Amazon’s IMDB Freedive and the Rise of Ad Supported Video on Demand

Posted by Liz Diles in January, 2019

If your TV home screen comes via an Amazon Fire device, you may have noticed there’s a new streaming app in town. Dubbed IMDb Freedive, this Amazon-owned service offers free, ad-supported movies and TV shows, with a relatively-impressive line-up at launch that includes movies like Memento, Awakenings and True Romance, alongside TV shows like Fringe, Heroes and The Bachelor.

While Netflix is focused on building impressive subscriber numbers, Amazon has quietly become the number three digital advertising platform, behind Google and Facebook, and their advertising ambitions inevitably include digital TV. IMDb Freedive gives Amazon a foothold in the ad supported video on demand (AVOD) space, and the data that goes with it to inform future business strategies.

Overall, connected TV market share is soaring, with viewers ditching cable TV for OTT (“over the top” internet-streaming) services like Netflix and Hulu. As a result, the streaming space is becoming as cluttered as the sprawling cable packages that viewers have been abandoning. In the long run, that creates opportunities for ad-supported TV apps and services.

Mid-2018 figures had the US cord-cutter audience (adults who’ve abandoned traditional cable TV) projected to have reached 33 million by the end of 2018. And big media entities are no longer happy to license their programming to Netflix. With Disney gearing up to launch Disney+ in 2019, popular Disney properties will start migrating to the new platform, which is also going to be home to exclusive new Star Wars content. Using similar brand-name sci-fi leverage, CBS All Access is the only place fans can see Star Trek : Discovery (with a Twilight Zone reboot from Get Out director Jordan Peele also in the works). In 2020, another big name network will join the fray, with NBCUniversal leveraging their formidable content library in a stand-alone ad-supported service.

For the consumer, the growing number of streaming options results in a confusing media landscape, with buzzworthy shows spread out across a diverse range of services. Advertisers may be locked out of the big subscription-service cage fight between Netflix and Amazon Prime Video. But ad-supported services (most notably Hulu, home to the award-winning Handmaid’s Tale) offer access to desirable OTT demographics, like 18-34 year olds with above average household incomes.

Another potential player in the AVOD space is the oddly-named Quibi from Dreamworks founder Jeffrey Katzenberg, oriented around short-form content for mobile consumption (quibi = quick bites). Don’t expect to see Quibi on your mobile screen till 2020, but expect it to be offered in both ad-supported and ad-free models at different subscription price points.

While Katzenberg invests heavily in mobile-friendly short form content, local news gets a boost (at least in New York) with CBSN New York from CBS Interactive, streaming 24 hour Big Apple news. Los Angeles and one other unnamed market may see a similar service in 2019.

2018 saw some setbacks for the streaming media set. Warner Brothers ruffled cinephile feathers by shuttering indie film streaming imprint FilmStruck as part of a streamlining of niche services. Meanwhile, YouTube Premium content is going to be ad-supported moving forward, having failed to drive big subscription numbers on a traditionally-free platform.

Advertisers may have fewer options than they’d like at present to reach streaming viewers, but that situation is changing fast, and not just by the appearance of traditional network names like CBS and NBC. Smart TV manufacturers are including free, ad supported services like PlutoTV and Xumo pre-installed on the home screen. Price sensitive consumers may find their TV home screen is steering them towards the likes of the Roku Channel, and the new iMDB Freedive. As people’s monthly streaming subscription costs continue to creep up towards cable-bill numbers, look for ad-supported streaming to be a bigger part of the picture.

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