The times will suit FTA TV as households turn to “free”

Economic pressure and the rise of BVOD are stabilising FTA TV reach as consumers pivot to ad-supported services.

David Kennedy · Venture Insights8 November 2024Period: FY244 min read

8%↓

Drop in inflation-adjusted household disposable incomes (2022-2024)

2017→

Year to which household purchasing power has returned

Locked

Companies covered:

Abstract

This report analyses the sharp increase in FTA TV reach during FY24, challenging the narrative of inevitable decline. It argues that significant economic and policy drivers, including an 8% drop in inflation-adjusted household disposable incomes, are pushing consumers toward free, ad-supported services. While SVOD growth has stalled following the pandemic, the surge in BVOD uptake is providing a new foundation for the industry to stabilise its business model and reassert its value in the advertising ecosystem.

Key Takeaways

FTA TV reach saw a sharp increase in FY24, driven primarily by a surge in BVOD uptake while broadcast reach remained steady.
Australian households suffered an 8% drop in real disposable income over the last two years, the largest fall in the OECD.
Household purchasing power has been pushed back to 2017 levels, leading to a significant decline in SVOD subscriptions.

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Frequently Asked Questions

Household budgets are under extreme pressure following an 8% drop in inflation-adjusted disposable income over the last two years. This economic contraction has reset consumer purchasing power to 2017 levels, forcing a migration from paid streaming services back to free, ad-supported platforms.

The shift is structural, as economists estimate it will take at least two years of sustained wage growth to recover the spending power lost to inflation. With broadcast FTA TV maintaining a 75% reach, the industry is using this window to transition viewers toward BVOD platforms that offer more sustainable digital revenue streams.

The transition is margin-accretive because BVOD advertising currently generates higher revenue per viewer than traditional broadcast commercials. This higher yield, combined with a 'flight to quality' among advertisers, allows media companies to stabilize their business models even as traditional linear viewing evolves.

The times will suit FTA TV as households turn to “free”

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