It’s only natural that a lava flow of challenges and bright prospects will shoot to the surface whenever a hot new trend in the media world emerges. And that’s certainly true in the advertising-supported streaming space. Local media players involved in FAST and AVOD platforms are intent on grabbing hold of political advertising during the 2024 election cycle and are finding more receptive advertisers in general.
At the same time, content players must deal with the streaming platforms’ reluctance to share critical data that can help advertisers appreciate their value proposition — and help the channels understand how they can give audiences what interests them. Platforms are also winnowing out some channels. And the lack of one agreed-upon currency is a sticking point (as is true more broadly in the video space).
Those factors all bubbled up during TVNewsCheck’s TV2025 conference’s panel session “Go FAST, Go AVOD: Charting a Streaming Revenue Strategy for Local Media.”
Jennifer Donohue, SVP of Disney Advertising Sales, Local, characterized the streaming space as a “dynamic marketplace” that is at least partially fueled by advertisers’ desire to do more with fewer dollars. In speaking more generally about the local business, including streamed content, she said that “the number of advertisers is up 50% this year, and that’s really spurred by self-service. Our streaming platform continues to grow because of engagement and our ability to offer measurement and targetability.”
Local advertisers are alert to the opportunity. “They look at local representatives as local marketing experts. They’re listening to them. They understand that audiences are in different places,” said Tom Sly, VP of enterprise strategy at The E.W. Scripps Co. “We’re seeing much better engagement on the local level — with CTV-FAST [along with] O&O inventory — than we are on the national side. It’s been a great business for us.”
Tegna is garnering “hundreds of millions of views per month” in the AVOD space, specifically on YouTube, where it places various shortform content. The lion’s share of it was published prior to 2023, said Adam Ostrow, the company’s chief digital officer. “It’s helping us monetize a library of older content.” A significant number of viewers are outside the market in which the content was produced.
On the FAST front, Tegna stations have apps on Roku. “That business is growing really fast for us as well. That’s where you can get the 24/7 feeds,” Ostrow said.
Ticker News finds its revenue in a different way, through native advertising. Its FAST channels are streamed on various platforms around the world. Hosts interview “thought leaders” who speak on such topics as cybersecurity. “We have a person talking about an issue, and ‘here’s how we’re fixing it.’ So it’s not a sales pitch, but information to help the viewer understand a situation,” said Ahron Young, CEO of Ticker.
All of the station groups represented on the panel are clearly gearing up for the election cycle ahead. BIA Advisory Services is projecting that local digital media will rope in $117.8 million during the 2024 season, or 22.8% of the entire local pie. (Those figures include not only over-the-top, but other sectors as well, such as email, newspapers and mobile.)
Scripps has a dedicated election office for ad sales, which includes a digital team, Sly said. The overcrowding that is sure to take place in the spot market should push some advertisers over into the streaming side of the business.
“We saw this in ’22,” Ostrow said. “Two or three months before, not only did our rates go up, but our fill rate went up.”
“What we’ve learned is that it’s not just waiting for the cycle to come. Political is now year ’round. From presidential to statewide to local elections to runoffs,” said Donohue, who added that Disney has built out the election ad sales process for the streaming business.
Then there are the challenges. The session’s moderator, Adam Wiener, founder of Continuous Media, asked the panelists to discuss the lack of consensus about what currency should be used for transactions. “We need buyers all buying the same way,” said Sonali Pathak, SVP, business development and strategy, local, at NBCUniversal. “That’s the dream we all have.” She expressed hope that there would be some resolution to that friction point in the near future.
Sly seemed less optimistic about how soon the issue will get resolved. “We can’t afford — especially local broadcast — to subscribe to six different currencies. It doesn’t scale for us. There has to be some meeting in the middle for the industry,” he said.
There are also some problems with the streamers. Wiener noted, “It’s increasingly becoming more difficult to negotiate with them, and almost impossible at times to get data from them.”
“These are partnerships, and a partnership should be two-way. I call it distribution equity. We need to make sure that content creators are getting the data they need to monetize. Buyers want that data,” Sly said. He added that Scripps is working with the platforms to improve the terms related to data.
There’s also an oversupply of FAST channels and economic headwinds. Platforms are dropping some channels. “I don’t disagree with the culling of channels. That’s every platform’s prerogative. We want to make sure there’s quality content out there, but the criteria they use should be fair,” Pathak said. She noted that there are also concerns about the placement of channels on the platforms.
“That’s where data matters, not only from an ad sales perspective, but creating channels that really serve the audience,” she said. “It’s great for both sides, the platforms and for us.”
Read more coverage of TV2025 here.
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