The Emergence Of HD Was FAST, Too.

There is a reckoning coming to the 2,000+ Free Ad-Supported Television (FAST) channel universe here in the US. Relax. It’s not the mass casualty event we have all been led to believe. Unlike traditional linear platforms (broadcast, cable, satellite) which are limited by bandwidth and high-priced channel slots, FAST platforms offer full digital delivery where data use is charged back to the channel provider by hours of viewing measurement and offset by ad revenue CPMs.

This will be an oversimplification, but in terms of scale, think of a FAST platform (Samsung TV Plus, Roku, Pluto, LG Channels, etc.) as the great plains of the United States. Now imagine each channel as a stagecoach seeking purchase. Even with 300, 400, 500 FAST channels, the only limit to the number of channels who can join the land grab is the efficacy of the stagecoach. And the channel providers pay for the privilege to claim square footage on virtually limitless plains of cloud data. It's not a limited bandwidth play like the old days. Welcome to the gold rush town of CDNs, white-papered S&Ps, and turnkey channel launchers outfitting willing and eager content creators and aggregators on the edge of the FAST frontier.

But what about the platforms hosting these brave new FAST channels? Faced with the prospect of supporting an unlimited number of destinations, platforms are now asking themselves, “How many channels are really worth the effort, and how do they help define my offering?” It’s an incredibly fortunate position to be in. The selective repercussions will advance the editorial evolution of FAST channels that are able to scale and force the retirement those who can’t evolve.

I’m not going to dive into the details on numbers that many capable tech bloggers and researchers have quoted ad-nauseum, but the truth is that where Madison Avenue once turned its attention to FAST to see if it can live up to the “cut-the-cable” hype, the agencies are now firmly asking platforms how they intend to maintain growth.

Expected to triple over the next five years with advertising investments in the tens of BILLIONS of dollars, the question isn’t if, but when FAST will tip the linear TV scales. To take a page out of television history, let’s set the Way Back Machine to the early 2000’s, and the advent of another cutting-edge audience magnet, high definition.

In 2003 I worked in programming and development for one of the first stand-alone HD networks in the United States. One of a universe of four channels; ESPN HD, HBO HD, Mark Cuban’s HDNet, and my outfit, Discovery HD Theater. The home of Sunrise Earth, Chasing Classic Cars, Mecum Auto Auctions, top partner content from within Discovery Nets, NASA shuttle launches and weekly reports (some in 3D!) from JPL’s Mars probes. Our team was incredible. Those editorial choices weren’t accidental. And I’m recognizing a few parallel characteristics in the adoption of FAST channels that were readily apparent during the world’s relatively swift transition from standard to high definition.

Today, as audiences continue to turn away from traditional pay TV and a cornucopia of niche subscription platforms, FAST channels are filling the void for millions of disconnected consumers roaming the media wilderness searching for a safe, recognizable, passive linear experience to plant their couches in front of.

Major networks and content libraries big and small around the world have taken notice. FAST channels are exploding. As the heir apparent of next generation linear TV, you’ll see more hybrid (read: FAST) versions of existing linear platforms populate on the various free ad-supported television platforms. These are not simulcast channels, standing distribution deals prevent that. These are entirely new offerings. Some carry similar channel names as their traditional linear counterparts, but their EPGs are vastly different, mostly with older seasons of popular content and back-of-the-rack playlist choices that wouldn’t make the cut on their traditional mothership channels.

Many FAST offerings are Single IP, or Double IP entertainment channels; One channel dedicated to a solo title or two related franchises paired for increased draw. For example, a few of the most widely distributed Single IP FAST channel offerings are Forensic Files, America’s Test Kitchen and Baywatch. Easily searchable and identifiable brands that audiences can switch on and binge — drawing advertisers like sharks to the chum.

The early days of high definition was all about technology adoption. As with any new tech, HD was an expensive entry in its infancy. A luxury where major players waited to gauge consumer acceptance before truly investing in content. The studios had time to hone best practices for digitally converting their 35mm, 70mm and IMAX feature films to HD. Shooting in HD for TV was challenging, from new cameras to forcing entire flips of ops infrastructures to handle the influx of new content. When I sat on panels around the world breaking the news as gently as I could to many of the world’s most accomplished documentary producers that their coveted 16mm film libraries wouldn’t hold up in this new widescreen digital window, I was nearly stampeded out of a few auditoriums.

I fielded questions like, “Why do I need HD when I have PAL?” and, “Up-conversion really isn’t that bad.” While I sympathized with those sentiments at the time, those takes really haven’t aged very well. But I also urged them not to shoot the messenger; Quality was a demand of the well-educated early adopter consumer electronics community investing thousands of dollars into plasma flat screens.

Scalable technology scrambled to fill the void. A sea change of new 1080p cameras that ran into the six figures were required. Demand forced innovative companies like Sony and Panasonic to reinvent data transfer from Digi Beta and HD Cam tapes to recordable hard drives. Digitization allowed vast tape media libraries to become leasable office warehouse space. Where digital itself made things smaller, HD inspired the media world to scale to delivery demand. Today you can shoot and edit near broadcast quality HD on your smartphone.

The begrudging evolution from standard def 4:3 NTSC/PAL/SECAM to nearly universal HD formats (save for those pesky frame rates) was made faster because of consumer demand. It was cool to hang a 75 pound, 42-inch energy draining plasma flat screen on your wall and spent $5,000 to do it. Microsoft’s Xbox would offer an HD DVD add-on. Sony’s Playstation3 offered direct Blu-ray playback which would eventually seal the win for Blu-ray as THE home video HD platform. Where Sony once fumbled the rollout of Betamax, they claimed platform revenge with Blu-ray.

Eventually, the prohibitive costs of playback tech dropped to an attainable level on a mass consumer scale and the demand for HD spread like wildfire. We called it “The Cul-de-sac Effect;” Where the Jones’s would have their neighbors over to watch The Masters or the Super Bowl on their new flatscreen HDTV, and those neighbors just HAD to have one for themselves. In the years before social media, it was the power of word of mouth and online A/V forums that spread the word of HD like butter on a hot muffin. Even two decades later, the month following the Super Bowl is still the best time to land a deal on a new widescreen.

On the content provider side, studios and networks who thought they had seven to eight years to catch up with the curve were now faced with HD sets flying off the shelves and a shortage of content to program for them. 7-8 years quickly morphed into 4-5 years for turnaround to 100% HD format adoption. By the end of 2008 all broadcast and a majority of cable channels and premium networks offered an HD simulcast feed. And chances are you were paying your cable company a premium for the benefit of accessing their tier. The tech evolved in leaps and bounds, but the distribution model was the same.

Today, as consumers continue to cut the cord and turn away from cable and/or myriad subscription television services, FAST is becoming the next generation of passive television enjoyment. Remember those single IP FAST channels I mentioned? Consider them in the same vein as the early HD channels; wow-factor placeholders for the major libraries and networks to establish a foothold and test the waters. IP-based FAST channels are an incredible gateway to draw in audience and advertisers alike. And like those pioneering HDTV buyers, the FAST channel dependent will inevitably ask, “What else is there?”

While not a new technology, the audience’s inevitable desire for fresh content will drive platforms to find channel partners willing to make that investment. This is the analogy that tethers HD and FAST as evolutionary steps in the history of television.

As I hinted at earlier, many of the Single or Double IP FAST channels are fed by major studios and distributors who are contractually obligated by existing linear and pay TV distribution agreements to continue saving their best for the aging platforms. This is why you won’t see recent seasons of your favorite series on FAST. The ad dollars won’t migrate until the content does. But the time is coming.

Until those existing, multi-layered content and traditional channel deals expire, content proprietors can take the time to learn how to program to the FAST audience. They are also investing in content that has FAST rights baked into their original production deals. Like HD, FAST is a new content arms race, and the cost per hour for licensing FAST rights today are just as expensive as traditional pay TV. You read that correctly. Producers and distributors are already there.

Combine the explosion of FAST channels in the US with the leveling up of content licensing fees, the exodus of consumers from traditional linear subscriptions, a glut of retro TV shows collecting dust on old hard drives, the fact that we now carry our TVs in our pockets, and you’ve got the recipe for FAST channel adoption in the US, and an accessible test bed for global expansion of your library.

Unlike the migration to HD, there won’t be an industry-wide shift to FAST where traditional nets simply change over and linear as we know it will go by the wayside. At least, not immediately. There will still be linear consumers to advertise to. But when the major streamers, TV networks, studios and even a few of the established FAST platforms themselves focus on producing content directly for FAST – just like the accelerated adoption of HD by the mid 2000’s – as long as the advertisers continue to buy in, the projected consumer tipping point to FAST will happen more rapidly than anyone expected it to. The current market reflects a four-to-five-year window for ad rates to mature. In the meantime, look for FAST platforms to start culling the lesser-performing FAST channels.

Platforms will keep the channels that are positioned complement their own distribution models. The IP’s are the gateway drug. But as always, content is king. The channel creators who can hybridize and evolve their editorial offerings for a FAST audience will be the new moguls. You haven’t missed the rush. It’s still the wild west, folks. But with FAST, the world should be your focus. If you’re only thinking about the US, you’re shorting your own stock.

The global gold rush is just getting started. Getting in ahead of the curve with a scalable channel that features renewable offerings, bankable off-platform library content, a reliable localization path, and flexible content rights will be the most effective way for any new content player to diversify their monetization as the majors play catch up. A game that won’t take them long to master.

Whatever happened to Discovery HD Theater, you may be wondering? It rebranded into HD Theater while I was there, then Velocity Channel, and today it is known as MotorTrend. And Chasing Classic Cars is still there! Editorial strategy is no accident, folks. Establishing brand definitional tentpoles and future proofing your content is always the best insurance against the unseen forces of format shifts and platform expansion in media.

The reality is there’s a $25 billion-dollar FAST channel advertising market to be had. When audiences talk about their experience on a FAST platform, will your brand be remembered? How will your content compete? Create your own Cul-de-sac Effect within the dedicated streaming communities you already provide content for. Success is attainable. Let’s work together to get you there.