all categories, for people who are in market and for people who are out of market. That’s the essence of TV that makes it such a powerful brand builder and also a powerful sales tool for all types of business.”

According to Thinkbox, BVOD now account for 6% of all video viewing, with BVOD revenues forecast to reach just over £800m this year.

The rise in revenues occurred despite the weekly reach of PSB channel declining four percentage points, to 76% from 2019. Ofcom states that only 47% of 16-24 year-olds watch at least 15 consecutive minutes of the PSB channels in an average week.

UK commercial broadcast revenues more broadly rose strongly in 2021, reaching £11.3B – a 100.6% increase over the previous year, and 4.5% higher than in 2019.

Ofcom reports that the average viewing time for Live TV was 144 minutes per day, while viewing time for SVOD services was 58 minutes, and BVOD, 15 minutes. The average viewing time on YouTube (not on TV) was 43 minutes.

While SVOD viewing time fell by 6% in 2021, Ofcom notes that this caused only a small decline in its share of all video viewing – decreasing from 19% to 18%. By contrast, BVOD viewing time actually rose by 3 minutes per person, per day “partially offsetting the declines for other forms of broadcast TV viewing.”

Ofcom reports that SVOD services like Netflix and Disney+ were used by 67% of UK households by Q2 2022 (representing a 1% decline from the previous quarter.) Despite this small decline, Ofcom notes that “a combination of price rises and increases in subscriber numbers drove strong revenue growth for the SVOD sector in 2021, with the 27% year-on-year increase, to £2.7bn, almost matching the bumper 28% growth in 2020.”

Richard Halton, Director, UK, Roku, said: “The findings of Ofcom’s report clearly shows that the trend towards TV streaming continues, reinforcing our view that all TV will be streamed. Whether through the growth in PSB on-demand services or the continued popularity of global streaming services. Given that over 80% of the country state that they’ve used a PSB on-demand service recently, it also demonstrates the worth that consumers place in our national broadcasters.

“Ad-supported services provide great value to consumers and have an increasingly important role to play in their TV streaming mix.”

Importantly he notes that, when viewed from an ‘all-adults’ point of view (rather than just 16-34s), dedicating 10% of campaign budgets to BVOD “doesn’t drive a cost-effective response”. Although in this instance, while the effective reach looks similar to a 100% linear campaign, the profile of this type of reach is comprised of a much younger audience.

Hill also reviewed the inflation TV pricing underwent last year and across different age groups, remarking that the rise in average CPT for adults had been “reasonable” – from just over £4 to almost £6 between 2020 and 2021, according to BARB and AA/WARC data. In contrast, for 16-34s, CPT had risen from £35 to around £52. Hill believes the upshot of this dramatic rise in CPT for 16-34 audiences is that BVOD may become a “starting point” for advertisers’ media plans, since BVOD pricing has been “pretty static” (hovering around £25-35).

Hill emphasised that, while TV is getting more expensive, inflation is not a challenge for TV alone. Using AA/WARC, BARB and Comscore data, Thinkbox estimates that the average cost per thousand for a 30-second TV ad was £7 in 2021, while the cost for a YouTube ad was approximately £10. Other online video ads cost almost £90 last year according to Thinkbox, due to the fact that ads on these platforms are “very easily skipped”.

Hill said: “We need to think about the value of TV rather than just the fact that its price is changing because of a supply-demand dynamic. Cost-effective reach remains a priority for media planners.”

Reviewing BARB data, Hill also showed that 65% of UK adults can “easily be reached through linear TV”, with this proportion of the population consuming somewhere between 50-501+ TV ads a week through traditional broadcasting. Beyond this 65% it becomes harder to reach audiences, Hill remarked, with 8.7 million viewers watching linear but consuming less than 50 ads per week.

Hill outlined how UK TV ad spend has seen significant increases across different sectors and particularly from online businesses. According to AA/WARC estimates for 2021, TV experienced a surge in ad spend from food delivery/food subscription businesses (such as Just Eat, Uber Eats etc.) with total TV ad spend from this sector reaching £127m – a rise of 184% (£82m). Similarly, the online second-hand car sector (which includes companies such as webuyanycar.com and Cazoo) spent £74m last year on TV – an increase of 222% (£51m). Another sector which increased its TV ad spend heavily was the market for streaming services. Across 2021, streaming service providers spent £52m on TV, up from £21m in the previous year.

He said: “[During the pandemic] a whole range of micro online businesses were using TV to grow. They’re using it because it is a shop window for their brands. They might not have a physical presence and so need to be front-of-mind [among consumers]. They have a need to scale quickly and TV is good at this because you can speak to lots of people in a very short time.”

An important benefit of advertising on TV Hill highlighted is not just that it drives traffic, but also that “the people coming to your business when you’re advertising on TV are more likely to buy.”

He reviewed the econometric breakdown of a campaign from an advertiser in the furniture industry. When aggregate exposure was between 0 and 10m weekly TV impacts, the conversion rate for viewers was just over 0.8%, while when aggregate exposure was between 60 to 70m weekly TV impacts, the conversion rate rose significantly to almost 1.8%.

“The IP-only homes tend to be VOD-first and especially SVOD-first, and Pluto TV complements this. Pluto TV is almost tracking SVOD penetration and consumption. In the U.S., about 80% of Pluto TV users are also paid streaming users and we see Pluto TV and Paramount Plus being highly complementary, and we see Pluto TV and My5 playing in distinct parts of the [free] market, albeit with overlap.”

Pluto TV and My5 differ in another important respect: while My5 is, like all BVOD services, the best of the output from the broadcaster, in streamed form, Pluto TV is an aggregation of content from multiple content providers, so has a large third-party input. No single channel dominates consumption on Pluto TV. Fahy revealed that no channel has more than 6% of viewing share-of-time on the platform, with each of the streamed linear channels (FAST channels) deliberately focused on a specific programme, genre or cohort.

“Pluto TV is good at taking known IP (intellectual property) and [content] franchises that might not be recent and may have seen their best days five or seven years ago and puts them onto a platform and packages them in a fun and creative way and gets them into those homes that have ditched a broadcast connection,” Fahy explains. “It is a great way to build back some visibility that is perhaps lost on linear broadcast, and it is a chance to monetise content that content owners have invested heavily into, but which is sitting on the shelf.”

Reflecting its focus on a linear experience, Pluto TV also mirrors the typical advertising model seen on broadcast TV – which means you have ad breaks every X minutes and if someone joins a Pluto TV streamed linear channel, they are not presented immediately with pre-roll ads but instead see whatever is playing out at the time. If the last ad break has just finished, they will not see an ad until the next scheduled ad break.

The openness of Pluto TV is key to its business and go-to-market model. It is viewed by Paramount Global as a platform, and not a platform for Paramount content but one where multiple content owners live, although it does host Paramount programming within that diversity (Channel 5 has created five branded FAST channels on Pluto TV this year, for example). Fahy made it clear that his company welcomes other broadcasters coming onboard, “if they want to get into FAST”. He added: “They can come and partner with us because we’ve done lots of the hard work, investing over the years in the platform, the ad-tech and integration with device partners. This is a key calling card for Pluto TV.”

Paramount Plus is focused on Paramount’s own content, including a tranche of Originals. But what does unite all three services is a commitment to a muti-genre content offering – and Paramount Plus is going to arrive in the UK with feature films, premium scripted, reality, comedy, kids and music, among other things (and anything between 8,000 and 10,000 hours of content). Another common denominator in the UK is ad sales representation: Sky Media sells ads on behalf of Paramount across its broadcast TV channels, My5 and Pluto TV (although Pluto TV is also sold programmatically via other partners).

The Connected TV Summit discussion took a closer look at Paramount Plus and it’s go-to-market strategy. This will be made available via Pay TV onboarding and indeed hard bundling – with the new SVOD service bundled with Sky Cinema in the UK, for example. The service will be taken to Germany and Italy in partnership with Sky, too, and into France in collaboration with Canal Plus. These Pay TV operator distribution partnerships will help drive scale.

“We have always been very partnerships-focused, and there are lots of advantages to working with partners [in the streaming space] – it lowers the cost of acquisition because you are sharing the marketing, and churn is lower on these [partner Pay TV] platforms. There is lots to like about it [distribution partnerships],” Fahy explained.

Paramount is focused on the non-Pay TV homes market for Paramount Plus, too (of course), and will harness partnerships with the well-known connected TV and Smart TV device platforms to get the app carried and surfaced in this ‘pure D2C’ environment. And as Fahy points out, “One of the great things about Paramount Plus is that it brings the richness of content that was previously in the domain of Pay TV and is now packaged for the first time as a standalone offer.”

Asked by interviewer Richard Broughton, Research Director at Ampere Analysis, how the media group intends to reach its target of 100m global streaming subscribers by 2024 [a target shared in February this year, and raised from the 65-75M that Paramount forecast in 2021], Fahy pointed to how the company “is leveraging the whole business into streaming, and leveraging streaming back into our business”. Concrete examples of how content is exploited in more windows include Sonic the Hedgehog 2, whose theatrical release generated significant streaming volumes for the original Sonic story. Now a forthcoming Sonic 3 movie will be accompanied by a kid’s animated series that will run on Nickelodeon across linear TV and then go into Paramount Plus.

Franchise invigoration (another example given is the launch of a kid’s animated series for Transformers) and Originals are key parts of the Paramount Global growth strategy, and cross-promotion is viewed as a natural advantage when you operate across broadcast TV and streaming, both paid and free. “We have this flywheel from theatrical to linear and streaming, and back the other way,” Fahy declared. We don’t see our current business as an anchor to streaming but as a lever.”

Some (though not all) of the major international studio groups are going all-in on their owned-and-operated (and direct-to-consumer) ‘Plus’ apps, hoping they will become the home for digital viewing of their content. And broadcasters everywhere have been investing heavily in their ‘Player’ services, including deeper catalogues that help them evolve from catch-up services to destinations in their own right. But speaking at Connected TV World Summit three weeks ago, Jonathan Lewis, Head of Commercial Innovation & Partners at Channel 4 Television, explained that Channel 4 was taking a balanced approach to digital distribution.

Focusing on the YouTube deal in particular, he said: “We don’t think this is going to cannibalise audiences on our owned-and-operated platforms. TV is getting older, and YouTube is still the youngest social platform, and big-screen viewing on YouTube is skyrocketing and that is really important to us because people want to watch our content on the big screen.

“We view YouTube as a distribution platform in the same way that we view Sky Glass and other connected TV environments. This is a big pivot [to embrace long-form distribution on YouTube] but the YouTube strategy helps us reach younger audiences and super-charge our digital growth strategy and diversify revenues. It is a significant step in terms of delivering on our Future4 strategy [the high-level strategy C4 announced two years ago to prioritise streaming and grow digital’s share of revenue].”

The YouTube deal applies to the UK and Republic of Ireland and will see Channel 4 making an ever-growing catalogue of content available via the service – reaching around 500 hours next month and something like 1,000 hours by the end of this year. And this is part of a wider digital distribution focus that includes social platforms like Snap, Facebook and TikTok – with TikTok viewed as a natural home for 2–3-minute clips of the broadcaster’s output, which includes often irreverent comedy.

Asked why Channel 4 does not want to ‘force’ streaming viewers to come to its streaming service, All4, to see content [a theoretical possibility in the streaming space], Lewis declared: “We will fish where the fish are.”

He added: “We are doing both [D2C via owned-and-operated, and third-party streaming distribution partnerships]. We are trying to appeal to an audience that we are pretty confident are not going to come to All4. That is why we are going to start building a big presence on TikTok, because we recognised that the format, and the types of content you find on TikTok, won’t work as a 30-minute show [within All4].”

Lewis believes it is important for the Channel 4 brand to be seen, including by people that may not come to the owned-and-operated app. Focusing on TikTok again, he said: “We need to be on that platform and talking to that audience because we want 16-24 year-olds to have an empathy with Channel 4 as a brand, and a sense of what our brand means, and they are not going to get that if we just sit within our walled garden expecting them to come to us.”

Channel 4 views these third-party streaming services / social platforms, and also long-established partners like Sky, as key elements in the future digital distribution strategy. “We were a launch partner on Sky Glass,” Lewis pointed out, referring to Sky’s Pay TV operator created/branded retail Smart TV that ditches satellite tuners and relies on streaming. “We want to offer our service to users where they want to consume it. We see IP [digital/streaming] as a TV delivery that allows us to hold onto audiences, grow them where we can, and in particular grow younger audiences.”

Lewis emphasised how third-party content distribution complements the owned-and-operated environment – observing that when Channel 4 signs a syndication deal for Netflix to show archive programming, viewing of the more recent episodes increases on All4. He cited the [outrageous teen comedy] ‘The Inbetweeners’ as one example. “There is a halo effect.”

The deal with YouTube does not cover international markets but Channel 4 is looking at how it can increase non-UK revenues and it was clear that if the rights agreements could be agreed with the Indie producers (who retain their rights on Channel 4 broadcasted content) then a wider YouTube deal could at least be considered. The same applies for potential FAST channels, although Lewis acknowledged that the broadcaster would need to convince the programme rights holders that Channel 4 curation for international streaming was their best option.

One key point about the UK YouTube deal is that Channel 4 (whose 4Sales is one of the major UK television sales houses) will sell the advertising that appears. “We will have the relationship with the advertisers. We have great relationships with them already and now we can offer a reach extender into younger audiences off-platform.” This direct Channel 4 sell means advertises can also buy directly against content (rather than buying only against an audience).

ITVX will replace ITV Hub and ITV Hub+. The plan is for ITVX to launch in time for the FIFA World Cup finals, which start in late November. ITV wants to double the number of monthly active users (MAU) on ITV streaming over the next five years, but another key KPI is total consumption, with Kelly Williams, Managing Director, Commercial, at ITV, looking to “double or even triple consumption over the next five years.”

ITVX is effectively a new build streaming service – it is based on completely new technical and UX architecture, underpinned by “a significantly enhanced data capability.” Greater personalisation will be one of the most obvious consumer-facing benefits. Deep Bagchee, Chief Product Officer at ITV, promised a destination for discovering content that includes a much richer visual experience. “The more you watch, the more accurately ITVX gets to know you so we can personalise the product experience,” he explained. Children can create their own viewing profiles, in an example of the personalised UX features.

There is scope for dedicated show/events spaces within the new user interface and the FIFA World Cup Quatar will provide an early example of what is possible, where ITVX viewers will find World Cup related content including interview highlights and companion shows. The World Cup will also be the perfect introduction for a service that is partly designed to bring lighter TV viewers to ITV and then persuade them to stay. In the words of Williams: “People will come in and think, ‘This is a better and stronger service proposition’.”

The launch of ITVX is part of ITV’s previously announced strategy to increase its share of on-demand and streamed viewing while maintaining super-scale live audiences for advertisers – with the linear broadcast channels still central to the share-of-time and share-of-ad-revenue ambitions. The company confirmed: “It has become increasingly clear this year that live channels are incredibly important, whether people are watching broadcast or streaming versions. That will be a significant differentiator [for ITV and ITVX]. Viewers are increasingly choosing to watch live TV in a streaming environment,” said Williams during a briefing to media buyers.

ITV has promised an enhanced live experience via ITVX that includes better discoverability – partly driven by better search engine optimisation and by social sharing of big, live television moments.

Chris Goldson, Director of Commercial Marketing and Pitch Development at ITV, added: “We will be doubling down on live streaming as a differentiator, harnessing daytime, soaps, news and sport to ensure we continue to be the biggest game in town for those valuable mass audiences.”

The company will also leverage its own deep library of programming to feed series-stacking and boxset binge-viewing habits in the VOD space, and ITVX will provide a casual linear zapping experience for streamers via FAST channels (as well as standard linear channels). The FAST channels will be a themed curation of shows and other content, played out on a linear schedule. ITV says the common denominator for what goes in one of its FAST channels could be genre, an actor (e.g. you could have a David Tennant themed channel), cultural moments and calendar events, or they can be based upon a specific programme – with The Only Way is Essex, The Chase and Real Housewives offered as examples.

“FAST channels are big in the U.S., and we think we can be very strong in this space,” Williams declared. There will be 20 FAST channels on ITVX at launch and the broadcaster likened their curation to ITV putting together a Spotify playlist that they think their viewers will love. The FAST channels can be added and removed with ease, based on viewer demand, harnessing digital data smarts. The broadcaster aims to introduce a new FAST channel to ITVX every week.

ITV has also announced a significant increase in content investment, taking spend from £1.1 billion to £1.35bn per year, with streaming prioritised. The extra money will be used to attract harder-to-reach, [for TV advertisers] lighter TV viewers to the broadcaster. In total, ITVX will have 15,000 hours of content at launch versus the 4,000 available on ITV Hub today. ITV will welcome third-party content into ITVX. All of this justifies the broadcaster’s assertion that ITVX will be a streaming destination [rather than a catch-up service].

Goldson talked about bonfires and fireworks within the programme mix, with ‘bonfires’ being the always-on programming that keeps people coming back, underpinned by a wider choice of on-demand titles. ‘Fireworks’ are the programming launches, exclusives, series drops and “special moments” that create a big bang. The ‘bonfires’ will include a collection of feature films, with 50 films available on the service at any one time, regularly refreshed. ITV named some of its partners, including Warner Bros, Disney, NBCU, Sony and StudioCanal. “We expect to show 500 films for free in the first year alone,” Goldson revealed. “We will have extremely well-known franchises in their entirety, for free, in one place for the first time.”

ITV used the launch event to stress that ITVX is first-and-foremost an ad-funded service and that ITV’s future is all about free-to-air television. Because the service will include an ad-free subscription tier under the same roof – bringing what is currently ITV Hub+ into the same integrated platform – and because ITV at the same time announced that a lot of content will premiere in ITVX up to nine months before it goes onto broadcast linear TV, some assumptions were made that ITV was shifting further into the paid domain as a strategic objective. In fact, as you can read here, the new exclusive streaming windows apply to the free-to-view tier on ITVX as well as the paid version. The strategic shift embedded in the new windowing is not from free to paid, but from broadcast towards streaming.

One of the first ITVX exclusive premieres, this autumn, will be the flagship four-part drama Litvinenko, with David Tennant playing the lead role of Alexander Litvinenko, the former Russian Federal Security Services and KGB officer who was murdered in November 2006 by polonium poisoning, creating a security and diplomatic crisis.

As part of the new windowing strategy, every episode of a new series will also be dropped onto ITVX as soon as the programme airs on ITV broadcast television (if it is not premiered ahead of broadcast). “Viewers could watch all the remaining episodes that same night,” Goldson pointed out. “We tested this with five dramas last year and it brought in new viewers and added incremental viewing, so we are going to do it with 20 series in Year One of ITVX.”

Speaking about the strategy to give ITVX a 6-9 month exclusivity period on a significant amount of drama and documentary programming, Goldson said this content will receive a second surge of viewing when it is finally unleashed on the linear broadcast channels. “This is an opportunity to bring in new and younger audiences with refreshingly different types of ITV content as we are unshackled from the linear schedule,” he declared. Streaming-first Sci-Fi, Indie and Documentary programming is expected to bring new viewers to ITV.

The paid tier on ITVX will include content that is exclusive to subscribers plus the full BritBox experience including programming from BBC, Channel 4 and Channel 5 (the UK’s other major ‘terrestrial’ broadcasters).

Rhys McLachlan, Director of Advanced Advertising at ITV, doubled down on the message that ITV is all about ad-supported television. “ITVX is an AVOD-led proposition; it is advertising funded front-and-centre. There is a subscription tier, with ITV Hub+ and BritBox being integrated into ITVX, but if you de-duplicate those subscribers, we have about one million subscribers. We have modest ambitions in this [subscription] area.”

Emphasising this point, Williams said ITV is “perhaps looking to double the subscription base over five years.” He declared: “It is not true that we are looking to take on Netflix and Amazon – this is about being a premium AVOD service. The premium tier is a small add-on.”

It is worth noting that ITV Hub+ – the current ad-free subscription streaming offer from ITV – is only ad-free for on-demand content, with live programming still carrying ads. This model will be carried over to the subscription ad-free tier of ITVX.

Speaking to advertisers and agencies during the ITVX briefing, Kate Waters, Director of Client Strategy at ITV, emphasised that ITV serves the whole country and [for the purposes of market research] the broadcaster has now defined the national audience into various viewing types, including those primarily looking for tentpole and flagship live entertainment and drama, and those described as VOD-first consumers who are looking for content that drives social conversation, and who skew younger. Another group are later adopters of digital technology who tend to also focus on British content, and yet another group are the streaming subscription stackers who are looking for quality rather than quantity of content. ITVX is designed to serve everyone.

McLachlan said ITVX will increase ITV’s addressable market, increasing the breadth and diversity of the audience as well as encouraging more people to watch more content. ITVX advertising will be 100% traded through Planet V. Advertisers can expect all the targeting options they are used to within ITV Hub, but McLachlan promised that targeting will also be turbo-charged, with more permutations possible by taking content multiplied by audience multiplied by context.

ITV AdLabs, ITV’s new strategy, tech and process innovation initiative, is currently developing an ACR-based solution that will read programme metadata to understand what is happening inside shows or films not just at programme-level but at scene-level. McLachlan gave the example of knowing when it is family mealtime within a show. It is this kind of context that he is referring to in the expanded content-audience-context planning options.

ITVX targeting is backed by privacy compliant data from ITV’s 33 million registered streaming users and ITV will use the new service launch to actively engage with consumers to understand more about them. This will be achieved using a fair exchange of value in a GDPR compliant way.

Asked about the likely ad loads on ITVX, McLachlan said there are no hard-and-fast rules, “and as the proposition grows, we will be much more agile in how we schedule breaks.”

In terms of app distribution, the expectation is that ITVX will appear on any platform where you find ITV Hub today.

Photo: ITV has concluded a wide ranging ITVX content deal with WarnerMedia International Television Distribution for programmes including UK premieres of The Sex Lives of College Girls (featured) and All American. More third-party content deals like this are anticipated.

More around this subject

Interested in the future of free-to-view television, the evolution of content strategies (including windowing) and (subscription and ad-supported) streaming strategies? Then check out Connected TV World Summit in May, which also has three sessions dedicated to advanced TV advertising. Full details here.

Importantly, the company announced a digital-first windowing strategy that will see much of its new content appearing first on ITVX before making its way to ITV broadcast channels not days later, or weeks later, but months later (6-9 months later for a wealth of dramas, for example). All the drama and comedy commissions, and most reality series, will also be dropped onto ITVX as a full series or boxset as soon as the first episode has aired on linear (broadcast) TV.

Viewers are not being forced into a subscription tier to see this content early – the shows are going into the free ad-supported version of ITVX, leaving the core value proposition for the subscription tier as the absence of advertising and a wider content offer that will include shows currently found in BritBox (the subscription streaming joint venture with the BBC) and partner SVODs yet to be announced.

ITV plans to scale the content offer on ITV Hub ahead of the transition to ITVX – currently the free BVOD service has 4,000 hours of content and ITVX will have 15,000 hours at launch. Another key innovation within the new service will be the presence of specially curated and themed FAST (free ad-supported TV) channels, including ‘Hell’s Kitchen US’, ‘The Chase’ (harnessing the popular quiz show) and ‘90s Favourites’.

The FAST channels will evolve and “pop-up” to align with viewer preferences and popularity, with those curation decisions drawing upon the data ITV has available via its digital services. ITV is promising a new themed channel every week of the year! ITVX contains the classic ITV linear channels, of course.

FAST channels featuring library content are becoming part of the staple diet on aggregated content offers on Smart TV platforms. Indeed, ITV Studios just announced a deal with Samsung TV Plus to distribute FAST channels in the UK and other European markets like Italy and Germany, as well.

With its larger catalogue, ITVX is going to be home to a variety of past classics (like ‘Brideshead Revisited’) to current favourites like ‘Love Island’. A wide selection of popular U.S. series is also promised, with WarnerMedia International Television Distribution announced as the first content partner for this endeavour, with more to come. This deal will include UK premieres (on ITVX) for ‘The Sex Lives of College Girls’ and ‘All American’, among other shows.

ITV says blockbuster films will also be part of the service. “ITVX intends to stream 500 films for free in its first year alone, with a constantly refreshed selection of titles and 150 films on the service at any one time,” the company said last week. Major live events like sport (including the FIFA World Cup) and tentpole linear shows like ‘I’m A Celebrity’ or the ‘Love Island Final’, will be simulcast on broadcast TV and ITVX.

ITV has emphasised the importance of this service housing both an ad-supported free option and a subscription funded offer under the same roof. “It is the UK’s first integrated AVOD/SVOD platform and will be the first streaming service in the UK to offer viewers the flexibility to access free content with ads and ad-free paid subscription, all in one place,” the company declares. The subscription tier pricing will be revealed later this year.

Carolyn McCall, ITV’s Chief Executive, has made it clear that ITVX should be viewed as part of the broadcaster’s digital acceleration. “We are supercharging our streaming business, fundamentally shifting our focus to think digital-first, as well as optimising our broadcast channels, by continuing to attract unrivalled mass audiences.

“In doing so we are responding to changing viewing habits, but also the evolving needs from our advertisers. This will enable ITV to continue to be both commercial viewers and advertisers’ first choice.”

Kevin Lygo, ITV’s Managing Director of Media and Entertainment, confirms: “Our broadcast channels are very important to what we do, and we are still focused on delivering what ITV does better than anyone in commercial TV: creating programmes that bring audiences together, in-the-moment, in their millions, for that shared viewing, scheduled TV experience.

“However, we know we have to deliver our programmes to as many people as possible in all the ways they want to watch them and going forward viewers will now see a wide array of shows premiering first on ITVX, which is the cornerstone of ITV’s digital acceleration.”

Editor’s Comment

This is BVOD for the 2020s – the answer you might expect from one of the world’s most important content and broadcast groups – a large, multi-genre offering combining vast boxsets, standard linear channels, themed FAST channels and live events like sport, all available as a free or paid version, and making full use of the enormous intellectual property ITV owns.

So, if this is the ‘answer’, what is the question? The question is how broadcasters grow their digital share-of-time and therefore guarantee their total-share-of-time as more people stream more of the time, especially when faced with the arrival of global studio direct-to-consumer services like Paramount, Disney+ and Peacock on top of the global SVODs like Netflix and Amazon Prime Video.

The change in ITV windowing is the concrete evidence that ITV is thinking digital-first. If you put your big new shows into your BVOD service up to nine months ahead of their broadcast TV debut, you are encouraging people to migrate to digital. It is worth stressing: these shows are going early into the free window as well as the pay one, so this is not about encouraging a subset of the free-to-view broadcast audience into paid streaming instead – it will encourage free-to-view broadcast viewers into free-to-view streaming (even if some switch to paid).

When you do that, as a leading commercial broadcaster with large ad revenues, you must be sure you can fully monetise large-scale audiences in streaming. ITV has become an advanced advertising leader over the last few years and Planet V is one of the hero ‘technologies’ behind that journey, giving the company full control, in a broadcast-friendly way, of programmatic sales as well as direct-sold advertising across its streamed content.

More on related subjects

Interested in the future of free-to-view television, the evolution of content strategies (including windowing) and (subscription and ad-supported) streaming strategies? Then check out Connected TV World Summit in May, which also has three sessions dedicated to advanced TV advertising. Full details here.