Viacom is making a play for ad-supported streaming video

In the U.K., interest in ad-supported streaming video is heating up, and Viacom is carving out space for itself in the market.

The media company is distributing some of its TV programming on its ad-funded streaming video service Pluto TV while sharing its Pluto channels on My5, Viacom’s video-on-demand platform from public-service broadcaster Channel 5, to help grow reach and awareness.

Beginning Aug. 1, three channels from My5 will be distributed on Pluto TV in the U.K., following on from last month’s announcement that My5 is distributing three Pluto TV channels.

According to the media company, it’s reaping the benefits of this content sharing between platforms. In one month, Pluto TV content on My5 now accounts for 5% of viewing on the platform. The addition of the three channels from Pluto TV means My5 now has 10 third-party content channels, there has been a 42% increase in volume of hours on the platform year over year.

To more broadly drive viewers, My5 has been bolstering its content beyond a catch-up service by partnering with different channels and acquiring shows that aren’t on its linear service. Now, 12% of viewing is to non-Channel 5 content from channel partners, including Pluto channels, PBS America, Real Stories and Blaze, and acquiring drama shows. Between April and June, viewing on My5 has increased by 15%, compared with the period between January and March. Two out of six acquired dramas, “The Oath” and “Bellevue,” have been in the top 10 shows over the last few months, according to the company.

“This is incremental viewing, rather than viewing four or five streams people are viewing five or six,” said Oli Thomas, vp, digital, Viacom International Media Networks, U.K., Northern and Eastern Europe. Over the next six months, My5 will add more partners and beef up analytics and data capabilities on product and marketing performance. “The shift is for us to become the top advertising video-on-demand product of choice for U.K. audiences,” he added.

Pluto TV features online video plus a library of on-demand programming and globally has 16 million unique viewers per month, up from 12 million when it was acquired by Viacom in January 2019. Ampere Analysis estimates that My5 is in 4 million households. By content sharing, both should extend their reach and awareness.

“My5 and Pluto are very different services; they reach very different audiences,” said Thomas. “Pluto is more a lean-back experience while My5 is more lean-forward, catch-up experience. There’s sufficient growth in the industry to not cannibalize; it’s a net win for both.”

According to Thomas, the audiences complement each other too: Pluto viewers are generally male and skew older, while My5 viewers are female and on the younger side.

While other U.K. public service broadcasters like ITV Hub and All 4 are building out their own video-on-demand and subscription platforms, Viacom is going after a slice of the AVOD market.

In 2018, the estimate for the U.K. online video ad space, including pre-roll, social video, publisher ads and VOD, was £2 billion ($2.4 billion), according to Ampere Analysis; roughly half of that is expected to have gone to Facebook and Google. The subscription over-the-top marketing is estimated at £1.3 billion ($1.6 billion). There’s a potential hole in the market that Pluto could fill if it gets the content proposition right.

As much as Viacom’s ad-funded streaming platforms are positioned to appeal to digitally curious TV advertisers, the platforms also target digital advertisers that may not want to concentrate their ad spending on Google and Facebook.

To bolster its offer, My5 has grown its registered user base by 19% over the year through increasing investment in product, content and marketing. The company wouldn’t share actual numbers. Ad revenue has grown too, said Thomas.

Building up the number of registrations is key over the six months to grow the data pool of willingly given first-party information, like name, email, date of birth and location, a much more attractive sell for advertisers. Not only this, more content on the platform means making it more discoverable by targeting it to viewers. As such, it plans to add features so people can pick up on content where they left off on different devices.

While My5 is smaller than the other PSB in terms of viewers and revenue — All 4 has 18 million registered users — it outperforms with audiences of young families because of its pre-school kids channel “Milkshake,” according to a report by Ampere Analysis and U.K. regulator The Office of Communications.

“Keeping kids as they transition through the Viacom portfolio as they age seems a sensible long-term strategy,” said Richard Broughton, research director at Ampere Analysis.

Viacom’s strategy is an extension of how it’s sharing content and growing ad revenue in the U.S. where it debuted 15 of its channels on Pluto TV. Amazon and Roku are the two dominant services and will likely push their own ad-funded series to build out hefty businesses, but Pluto TV has proven to be a bright spot for revenue and viewers for content makers.

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