Ad-Supported Video on Demand (AVOD) Market to Reach USD 125.5 Billion by 2031, Growing at a 13.1% CAGR

The Ad-Supported Video on Demand (AVOD) market is experiencing significant growth due to a combination of technological advancements and changing consumer preferences. As a free alternative to subscription-based services, AVOD platforms allow viewers to access a wide range of video content, including movies, TV shows, and live events, while being exposed to ads. This business model has gained considerable traction in recent years, driven by the increasing demand for free entertainment and the rising popularity of streaming services. The AVOD market is particularly attractive to advertisers as it provides a vast audience base for targeted advertising, especially as consumers are more inclined to opt for free services over paid subscriptions.

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According to recent market statistics, the global AVOD market was valued at approximately US$ 41.3 billion in 2024, with a projected market value of US$ 125.5 billion by 2031. This growth is expected to occur at a robust compound annual growth rate (CAGR) of 13.1% from 2024 to 2031. The key drivers behind this growth include the increasing consumption of digital video content, the widespread availability of high-speed internet, and the increasing use of mobile devices for video streaming. The leading segment within this market is the media and entertainment sector, while North America continues to dominate as the leading geographical region due to its strong infrastructure, high consumer demand for digital content, and a mature AVOD ecosystem.

Key Highlights from the Report

• The global AVOD market size in 2024 is expected to reach US$ 41.3 billion.
• The market is projected to grow at a CAGR of 13.1% from 2024 to 2031.
• The media & entertainment sector is the leading segment driving the market growth.
• The sports and live event content segment is a significant driver for AVOD services.
• North America is the leading region in the AVOD market, accounting for a significant market share.
• The increasing internet penetration, along with the roll-out of 5G networks, is enhancing the AVOD experience.

Market Segmentation

The AVOD market can be segmented based on product type, end-users, and content categories. The product types primarily include platforms offering streaming of movies, TV shows, sports events, and news. These platforms rely on advertising revenue to generate income while providing free access to a wide variety of video content. As consumer preferences evolve, AVOD platforms are diversifying their content offerings, with live sports events becoming a central aspect of these services. Media and entertainment remain the largest segments, but other sectors, such as travel and tourism, are gaining traction due to their visual appeal and promotional potential for advertisers.

In terms of end-users, the AVOD market caters to both individual consumers and business-to-business (B2B) platforms. Individual consumers are the primary audience, with households using AVOD services to access content at no cost, while businesses utilize AVOD platforms for targeted advertising campaigns. As more consumers shift to digital streaming and cord-cutting continues to rise, the demand for free ad-supported services will grow, making AVOD an increasingly viable option for both content providers and viewers. Furthermore, AVOD platforms are witnessing growth across mobile devices, smart TVs, and other connected devices, contributing to the market's expansion.

Regional Insights

North America remains the largest region in the AVOD market, driven by the strong presence of leading AVOD platforms like YouTube, Hulu, and Peacock. The region benefits from a mature digital infrastructure, widespread internet access, and a high consumer demand for streaming services. As 5G networks and high-speed internet continue to expand, the AVOD market in North America is expected to maintain its dominant position.

In contrast, the AVOD market in the Asia-Pacific region is experiencing rapid growth, with countries like India and China leading the charge. The rising internet penetration in these countries, coupled with a growing middle class and an increasing preference for mobile-first video consumption, is propelling the demand for AVOD services. As local players enter the market and global companies expand their reach, the Asia-Pacific region is expected to witness the fastest growth during the forecast period.

Market Drivers

One of the primary drivers of the AVOD market is the increasing demand for free content. With rising subscription fatigue and the growing cost of pay-TV services, many consumers are turning to AVOD platforms for free entertainment. This shift in consumer behavior has led to the expansion of free ad-supported services. Additionally, the proliferation of high-speed internet and mobile connectivity plays a critical role in the market's growth. The rollout of 5G networks, in particular, has significantly improved the quality of streaming, making AVOD platforms more attractive for viewers looking for seamless and high-definition video content.

Another driver is the increased demand for live-streamed content, particularly in sports and entertainment. Consumers are eager to access live events without the constraints of traditional cable packages, and AVOD platforms provide an ideal solution. As broadcasters and content creators increasingly rely on AVOD services to distribute live sports and events, this segment is poised to drive market expansion in the coming years.

Market Restraints

Despite its rapid growth, the AVOD market faces several challenges. One of the primary restraints is the competition from other video-on-demand models, such as subscription-based video-on-demand (SVOD) services like Netflix and Disney+. While AVOD platforms offer free access, they must rely heavily on ad revenue, which can fluctuate depending on market conditions and audience engagement. This reliance on advertising revenue can create challenges in maintaining consistent revenue streams, especially in times of economic downturn or when advertisers cut back on spending.

Another restraint is the issue of ad saturation. As more platforms adopt the AVOD model, the volume of ads shown to viewers increases, which can result in consumer fatigue. Over time, too many ads may lead to a decrease in viewer satisfaction, potentially reducing engagement rates. For AVOD services to remain attractive to consumers, providers will need to balance the number of ads with the quality of the viewing experience.

Market Opportunities

There are several opportunities within the AVOD market, particularly as new technological advancements emerge. The growing use of artificial intelligence (AI) and machine learning (ML) in ad targeting presents a significant opportunity for AVOD platforms. By offering more personalized and relevant ads to viewers, AVOD services can improve user experience while increasing ad effectiveness. This would help to drive higher ad revenues and potentially reduce viewer dissatisfaction.

Additionally, expanding into new regional markets presents a significant opportunity for growth. As internet penetration increases in emerging markets, such as in Africa and Latin America, the demand for free ad-supported video content will rise. This provides AVOD services with the chance to tap into untapped markets and further expand their user base. Furthermore, partnerships with content creators and advertisers could help AVOD platforms strengthen their content offerings and diversify their revenue streams.

Reasons to Buy the Report

✔ Gain a comprehensive understanding of the global AVOD market's size, growth prospects, and market dynamics.
✔ Identify key growth drivers and market segments to develop informed business strategies.
✔ Discover regional trends and opportunities, particularly in emerging markets like Asia-Pacific and Latin America.
✔ Access in-depth competitive analysis of leading players and recent market developments.
✔ Utilize actionable insights to make data-driven decisions on investment and expansion in the AVOD industry.

Frequently Asked Questions (FAQs)

1. How Big is the Ad-Supported Video on Demand Market?
2. Who are the Key Players in the Global AVOD Market?
3. What is the Projected Growth Rate of the Ad-Supported Video on Demand Market?
4. What is the Market Forecast for the AVOD Market by 2031?
5. Which Region is Estimated to Dominate the Ad-Supported Video on Demand Market through the Forecast Period?

Company Insights

Key players in the Ad-Supported Video on Demand market include:

• Google (YouTube)
• Hulu
• Peacock
• Tubi TV
• Vudu
• Roku

Recent developments in the AVOD market include:
1. Hulu launching an enhanced ad targeting system, enabling advertisers to reach more specific audience segments.

2. Tubi TV expanding its content library by partnering with major studios to offer more free movies and TV shows.

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