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Screenshot: IMDB.com

Over-the-top digital streaming TV companies that don't charge people for access are rising as consumers face saturated budgets for subscription content.

Why it matters: While data shows consumers today are generally less tolerant of ads, the rise of these services shows that there's still an appetite for advertising if it's relevant — and if it means consumers can access their favorite content without having to pay a subscription fee.

Driving the news: On Thursday, Amazon-owned IMDB launched Freedive, a free, ad-supported streaming video channel featuring hit movies and TV shows. The Freedive app can be viewed on mobile, desktop or on Amazon Fire TV devices.

Free, ad-supported streaming services are rising, as subscription streaming services face stiff competition for consumers' budgets.

  • Roku's free ad-supported channel, The Roku Channel, is the No. 3 ad-supported channel on the company's platform; it has about half the advertising per programming hour of traditional linear TV.
  • Hulu's ad-supported business continues to grow, with the company announcing over $1.5 billion in yearly ad sales this week.
  • Even telecom companies, like Dish and AT&T, are beginning to offer free tiers or products for streaming, like AT&T's "Watch" streaming service, which launched last year.
  • Free TV services like Xumo and Pluto TV also continue to grow their subscriber bases, as Digiday's Sahil Patel noted last year.

Between the lines: Some of these ad-supported streaming companies, which rely on new-age addressable (digitally automated) TV ads instead of traditional TV ads, could build lucrative businesses.

  • Both Roku and Hulu have increased their ad revenues by more than 50% years over year.
  • Roku’s ad revenue increased 57% from 2017 to 2018. At this point, its advertising business is growing faster than its hardware business, a sign of investment in the company’s free ad-supported channels.
  • While both are still relatively small in their share of the total digital advertising pie, they are expected to grow quickly over the next two years, per eMarketer.

Be smart: One reason these free services are growing fast is that they have become a win-win for manufacturers who need to add apps to new smart TV lineups and for programmers who need wider distribution for their content.

Go deeper

Updated 27 mins ago - Politics & Policy

Coronavirus dashboard

Illustration: Eniola Odetunde/Axios

  1. Health: Most vulnerable Americans aren't getting enough vaccine information — Fauci says Trump administration's lack of facts on COVID "very likely" cost lives.
  2. Education: Schools face an uphill battle to reopen during the pandemic.
  3. Politics: Biden unveils "wartime" COVID strategyBiden's COVID-19 bubble.
  4. Vaccine: Florida requiring proof of residency to get vaccine — CDC extends interval between vaccine doses for exceptional cases.
  5. World: Hong Kong puts tens of thousands on lockdown as cases surge — Pfizer to supply 40 million vaccine doses to lower-income countries.
  6. Sports: 2021 Tokyo Olympics hang in the balance.
  7. 🎧 Podcast: Carbon Health's CEO on unsticking the vaccine bottleneck.
Bryan Walsh, author of Future
4 hours ago - Health

Schools face an uphill battle to reopen during the pandemic

Illustration: Aïda Amer/Axios

President Biden's plan to accelerate the reopening of K-8 schools faces major challenges from a still out-of-control pandemic and more contagious coronavirus variants.

Why it matters: The longer American kids miss in-person schooling, the further they fall behind. But the uncertain state of the science on the role young children play in the pandemic continues to complicate efforts to reopen schools.

Focus group: Former Trump voters say he should never hold office again

Illustration: Sarah Grillo/Axios

"Relief" is the top emotion some swing voters who used to support Donald Trump say they felt as they watched President Biden's swearing-in, followed by "hope."

Why it matters: For voters on the bubble between parties, this moment is less about excitement for Biden or liberal politics than exhaustion and disgust with Trump and a craving for national healing. Most said Trump should be prohibited from ever holding office again.