All you need to know about 'FAST Channels'

The American psychologist Barry Schwartz, in his book The Paradox of Choice, argues that having a plethora of choices can overwhelm consumers and leave them unsatisfied. In the retail world, he suggests that eliminating choices can greatly reduce anxiety for shoppers. A similar situation can be observed in people's television viewing behaviour.

Streaming services have become popular for their on-demand, binge-friendly and ad-free formats. But some people are growing tired of having to make choices and are seeking a relaxed experience where at the click of a button they can watch curated content. Just like the old linear television experience where one would flip through channels to settle onto one to watch passively.

For this audience, a solution is emerging in the recent rise in Free Ad-Supported Television (FAST) services. This week Amazon will be launching Fire TV channels to host its FAST content in the US. In January, Warner Bros. Discovery partnered with Roku and Tubi to launch its FAST offering in the US. Around the same time, YouTube also began a test that allows select viewers in the US to watch FAST channels via a dedicated hub on the video platform. Meanwhile, Netflix co-CEO Ted Sarandos has also said that the streaming platform was open to exploring a FAST model.

What is FAST?

FAST brings in the comfort of traditional broadcast within the streaming landscape. Alan Wolk, co-founder and lead analyst at media analyst firm TVREV, is widely credited with coining the acronym FAST. “Everybody kept referring to these channels as AVOD, and we thought, ‘That’s really not quite it.’ So, we came up with something we thought was a more accurate description," the entertainment news website Deadline quotes him.

While FAST channels can be viewed on any device, it is largely consumed on connected televisions (CTVs). Not only does the viewer get to enjoy content free of cost, they don't have to worry about making choices as well. Unlike the regular streaming service, the viewer here has no control over the programming. The content is presented in channels and it offers the possibility of having niche channels, catering to particular interests and languages. It also helps in the easy discovery of content.

In a country like India, traditional television channels have always had to cater to the mass audience. But with this, the audience segmentation can be much better. This is expected to bring in more diverse content. For example, there could be one channel for pet parents or one in a niche local dialect.

The FAST scenario in India

FAST originated in the US. Currently, Pluto TV, Xumo, Tubi, The Roku Channel, IMDBTV, and Samsung TV Plus, offer FAST services in the US.

It came to India pretty late and is still in a very nascent stage. As streaming became popular during the pandemic people began discovering FAST channels. Currently, most prominent news networks, including NDTV, ABP, Zee News and TV Today, have launched their channels. While the big television networks like Star, Sony, Zee or Viacom are yet to make their presence felt, QYOU Media has launched three channels- The Q, Comedistaan and Q Marathi.

Krishna Menon, chief operating officer, QYOU Media India, believes that FAST will see success in the next couple of years and at some point of time it will start becoming the only source of entertainment for a lot of viewers in India. Free content, generally, works well in India. In fact, streaming's growth in the country has been driven by the adoption of ad-supported video on demand (AVOD). This is in great part due to the audiences' willingness to watch ads in exchange for free TV content.

A research conducted by Samsung and global market research agency Verve shows that 4 out of 5 Indians are willing to watch ads in exchange for free content, a much higher percentage than the US, UK and Australia. Research by Magnite, a global independent sell-side advertising platform, has also arrived at the same finding. This is what makes the Indian CTV market and in particular the Indian FAST market, enticing to advertisers and content partners.

These channels also help content creators in solving the problem of content discovery. With an overwhelming quantity of content being produced, it becomes difficult for viewers to discover content of their interest. FAST channels serve as a content marketing strategy to introduce undiscovered content.

"FAST channels address this issue by providing a free-to-air channel that allows viewers to stumble upon interesting content that they may not have discovered otherwise. If the content is branded by an OTT platform, they may seek out the brand to watch more content and even pay for it. It is a means for content owners to increase brand awareness and attract viewers", says Manik Bambha, co-founder and president, ViewLift.

Who provides the service?

Different players are vying to make their presence felt in this space today. One, is the television device manufacturers, like Samsung. Two, OTT platforms like Amazon Prime Video and Netflix. For the platforms that have transitioned from SVOD to AVOD or from SVOD to SVOD+AVOD hybrid, FAST is expected to create a sizable revenue chunk. Three, telecom companies.

The device manufacturers have become distribution partners and have separate apps for FAST channels. For example, Samsung has Samsung TV Plus for its smart TVs, smartphones and tablets. The channels are segmented into different genres like news, sports & outdoors, entertainment, lifestyle, kids, etc. The content creators offer their content for these channels.

Meanwhile, OTT platforms house their FAST channels within their apps and can be accessed on all devices.

What does it mean for advertisers?

In the US, FAST channels are witnessing a rise in advertising revenues. A S&P Global Market Intelligence report estimates the US FAST business revenue to be in the range of $4 billion in 2022 and expects it to more than double to almost $9 billion by 2026. Experts are suggesting a similar trend in India as well.

"FAST has started picking up in Europe, Canada and Australia. India is also at the cusp of change," says Baskar Subramanian, founder, Amagi.

Amagi, which has powered the backend of some of these FAST channels, claims that its viewership has increased 20 times in the last 12 months.

India’s CTV ad spending is expected to grow at a CAGR of 47% between 2022 and 2027, according to a GroupM-Kantar report. Advanced addressability and accessibility are the key drawing cards for FAST channels. With better user data analytics and segmentation capabilities compared to the traditional linear distribution, advertisers will have more value and content owners will be in a better position to generate better ad revenue.  

With enhanced targeting capabilities within this setting, valuable insights can be utilised during every part of the TV campaign. "From the very first pre-planning stages, FAST can offer the contextual placements of ads next to curated or genre-based channels, taking optimisation to a new level," says Prabhvir Sahmey, senior director, Samsung Ads India.

Gavin Buxton, managing director, Asia, Magnite, believes the proliferation of streaming will help open up TV advertising to brands that have traditionally not made use of television, creating opportunities for them to connect with audiences in a premium environment. "As many larger industry players migrate towards ad-supported offerings in line with consumer preferences, this also drives adoption of streaming services and brings more supply to the market," he says.