Speaking to Multichannel News in the spring of 2019, Tubi founder and CEO Farhad Massoudi dismissed the notion that his AVOD platform would soon sprout original shows.
“Strategically, it doesn’t make sense for us to make original content, with Netflix spending $13 million or $14 million on originals” said Massoudi, who was still a year away from brokering the $440 million sale of his streaming company to Fox. “That’s way beyond what anyone in the AVOD ecosystem could spend.”
With so much competition in SVOD, Massoudi predicted that churn would get out of hand, with consumers signing up for streaming services just to see a coveted new show and then canceling soon after.
“That doesn’t pay for the price of the original—in fact, it suffocates the show,” Massoudi said. “It’s not a game the content companies can continue to play.”
Jump forward a little more than 700 days, several corporate mergers and one pandemic, and a lot about AVOD has changed. The ambition is much bigger overall.
Amazon is spending lavishly on its free-to-consumer IMDb TV platform, recently commissioning a spinoff of its long-running Prime Video original, Bosch, to the platform. Roku is ramping an apparatus to build originals and is already combing domestic and international markets for acquisitions.
And as Broadcasting & Cable reported, last week, Fox CFO Steve Tomsic, speaking at the Deutsche Bank’s Media, Internet & Telecom Conference, said that putting Fox hits like The Masked Singer has given Tubi a boost, the company is looking to put original programming on Tubi.
“Over time, as we look at genres that really work on Tubi, we will cost-effectively look at sort of originals, but I stress that it’s going to be cost effective,” Tomsic said.
Fox expects Tubi to generate $300 million of ad revenue this fiscal year, he added.
Daniel Frankel is the managing editor of Next TV, an internet publishing vertical focused on the business of video streaming. A Los Angeles-based writer and editor who has covered the media and technology industries for more than two decades, Daniel has worked on staff for publications including E! Online, Electronic Media, Mediaweek, Variety, paidContent and GigaOm. You can start living a healthier life with greater wealth and prosperity by following Daniel on Twitter today!
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