Home Opinions Are FAST channels the answer to your revenue woes?

Are FAST channels the answer to your revenue woes?

Faced with a tough economic climate, publishers are turning to FAST to keep revenues growing, but is FAST really the best strategic play? There is money to be made, but audiences skew older, CPMs may be lower, and long streaming sessions can reduce attention and hit frequency caps. Third-party vendor tech makes FAST distribution easy, but may offer little to support actionable analytics. Maybe content owners should spend their energy finding efficiencies in their onsite channels. Reducing ad errors has a significant impact on revenue and could be as rewarding as standing up a new channel. We can look at supply/demand path optimisation. Massive savings can be made on the existing set-up – and maybe it is worth investing there before turning to FAST.

Cameron Church, CEO and Co-Founder, Watching That
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It’s tough out there. Content production costs are through the roof, distribution is hyper-fragmented, attention is scarce, and the cost of living crisis is putting pressure on subscription-only offers.

So it’s no wonder that publishers are turning to FAST as a solution to the need to keep revenues growing. But is FAST a long-term solution? It’s certainly the shiny new thing, but is it the best strategic play?

With FAST channels earning over $12bn globally by 2027, doubling today’s levels (Omdia data), it’s clear that there is gold in those mountains. As with AVOD, FAST channels inventory can be sold directly or programmatically.  But unlike AVOD, with FAST the media owner doesn’t bear the technology, stream delivery and marketing costs. On paper it is all upside if you own content that audiences crave.

But because FAST is offsite, it can struggle to reach the CPMs of more addressable forms of advertising – where first-party data is involved, for example.

The second challenge FAST faces is that of demographic. While audiences are growing in size, they tend to consist of older age groups. That’s fine in itself, but it does provide a limitation for brands looking to reach other demos, or extend reach beyond that older group.

Viewing behaviour also poses a challenge. Linear FAST channels are ideal for long streaming sessions – the TV equivalent of background music. This means they’re not likely to fare well on attention, and will quickly meet frequency caps.

Another question to ask is how the FAST channels will work alongside existing channels, and if there is a danger of audience cannibalisation.

Then come the technological limitations. Whilst third-party FAST vendors’ tech is admirable in how easy it makes the process, it means an extra partner and all the complications that come with that. For data-driven businesses it causes a lot of headaches. Often these third-parties are black boxes, with little in the way of actionable analytics.

With these considerations in place, let us revisit the first question – does FAST offer a revenue solution?

Naturally, the FAST format is designed to provide an easy access point for viewers. And simplicity is at the heart of the FAST proposition. Spinning up FAST channels is theoretically easy; most often they consist of just one IP, and of content that is already ready-to-go, likely sitting dormant. So, it’s a no-brainer way to make money from content that’s gathering dust.

Yet content owners might be just as well served spending their time and energy looking more closely at their existing channel and advertising set up. There are always efficiencies to be made on O&O channels which could make a significant impact on the bottom line.

Ad errors alone account for a huge hole in revenue. These can mostly be avoided, if you know what caused them. Dedicating resource to spotting, and fixing ad errors quickly, could be just as rewarding as standing up a new channel.

There’s also the ongoing job of cleaning the programmatic pipes, and supply/demand path optimisation to undertake. This can’t be done without clear sight of how the whole chain is performing – which again comes down to data. These close-to-home existing issues are easy to overlook, and tricky to dig down into. But they’re crucial when every penny counts.

Perhaps it’s worth considering whether to focus on the massive savings that could be made in the existing set-up rather than investing resources in a whole new set-up.

Where FAST channels are a part of a broader strategy, make sure that the emphasis is not just on establishing the channels. Once they’re live, they must be hawkishly watched, data must be scrutinised, opportunities to tweak ad campaigns, content delivery and QoE must be found.

FAST channels alone are not the answer to revenue woes. But an overall scrutiny of all streaming data, on Owned and Offsite properties, is.

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