Vevo inked a new deal to add 11 channels to Amazon’s Freevee, marking the latest momentum as it works to bring music videos back to linear television and become a mainstay on connected TV and free ad-supported streaming TV (FAST) services.
Including holiday pop-up channels Vevo now has nearly 150 linear FAST channels globally, with 66 launched in 2022 alone. Before Freevee, Vevo this year became part of channel lineups on Plex, The Roku Channel and TelevisaUnivsion’s ViX, among others. It also added six channels to Hulu + Live TV virtual MVPD service in November.
The new music video channels coming to Amazon’s Freevee include Vevo Pop, Vevo Country, Vevo Hip Hop, Vevo R&B, Vevo Latino, Vevo Reggaeton & Trap, Vevo ‘70s, Vevo ‘80s, Vevo ‘90s, Vevo ‘2K, and Vevo Holiday. Additional launches on the platform in European territories are teed up for 2023. It expands Vevo's relationship with Amazon as its app is already available on Fire TV and Echo Show.
In an interview with Fierce Video, Vevo President of Sales & Distribution Kevin McGurn acknowledged the company’s benefited from some luck in timing to bring music videos back to TV lineups.
“The music video had kind of been wholly dismissed from linear programming 2006 with YouTube,” he noted. “For us to have come all the way back through and have it be on a proper channel guide in and amongst cable television is just really fun for us.”
And Vevo, a joint venture of Universal Music Group and Sony Music Entertainment that was founded as a YouTube-first company, already has all of its content available for free and in an ad-supported way, meaning that as it’s looked to build a TV presence it was never confused about wanting to build a subscription service or needing to own the relationship with the end customer.
With a place as a syndicator, McGurn said it’s following a ubiquitous distribution strategy to leverage the effort, time and money being spent by large corporations (such as the Samsungs, Rokus, Apples and Amazons) “to get our content back in the living room where people can watch it and where advertisers can benefit from associating themselves with culture and trend.”
Roughly 30% of Vevo’s views now come through the TV screen, with a total U.S. audience of 150 million viewers across platforms and a U.S. CTV audience of 65 million viewers per month.
According to McGurn, based on models and what it’s seeing in early returns from partnerships like Hulu, Vevo is “growing quite a bit” from expanded distribution on streaming services - and riding the rising tide as platforms themselves grow alongside shifts in content, viewership and monetization on streaming.
“The popularity of music videos generally benefits disproportionally from when these services grow because it’s such a universal opportunity for people to watch something they wouldn’t typically find on the dial,” McGurn said.
While he said there’s interest in carrying Vevo channels on FAST platforms, the conversations aren’t always easy– as McGurn noted that as a music company the way Vevo licenses and monetizes content is much different than a typical studio-network relationship.
“The label and publishing rights that we have to pay royalties on is a far more complex environment than what you would find in television or film, so that’s one of the things that makes it difficult to do those deals,” he noted.
However, on the flip side, because it’s different from a typical network (for example, by putting all of its content on YouTube), the company can ink deals without worrying about cannibalizing any legacy business. Vevo typically follows either an advertising revenue share model or an inventory share model, with a preference for the latter as its more akin to a traditional MVPD deal, according to McGurn.
Evergreen content and a lean-back experience
As a music video company Vevo benefits from a few aspects that are unique compared to traditional content companies, both from a programming and an advertising perspective.
For one it has very little seasonality, with a constant stream of new video content that comes in weekly. And unlike shows that people may binge and not view again, music videos tend to be much more evergreen.
“You don’t have to worry about what show is coming up and when, or how quickly they’re [viewers] going to binge it. We have brand new content that is sourced in such a large quantity, and actually is produced very quickly and released very quickly,” McGurn said, adding TV series or films that may take a year to create versus songs that are written every day with music videos produced shortly after. “So we feel good about our longevity and the freshness of our content.”
The size of Vevo’s library is continually growing and currently stands at over 700,000 video assets, McGurn said, of which a smaller subset is programmed on TV platforms.
But in a world where consumers can hop on YouTube or other platforms to find just about any music video they want, are viewers tuning in to watch music on a pre-programmed network-like channel? According to McGurn, the answer is yes.
“What we found through these FAST services, a lean back experience was a much better way to present music videos,” as it’s too much work for people to try and find a new video to watch every four minutes. “The mass majority of people want to be programmed to.”
And Vevo leans on YouTube to inform its 24/7 linear programming. McGurn said YouTube is the greatest indicator for popularity, and Vevo follows what people watch and tune into next.
“We have like the biggest AB tests ever to figure out what we want to program…and we use that all the time.”
It appears to be paying off, as he said Vevo’s average length of tune in across services is generally over 30 minutes, he said. That’s particularly interesting considering that unlike TV shows or movies that give consumers the chance to change the channel every 30 minutes to two hours, viewers of Vevo music videos could technically move on or pick something new to watch after just four minutes.
“At the end of the day the music industry does a really good job of knowing ‘if you like this one thing, you’re probably going to like that thing too,’” he commented, adding that music in general has a more universal appeal, helping to keep people on Vevo channels a lot longer.
For programming, Vevo takes a similar approach across platforms for the genres of their music video channels but can dial in somewhat depending on a service’s base and who it caters to – such as skewing younger, or male, or based on geography, where some might lean more towards country than say hip hop. This also provides opportunities for addressable advertising given the variety of subcultures that identify with different artists across Vevo’s network.
And with a variety of channels (from six on Hulu to up to 15 on Samsung TV Plus), he views it as a hybrid of linear and on-demand, saying if you stick within the Vevo universe “you’re going to find something you like that’s on at any given time.”
Vevo also has its own on-demand app on CTV and while McGurn acknowledged there’s a base of viewers who still only want to watch music videos they select, internally, he said the company likes to follow the phrase “lead with linear.”
“Because we’ve seen people watch more, and subsequently we get more ad inventory through linear playout than we do with video on demand,” he said.
‘Flight to quality’
Vevo focuses on official music videos with high production quality, which McGurn views as part of the appeal for consumers and advertisers.
Vevo generates all of its revenue from advertising and CTV has become a major part of the business. The CTV medium now makes up 50% of Vevo’s total ad revenue – a massive surge from the 4% CTV accounted for in the first quarter of 2020.
As CTV garners more dollars from traditional linear alongside ratings declines, he believes Vevo will disproportionately benefit – citing “a little bit of a flight to quality” – with the expectation for ad budgets that might have gone to social or digital in the past instead shifting to platforms with deeper engagement and brand affinity.
“We’re highly curated, brand safe, professionally generated video, that on a production value level, we’re up there with Game of Thrones, close to $1 million dollars a minute – you just do it four minutes at a time,” he noted.
In the coming year, McGurn said one should expect Vevo to start looking more and more like a traditional TV network, having already incorporated non-music video assets like artist call outs, cross-promotion to other channels and upcoming premiere alerts that the buying community is used to on TV.
It also wants to start incorporating more longer-form content and live concert footage.
“The good news is we get brand new music videos every single week and ever week of the year, delivered to our doorstep. And not every content producer can say that,” he noted.
And with FAST a key focus, Vevo also sees international expansion as its largest growth opportunity – further helped as streaming services also expand around the world and partners that have global business (such as Samsung, Apple, etc).
That said, McGurn believes the industry in general is heading toward more reconsolidation, and as that happens Vevo wants to ensure its part of the mix.
“What we want to do is secure beachhead in all of these services, so as it does consolidate we are an integral and vital part of their content lineup that they feel is a service to their end consumer to have them sign up in the first place [and] to keep them around watching,” he said.