Ad-supported programming is becoming more and more of a thing for streaming services. At the moment, NBCUniversal’s Peacock, Paramount Global’s Paramount+, Warner Bros. Discovery’s HBO Max, and Disney’s Hulu all feature cheaper ad-supported options, and Disney’s ESPN+ comes with ads, as does some of Amazon’s Prime Video content (including Thursday Night Football). Amazon also has the free ad-supported TV (FAST) Freevee service, while Fox has a similar setup with Tubi, CBS has CBS Sports HQ, and even some leagues have FAST Networks. Meanwhile, Netflix has an ad-supported tier coming, and now it looks like Apple TV+ is developing one as well:
With more ad tech in prospect, Apple is approaching Madison Avenue with a different tack. Apple, Digiday has learned, is preparing a more serious push into monetizing its original video content with an ad play, according to several media agency sources. https://t.co/GXalFVYxze
— Digiday (@Digiday) October 12, 2022
Here’s more on that from that Digiday piece, from Michael Bürgi and Ronan Shields:
Apple, Digiday has learned, is preparing a more serious push into monetizing its original video content with an ad play, according to several media agency sources that held separate exploratory discussions with the digital giant.
…There’s no shortage of original programming, including the multiple-Emmy winner Ted Lasso, on which to run ads.
The question is, when will it start? One agency source said Apple was not asking for that media agency network to put aside client dollars in the fourth quarter, so it seems more likely to be in early 2023.
“Anything that would open up premium inventory [in connected TV or streaming] would be a positive,” said the exec. “The last bastion is Apple TV. Apple is going to be a very good ad experience with probably a low ad load. They’re already actually very diversified in terms of revenue streams so there’s less pressure to fit lots of ads.”
A third holding company executive also met in summer with Apple [VP of ad platforms Todd] Teresi, who talked about ad opportunities around the sports programming (which includes a 10-year deal with Major League Soccer), but this executive said the discussion didn’t address an ad-supported tier on Apple TV.
It looks like there’s a lot of this still to be decided. That includes whether ads will be just on the live sports programming or if there will be a wider ad-supported tier for all of Apple TV+. On the live sports programming front, Apple’s MLB games (which have been free to this point, not requiring an Apple TV+ subscription) already have ads, but those have been sold by MLB so far. However, the MLS programming starting next year (in a 10-year global deal for all game rights, local and national, although some will be available without an Apple TV+ subscription, and there could also be some sublicensing to linear TV) certainly seems likely to have ads of some sort.
And this piece makes it sound like Apple is likely to do the MLS ads at least somewhat in-house. That’s especially true when mixed with a previous Digiday report that Apple is building a demand-side ad platform (despite previous vows they weren’t interested in that). Whether that leads to a wider ad-supported tier for original AppleTV+ programming is a good question. And the timing there may be interesting too; Ted Lasso is that service’s biggest popular and critical hit to date, and its third and seemingly final season still doesn’t have an air date, so an early 2023 launch of an ad-supported tier would certainly seem to work for it. At any rate, it’s notable to hear of Apple having these conversations and developing these plans, even if actual details are scarce at this point.
[Digiday; top image from Ted Lasso S2 E6]