Over-The-Top, Ad-Supported Tubi TV Closes New Round On Eve Of Upfront

Burgeoning ad-supported, over-the-top movie and TV streaming service Tubi TV last week closed a $20 million round of funding, which it will use to expand its presence on Madison Avenue, as well as with consumers.

The service, the closest thing to a conventional ad-supported TV network distributed online, utilizes conventional TV advertising breaks to pay for consumer access to film and TV show libraries users would otherwise have to buy.

In fact, Tubi TV is bucking a trend of OTT services, such as Hulu, which are going in the opposite direction and charging consumers for access to their libraries.

"Our initial focus will be on technology and our analytics platform,” Tubi TV Founder-CEO Farhad Massoudi, says of the new funding. He says the goal is to improve the user experience even more in terms of using data to “optimize” both content and advertising so users increase their engagement and time spent on Tubi TV.



That, in turn, will lead to better returns on advertising exposure.

“We are constantly fine-tuning our product,” he explains, adding the funds will also be used to grow Tubi TV’s brand in the marketplace, both with consumers and advertisers.

While Tubi TV doesn’t have an official event scheduled for the 2017-18 upfront marketplace, Massoudi says he and his team are holding one-on-one meetings with key advertisers and agencies to build awareness, and hopefully market share, too.

Regardless of its B-to-B of B-to-C messaging, Massoudi says the goal is differentiation for other subscription video-on-demand services -- and business models -- distributed over-the-top.

“There are 150 to 250 subscription VOD services, and most of them have no path-to-scale,” he asserts, adding: “If you look at most of the big services, they invest heavily in a few shiny new TV shows -- like [Netflix’s] ‘House of Cards’ -- but our strategy is to invest in something sustainable, focusing on having both the depth and the brand library that consumers can watch over time.”

Based on its licensing deals, Massoudi boasts that Tubi TV’s library already is “second only to Netflix’s.”

Tubi TV’s library includes more than 50,000 movie and TV titles from major studios, such as Lionsgate, MGM, Paramount Pictures and Starz.

While Tubi TV continues to test, learn and adapt advertising formats based on user experience and behaviors, ads typically appear in conventional cbreaks, are 100% “viewable,” and not subject to ad-blocking.

Most of Tubi TV’s views come from native applications that block ad blockers, and for users who access it via browsers. Tubi TV does not allow them to access its content when they have ad blockers turned on.

The company said its audience grew nine-fold in 2016 and currently claims its reach is larger than HBO Now and CBS All Access combined.

7 comments about "Over-The-Top, Ad-Supported Tubi TV Closes New Round On Eve Of Upfront".
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  1. Ed Papazian from Media Dynamics, May 15, 2017 at 9:25 a.m.

    So how big is the audience----3 million per month? And how many viewers does an average commercial placement reach? At what CPM? Inquiring minds will want to know.

  2. Joe Mandese from MediaPost, May 15, 2017 at 9:59 a.m.

    @ed: I'm not sure, I think Tubi TV has 20 million installed users (not the same as active users), but is growing fast (9x growth in 2016). I don't see a media kit of any boilerplate on their site, but here's their ad dept. contact: advertising@tubitv.com

  3. Long Ellis from Tetra TV, May 15, 2017 at 10:50 a.m.

    Whatever the total audience, the important play here is providing advertisers with a way to reach cord nevers and cord cutters, who do not want to pay expensive cable bills and are willing to watch programming with commericals. The question is....how do advertisers influence these people on linear TV? TubiTV has a pretty good anser I would say!  

  4. Ed Papazian from Media Dynamics, May 15, 2017 at 11:01 a.m.

    Long, the real question for most advertisers is whether reaching so-called cord cutters is a top priority when these same lightly exposed consumers are also lightly exposed to most TV ad campaigns---including those of rival brands. As a result, many marketers who take the trouble to look at data discover ---to their surprise----that they are doing just about as well among cord cutters, SOM-wise---as their competition. So why reduce your share of media voice among moderate to heavy viewers to switch GPR weight to cord cutters? Will this actually improve your overall sales picture? It's food for thought, I would think.

  5. Joe Mandese from MediaPost, May 15, 2017 at 11:06 a.m.

    @Ed: You may recall similar debates in the early days of cable TV, until Walter Reichel came up with Ted Bates' "5% solution" to address the under-delivery of broadcast in cable TV households (ie. light network viewers). Obviously, there was also a demographic consideration, given that cable was perceived as more affluent than covnentional broadcast households. I think the same things are operating here, but on steroids (younger demos, and in some cases, zero linear TV access). If you don't think those are valuable consumers to factor into the mix, well...

  6. Long Ellis from Tetra TV, May 15, 2017 at 11:14 a.m.

    It will obviously depend on the product category, the demo/age/psychographic target and the advertising strategy of the brand. If you value this audience and can't get it elsewhere without a ton of waste, guess what! It would represent a lot of value and smart solution.  

  7. Ed Papazian from Media Dynamics Inc, May 15, 2017 at 12:35 p.m.

    Long and Joe, I do remember the debates, which go even farther back and were centered mainly on the fact that light viewers---often upscale and youngish----were under delivered by conventional TV buys. All I'm suggesting is that, in many cases, there is an accompanying assumption that because a brand places less GRP "weight" against light viewers that this has an adverse impact on its share of market among such people. However, in many cases, I have found---using Simmons and/or MRI data--- that this is not the case and a brand's SOM may be the same as it is nationally among light viewers. The obvious reason---demos/mindsets, aside---is that it's category rivals are also undelivered among light viewers as they, invariably use the same types of media buys, which cancel out the GRP weight issue. Now this does not neccessarily mean that one shouldn't consider heavy up GRP weighting among light viewers but one has to examine the trade-offs in terms of lowered GRP weight among heavy viewers. As the latter are much, much easier to reach, you often lose 7-10 GRPs among heavy viewers for every single GRP gained among very light or, in this case, presumed "non viewers". Also, light viewers tend to be much less into TV content---especially commercials---and are probably less likely to pay attention to them or believe what they have to say. Such "intangibles" also come into play. So, by all means, think about it----but only in a serious, brand-specific and competitive context.

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