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Insight of the Day: New Ad-Supported Streaming Options See Little Backlash, Study Finds

Key Findings:

  • Growth of Ad-Supported: Consumers using ONLY ad-supported streaming services jumped from 8% to 18% of the market after Amazon Prime Video's ad-supported tier launch.

  • Ad-Free Decline:  Consumers relying SOLELY on ad-free streaming fell from 30% to 21%.

  • Hybrid Model Stability:  Those using both ad-free and ad-supported services remained steady at around 48%.

What This Means:

  • Limited Backlash: The shift towards ad-supported options hasn't caused a significant decline in overall subscriptions, suggesting consumer acceptance.

  • Tiered Pricing Success: Amazon's success (85% of subscribers on ad-supported) proves offering a cheaper, ad-supported tier is attracting viewers.

  • Platform Variations:  Peacock and Hulu also have high proportions of ad-supported subscribers, while Netflix and HBO Max lag behind.

Overall Takeaways:

  • Ad-Supported Growth:  The streaming market is rapidly shifting towards ad-supported models, driven by consumer willingness to trade ads for lower costs.

  • No Subscription Cannibalization:  The data suggests introducing ad-supported tiers doesn't negatively impact a platform's overall subscription base.

  • Potential Ad Inventory Boom:  This trend could lead to an influx of streaming advertising inventory, potentially impacting ad pricing.

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