Smart TV maker Vizio is tapping Whip Media’s software platform to help manage ad revenue reporting and automate payments to content partners for its free ad-supported streaming TV (FAST) service WatchFree+.
According to Whip, the quick growth of WatchFree+ meant Vizio needed a new system to scale and handle the high volume of deals to manage and streamline ad revenue reporting, along with calculations and payments to partners. Under the new deal, Whip Media’s platform will process performance data for ads served to viewers watching WatchFree+ linear FAST channels and on-demand content, to quickly calculate ad revenue royalties for third-party content partners.
Vizio is one of the leading smart TV makers in the U.S., with over 17 million active accounts. It’s free WatchFree+ service, available through the smart TV maker’s home screen and interface, includes more than 260 channels and over 6,000 movies and shows. For Vizio, finance chief Adam Townsend in a statement highlighted the ability to automate account management across an expanding list of content partners and titles.
“Vizio’s partnership with Whip Media comes at a time when the entertainment world continues its shift toward more automated account management,” said Townsend in a statement. “This partnership gives us the ability to quickly scale and process ad revenue data efficiently across a growing list of thousands of titles and for hundreds of content partners.”
Whip Media’s VP of sales Vince Muscarella said in a statement that by working with Whip, “Vizio can now automate the depth and velocity of licensing” in the streaming age.
“Our partnership will allow Vizio to streamline financial reporting for their growing library of AVOD and FAST programming on their Connected TV platform,” Muscarella said. “With this new approach, Vizio can focus on what it does best – deliver high-quality content to its viewers through its WatchFree+ streaming service.”
Whip media manages performance tracking and revenue management for more than 60% of VOD and EST transactions each year for film studios and distributors across more than 1,100 global platforms and a growing number of FAST and AVOD providers.
The FAST space in particular has been pegged as poised for ad revenue growth. Analysis by firm TVREV earlier this year projected FAST services will attract $33.7 billion, or 35% of total ad spend, by 2025.
WatchFree+ has become a larger part of Vizio’s business, as free streaming TV options attract eyeballs and ad dollars follow suit. In the fourth quarter Vizio’s platform revenue helped offset a slowdown in hardware revenue. Platform revenue, which includes its home screen and video products as well as WatchFree+ grew 30% year over year to $136.5 million in Q4, a new quarterly record. For the full year 2022 platform revenue jumped 55% over 2021 to $477.9 million. Vizio isn’t the only TV OEM pursuing FAST, as Samsung and LG each have respective services, Samsung TV Plus and LG Channels. Those come alongside media-owned FASTs like Pluto TV and Tubi, as well as The Roku Channel and Amazon Freevee, among others.
Speaking at the Morgan Stanley Tech, Media and Telecom conference in March, Townsend said SmartCast and WatchFree+ has become an increasingly important part of the overall revenue strategy.
"It's the highest destination for monetization that we have on the platform," Townsend said. "We've been really pleased with the growth in WatchFree Plus." He noted the company now has more than 400 advertising partners representing brands across sectors. Townsend also shed some light on the revenue sharing structure with content partners as Vizio works to program the free streaming service.
"For us, as the distributor, it's a very low-risk proposition," he said. "It's a partnership where a revenue sharing structure happens — we bring in the content, our ad team sells it, and we share revenue back to the partner. If no one watches it, we didn't spend any money, and we're not going to make any money. But if someone does watch it, then we're both in the game together."
However, managing a growing number of content partners and more crowded ecosystem can also present challenges for FASTs.
Speaking to Fierce earlier this month about Sling TV’s new FAST, Freestream, Dish Media SVP Kevin Arrix cited complexity in coordinating with a variety of partners. In Freestream’s case, he explained that Dish itself keeps a percentage of the inventory, the content creator or owner gets a portion, and then when the FAST is distributed on an OEM such as Vizio, Roku, Samsung or others, the TV makers also get a portion of the inventory – with “multiple entities selling into the same sort of content channels,” said Arrix. For Freestream, he said Dish is working on setting rules, guidelines and expectations with partners to streamline and adhere to.
As for Vizio, it’s been enhancing its ad experience, including through a partnership with Brightline that served to bring interactive ad breaks across hundreds of linear channels on WatchFree+, enhancing existing 30-second spots. The deal marked the first smart TV integration for Brightline and its OTT Accelerator program. Vizio also said through the integration that it was the first smart TV OEM to offer advertisers the ability to enhance their commercials with interactive features.