Free streaming service Tubi is rivaling major players for viewership
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tubi hit profitability It’s doing what other streaming services have been trying to do this year: attract younger viewers willing to watch commercials.
Fox CompanyThe .-owned free streaming platform has long been ranked among second-tier streaming services alongside lower-budget and less popular offerings like Pluto and The Roku Channel. However, the free service is gaining increasing attention and finding a place in negotiations with big players.
Tubi accounted for 2.1% of total streaming minutes in November meterNielsen’s analysis of monthly viewing trends ahead of NBCUniversal’s Peacock Warner Bros. Discovery’s HBO Max. Google’s YouTube holds the top spot in view tracking.
“Our fans come in and act like this: [subscription streaming] viewers. The only difference is they don’t pay for it,” Tubi marketing manager Nicole Parlapiano said in an interview.
of Netflix The dominance of streaming has led many media companies to chase the same success, spending billions of dollars on original content to attract subscribers and strive for profitability.
In response, the cost of streaming has increased, with nearly every subscription platform making multiple price increases in recent years, pushing consumers toward cheaper, ad-supported options. A crackdown on password sharing from some of the biggest players has also shaken the space.
“People used to cut the cord, now they’re canceling subscriptions. So is this driving more consumption of free streaming? Absolutely,” Tubi Chief Content Officer Adam Lewinson told CNBC.
Tubi said it has more than 100 million monthly active users and 1 billion hours of content streamed per month. By comparison, Netflix reported more than 300 million subscribers as of the end of 2024, when it last reported this metric. Disney+ It reported 131 million subscribers as of the end of September.
About 60% of Tubi’s audience is made up of millennials or Generation Z, and nearly half are multicultural, Tubi said, citing an MRI-Simmons Cord Evolution Study of its audience.
Tubi is expanding its library by licensing movies and TV series, some popular, some niche. The platform produces original content, albeit on a smaller scale than its competitors. It also draws on Fox’s sports arsenal; Two NFL games are streaming on Tubi this year; most notably the Super Bowl in February and the Thanksgiving game last month.
Tubi in total boasts More than 300,000 titles on its platform.
Fox’s response to the broadcast
on Fox in October reported With Fox CEO, Tubi reached profitability for the first time in fiscal quarter ending September 30 Lachlan Murdoch He added that he reached this milestone “sooner than expected.” Tubi reported 27% revenue growth in the quarter, driven by an 18% increase in total viewing time.
Murdoch said at the time he hoped Tubi could continue on track so it could make a “meaningful contribution” to earnings in the near term.
The growth is validation for Fox, which has taken a different approach to the streaming game than its media peers. While its shares are up more than 40% this year, other media stocks have fared less well amid a sea of uncertainty.
The company spun off its entertainment assets to Disney in 2019, and its TV business (broadcast network Fox and cable networks like Fox News) consists mostly of news and sports. Media company in 2020 acquired Tubi for $440 million.
Since then, Tubi was Fox’s main answer to streaming until recently when Fox launched Fox One, a streaming service that streams all Fox content direct-to-consumer for $19.99 per month. Murdoch emphasized that Fox One has no plans to produce original or exclusive content, allowing Tubi to shine with a digital and cost-conscious audience.
Free reigns
Paige Bulera, 23, of Buffalo, New York, said she doesn’t believe in paying the price for disappointment. This is why Tubi has emerged as the winner among all streaming apps.
Bulera said he watches movies more often than the average person and uses his sister’s login information on nearly all major streaming services. But with each subsequent price increase, he becomes less satisfied with his investments.
“Not only are prices going up, it seems like you’re losing something with every price increase,” Bulera told CNBC. “You will no longer be able to share accounts with people on Netflix, or even if prices increase, there will still be ads.”
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The movie list leans heavily towards horror. Tubi said the platform has the largest collection of horror content at 9,000 titles and also offers fan favorites in genres like “Coraline,” “The Wolf of Wall Street” and “Tom and Jerry.”
“With Tubi, it’s completely free; you know you’re getting ads, but it’s promoted in a way that you can watch old movies, new movies or Tubi originals, so I’m a big fan of the platform, especially because it’s affordable,” Bulera said.
A recent report from MoffettNathanson notes that streaming engagement continues to be strong on YouTube, followed by free, ad-supported platforms like Tubi, which include FAST channels. Paramount Skydance Pluto and Roku’s Roku Channel.
Tubi executives say the platform often gets caught up in the same conversation as platforms like Pluto because it presents channels in a grid format that mirrors the traditional linear model. However, since its audience is almost entirely on-demand (meaning viewers choose movies and series from the library rather than tuning into a pre-programmed channel), Tubi argues that it should swim in the same pool as subscription services like Netflix and Disney+.
“Ninety-five percent of people come with the intention of watching what they want to watch, and they are interested. They are not passive viewers,” Tubi’s Parlapiano said.
Executives say the selection process makes Tubi viewers more likely to watch ads than those who watch other free, ad-supported channels for a more convenient experience, or viewers who just want to have something open in the background. This is a powerful sales pitch for advertisers.
“We are 100% ad-supported, other publishers are not. Yes, they have ad-supported tiers, but it is unclear how large those tiers are on each platform and how much tracking occurs in an ad-supported environment,” Parlapiano said.
In Fox’s most recent earnings call, CFO Steve Tomsic said the company’s overall TV ad revenue rose 6%, driven primarily by Tubi’s growth.
Leaning on Generation Z
James Van Der Beek and Noah Beck in Tubi’s Sidelined 2: Intercepted
source: Tubi
According to company executives, Tubi, whose audience consists of 58% young people, has invested heavily to attract the attention of younger generations.
Tubi in June started Tubi for Creators is part of the company’s broader effort to engage content creators in Hollywood.
“The idea behind this is to give creators a path to Hollywood that really allows them to maintain the originality that made them popular in the first place and maintain creative control,” said Rich Bloom, president of Tubi for Creators. “We started with six creators and nearly 500 episodes of content and have now grown to over 100 creators and over 10,000 episodes of content.”
Tubi has signed deals with well-known YouTube artists like Dan and Riya’s “Beverly Valley High” and FunnyMike’s “Mr. Creepy Eyes” to add their existing episodes to the platform. happened at the same time ink deals With independent filmmakers through Kickstarter-funded projects.
Bloom said Tubi has seen the category attract new, younger viewers and that “retention of those viewers is actually better than our overall new audience.”
Tubi’s Lewinson said the platform has been particularly successful with young adult movies like “Sidelined” and “Sidelined 2,” starring TikTok star Noah Beck. Lewinson added that the series only attracted close to 20 million viewers, and the average age of new viewers watching the sequel was just 21.
Tubi’s Turn Aside 2: Captured
source: Tubi
“We’re really proving that we can bring younger audiences to a long-form streaming platform,” he said. “There’s a perception that they’re only interested in short form; that’s simply not true. As long as you have content that’s relevant to their fandom, they’ll come to Tubi.”
Generation Z also gravitates towards nostalgia; Older shows like “Columbo” and “Murder, She Wrote” are also popular on Tubi.
Tubi executives say the growing Gen Z and Millennial audience is another selling point for advertisers.
“My acquisitions team can go out and buy anything we can find, but we find that the more we produce these types of stories, the more we really attract those audiences,” Lewinson said. “They’ll come to watch ‘Sidelined,’ but we follow their journey to see what else they’re watching on the platform and make sure we have a lot of those types of categories for those viewers to watch.”
Disclosure: Comcast is the parent company of NBCUniversal, which owns CNBC. Versant would become CNBC’s new parent company, based on Comcast’s planned Versant spinoff.
