Amagi’s KA Srinivasan on FAST monetization, trends and challenges

Free ad-supported streaming television has emerged as a disruptive force in the entertainment world, offering viewers a compelling alternative to traditional cable and subscription-based streaming services. As the FAST ecosystem continues to evolve and mature, content providers and technology partners are navigating a complex landscape filled with new challenges and opportunities in monetization, content curation and viewer experience.

To gain insights into the current state and future trajectory of FAST, NewscastStudio recently spoke with KA Srinivasan (Srini), the co-founder and chief revenue officer of Amagi, a company that provides infrastructure for FAST and other streaming services.

Srinivasan noted that the appeal of FAST for content providers lies in its potential for profitability.

“Everybody wants to get into FAST. They see this as a way for them to create a highly profitable business unit, because the channel costs are already amortized, taken care of,” noted Srinivasan. “That’s a fantastic business model from a tier-one perspective.”

When content providers approach a vendor like Amagi to launch a FAST channel, they typically have three main requirements.

First and foremost, they prioritize maintaining the same quality as traditional cable channels.

“From a viewer experience, it doesn’t look like a bunch of YouTube videos stitched together. It’s not a social media experience. It’s TV, your cable TV experience,” Srinivasan emphasized.

Second, they seek deep distribution across various platforms such as Pluto TV, Tubi and Freevee to maximize their reach. Finally, they require seamless integration with their existing workflows to ensure a smooth transition into the FAST ecosystem.

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The FAST path to content monetization

Monetization is a critical concern for FAST channels, with a mix of programmatic and direct ads being utilized.

While tier-one networks often have their own monetization capabilities, smaller content providers may rely on vendors to provide a full monetization solution. CPMs for FAST channels can range from $10 to $40, depending on content type, target demographics and whether ads are sold directly or programmatically.

“I think we have a fantastic opportunity in front of us, given it’s a CTV ecosystem as opposed to traditional TV, to reduce the ad load for the end user,” said Srinivasan. “Instead of having, 8-10 minutes per hour – which is still way better than what cable had – can we bring that down to four or five minutes by doing much more innovative ad units?”

Through new ad units, such as overlays, badges and picture-in-picture squeezes, CPMs could improve while requiring fewer ad minutes per hour, providing an overall better user experience while still providing optimal monetization.

Srinivasan views the ad load, coupled with the current viewer experience on many platforms, as a challenge for the growing FAST industry. Filler content, such as slates during traditional commercial breaks, impact the user experience.

“Go watch a news network or any cable network, you’ll never see a slate. That concept does not exist, but you go to a FAST, it’s a very frustrating user experience. You’re flipping a channel, all you’re seeing is, ‘Hey, I’m going to be back in two minutes,’ right?”

The path to FAST 2.0

Looking ahead, Srinivasan believes that the FAST ecosystem will undergo significant changes in what he refers to as “FAST 2.0.”

“What we have done with this current version of FAST is, essentially we have replicated what was on cable. You’ve not leveraged any feature of CTV at all… it looks exactly like what you’d see in a traditional cable.”

This evolution will likely include more personalized experiences, such as customized channel lineups based on viewer preferences and location.

“I think what we’ll see with FAST 2.0 was a lot more personalization of the EPG (electronic programming guide). For instance, I’m sitting in Atlanta, I don’t need to watch what’s happening in San Diego. I don’t need to see the channel cluttering my EPG,” he explained.

Contextual advertising, data transparency and the adoption of a common currency for measuring viewership are also expected to play a significant role in the future.

“Contextual is going to become more and more critical. I mean, how do we actually provide more metadata? Again, leveraging the power of CTV can actually make it much, much more targeted,” Srinivasan said. As the ecosystem matures, content providers will likely focus on offering more targeted and innovative ad units to improve the viewer experience and maintain high CPMs.

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“These are items that we take for granted in traditional broadcast,” said Srinivasan. “It’s all opaque if you will, in case of CTV. So some basic data transparency and signaling so that we can have better targeting and more visibility for advertisers.”

The FAST landscape is also set to expand, with an increasing presence of sports and local content, the integration of FAST channels into traditional CTV apps and a growing emphasis on live programming.

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“We’re going to see a lot more live. Whenever we have seen live, whether it’s a game, whether it’s a newscast, whenever there’s a live show, we have seen viewership shoot up across our customers channels. So live is going to be a huge part of what we are investing today, and what we’re working on with many of our customer,” said Srinivasan.

“We have seen Comcast Xumo for example, where they’ve actually brought (FAST) into the experience, and we’re going to see a lot more of that with the cable provider as a way for them to offer more value to their subscribers, reduce churn and hopefully get more advertising revenues,” said Srinivasan.

The rise of FAST represents a significant shift in the television landscape, offering viewers a free, accessible alternative to traditional cable and subscription-based streaming services.

As the ecosystem matures, it will be crucial for stakeholders to remain agile, innovative and focused on delivering value to both viewers and advertisers. With the right strategies and partnerships in place, FAST has the potential to become an increasingly profitable and integral part of the future of television.

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