What's the difference between subscription-only and ad-supported streaming?

Subscription-only streaming services (like Netflix originally was) earn revenue solely from monthly subscriber fees. Ad-supported streaming adds advertising as a second revenue source, either by offering a lower-priced tier with ads or including ads in free content. Many streaming services now use a hybrid model with both subscription and ad revenue, which potentially increases their earnings per user while giving viewers pricing options.

Why is live content so important for streaming services?

Live content, especially sports, creates 'must-see' viewing events that attract large simultaneous audiences. This is valuable because it generates higher engagement, reduces subscription cancellations, and commands premium advertising rates. Live content also creates communal viewing experiences that can't be replicated through on-demand libraries, giving streaming services another way to differentiate themselves in a competitive market.

What is ad tech and why does it matter for streaming?

Ad tech (advertising technology) refers to the software and tools that enable digital advertising to be bought, sold, delivered, and measured. For streaming services, sophisticated ad tech is crucial because it allows for precise audience targeting, real-time bidding on ad inventory, and detailed measurement of campaign effectiveness. Better ad tech means streaming services can charge higher rates for their ad space, making advertising a more profitable revenue stream.

What are 'Market Cap' and 'Projected Profit'?

Market Cap (Market Capitalization) is the total value of a company's outstanding shares, calculated by multiplying the current share price by the number of shares. It indicates a company's size in the market. Projected Profit refers to analysts' predictions about how much money a company will earn in the future, usually the coming year. These forecasts are based on company guidance, industry trends, and financial models, though they're estimates rather than guarantees.

18 handpicked stocks

Streaming's Advertising-Powered Live Content Revolution

Netflix has proven that combining advertising, subscriptions, and live sports creates powerful growth. This carefully selected group of stocks represents companies positioned to benefit from this new streaming business model, from content providers to the ad tech making it all possible.

Han Tan | Market Analyst

Updated 2 days ago | Published at जुलाई 18