Is Ad-Supported Streaming Ready For Broadcast TV’s Sales Execs?


Among the many streaming-focused story pitches and research reports sent to the Radio + Television Business Report on a near-daily basis is a study that wonders just how premium-tier, subscription-based streaming services are faring through the COVID-19 pandemic.

While streaming surged, did AVOD — advertisement-based video on demand — benefit more? If so, are their riches for the taking for broadcast TV owners looking for a digital dollar infusion?

As health concerns subside thanks to the summer son and a decline in novel coronavirus-related deaths, the COVID-19 damage to family finances may be more everlasting. With a high number of unemployed workers seen across April and May, with only some returning to positions today, subscription-based services may be under the budget microscope.

As notes, the average cost for streaming TV services — based on a study from Mint and The New York Times — was $170 per year. While that pales to a monthly MVPD cable bill, which in some homes could be $170 per month, those streaming costs are up roughly 31% since 2017.

To conserve cash, an ad-supported option may be the way to go. These are available on Hulu and CBS All Access, and NBCUniversal’s highly anticipated Peacock — a big talking point during NBCU’s not-an-Upfront online business presentation held May 11.

Armed with the knowledge that ad-supported options could potentially grow in COVID-19 times, — a nonprofit owned by Centerfield Media Company — examined “just how different the viewing experiences are for those who see ads associated with streaming shows and those who don’t — and help folks who might be on the fence make some decisions about whether shelling out even more money for streaming is really worth it.”

The editorial team at watched dozens of hours of content, including videos, shorts, TV shows and movies, on CBS All Access, Crackle, Hulu, IMDb TV, Quibi and YouTube Premium, all of which offer on-demand streaming content with ads and four of which have ad-free tiers. IMDb TV is accessible via Amazon Video.

What were some of their key findings? CBS All Access’ spot load is akin to some of the nation’s biggest radio broadcasting companies. It’s really, really long, in online terms.

  • Assuming 20 hours of streaming per month, Hulu’s ad-supported product saves you $6 in exchange for 31 minutes of ads, or $11.53 per hour. CBS All Access saves you $4 in exchange for 107 minutes of ads, or $2.23 per hour.
  • CBS All Access played the highest number of ads per hour of content — more than five minutes of ads per hour of streamed TV.
  • Hulu’s cheaper version ($5.99 per month) had the fewest ads, about 90 seconds of ads per hour watched.
  • Some platforms include the ability to stream movies as well as TV. Ad time during movies was the highest and most obtrusive on Crackle, where “The Big Chill,” a movie with a running time of less than two hours, included more than 12 minutes of ads.
  • Many new original shows ran without ads or with brief ads at the beginning of shows, even on ad-supported accounts.

In traditional television, viewers will usually see about eight minutes of ads during a 30-minute show, meaning the actual content is about 22 minutes long. Similarly, an hour-long show will usually come with about 42-45 minutes of content and the rest will be ads, acknowledges.

“Generally, streaming platforms cut this time down considerably,” it says. “Even free services like Crackle and IMDb TV, neither of which offer a paid version, offer shows with fewer and shorter commercial breaks.”

A comparison of streaming vs. traditional TV was then made, with respect to ad count.

“In our analysis, we looked at half-hour shows, hour-long shows and films where possible, and compared the time spent on ads to the time spent with the actual content,” it says. “On average, time spent on ads equates to about 6% of content time, though this varies depending on the platform and type of program.”

Where is the ratio highest? Look no further than CBS All Access. For new-run shows on the platform, typical episodes of the half-hour comedy “Mom” include about five minutes of ads.

But, while this is relatively high for streaming, it still lets viewers cut about three minutes of ad time compared to watching the show live on TV.

Additionally, “Mom” is still on the air, unlike some of the other shows available on the platform, like “CSI,” which averaged about 17% of ads to content.

Across the six platforms, saw an average of about three minutes of ads per hour of content watched. Again, CBS All Access led the way with more than five minutes per hour. Hulu’s ads-to-content ratio was the lowest.