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LOS ANGELES — Netflix, Amazon and other media giants are spending billions trying to lure subscribers with big-budget, award-worthy shows. But most nights, Jake Goodman just wants to come home and throw on retro cartoons like he did as a kid.
Goodman, a radio DJ in Oklahoma, said he doesn’t subscribe to any of the paid streaming services, so he pulls up Pluto TV, one of a group of free, advertising-supported platforms with a sprawling library of reruns and old movies — and a clear-cut sales pitch.
“The bottom line is you’re getting television service for free,” said Goodman, 24.
Pluto TV and the other free streaming services that have emerged in recent years are built on the idea that consumers will put up with old-fashioned commercial breaks if they can avoid shelling out $6.99 to $14.99 in monthly subscription fees to the big digital players.
At least one major entertainment company sees a business opportunity. The media conglomerate Viacom bought Pluto TV in January for $340 million, and a variety of other free services have popped up in an effort to fill the just-got-home-from-work TV gap.
“Everybody appreciates a well-curated content offering that also happens to come at the price of free, whether you’re rich or middle-class or poor,” said Tom Ryan, Pluto TV’s chief executive and co-founder.
Inside Pluto TV’s offices at West Hollywood’s 1.6-million-square-foot Pacific Design Center, just a 17-minute drive from Netflix’s Southern California headquarters, Ryan eased into a glass-lined conference room and explained the big picture. The company, founded in 2013, has steadily added channels and viewers, and it now counts roughly 15 million monthly active users.
Ryan and his competitors — a list that includes quirky-sounding upstarts like Tubi, Xumo and IMDb Freedive — are challenging the conventional wisdom that the future of television revolves around paid subscriptions. They’re betting on a no-cost, low-maintenance alternative.
“If you want to watch a serialized drama, one episode after another, on-demand is great,” Ryan said of streaming services. “But there’s a lot of work to do when you want to be entertained. … The endless list of choices, and you end up sitting there for 20 minutes.”
“But people are fundamentally creatures of habit,” Ryan added. “They want to be programmed to, and in a world of infinite choice … making things easier for people is a really valuable thing to do.”
I want my free TV
Pluto TV leans heavily on the television equivalent of comfort food: throwback sitcoms, vintage movies, reality shows and nature specials.
And the content offerings aren’t the only part of the service that might remind consumers of traditional television. Pluto TV’s main menu resembles a cable television guide, allowing the service’s users to scroll through a grid featuring hundreds of channels, including Viacom-owned brands like Nickelodeon, MTV and Comedy Central.
The recent influx of Viacom-owned content, from MTV’s reality favorite “The Hills” to Nickelodeon’s nostalgia-tinted animated series “The Fairly OddParents,” sits alongside other channels that approximate a classic cable bundle: news (including content from NBC News), sports highlights, movies and music.
And like cable television, Pluto TV’s channels stream content constantly, treating users to a 24/7 feed that unspools in real time. Users can dive into the middle of an episode of “Forensic Files” or catch the last few minutes of a 1970s mystery flick. What they can’t do is rewind, start over or skip the credits like Netflix-style on-demand services.
“I’ve missed that experience,” said Jacob Carlton, 23, a forklift driver at a car warehouse in Shelbyville, Tennessee. “It reminds me of the antenna TV we had when I was a little kid."
Data from the research firm MoffettNathanson suggests commercials and linear programming aren't deal-breakers even for Netflix users. The firm asked Netflix subscribers to rank their top reasons for sticking with the service. The lowest-ranked reasons? "I like not being interrupted by ads" and "I can choose what to watch."
Pluto TV’s content lineup, including its library of on-demand movies and shows, also errs on the eclectic. The service recently rolled out “pop-up channels” for the Animal Planet series “River Monsters” and the A&E series “Wahlburgers,” a reality show about the cheeseburger chain co-owned by the acting brothers Mark and Donnie. That’s in addition to channels devoted to anime, video games, the science-fiction cult favorite “Mystery Science Theater 3000” and a station featuring footage of trains passing through Norwegian landscapes.
Josh Stevens, an electronic records processor at a medical facility in North Canton, Ohio, said the fare on the Nickelodeon-branded channel— especially the 1990s-era horror anthology “Are You Afraid of the Dark?” — has kept him coming back.
He said he gets annoyed with the commercials every now and then, particularly when they abruptly cut into a show in the middle of a scene, but he was quick to add that the trade-off was worth it.
“As someone who graduated from college in 2016, with a bunch of student loans, the more free stuff I can get, the better,” Stevens said.
“Game of Thrones” was the only thing that took him away from Pluto TV on a recent Sunday night.
Instead of relying on subscriber dollars, Pluto TV and other so-called FASTS (free ad-supported streaming services) make money from digital TV ads that are seen as a booming growth area, according to a recent report cited by Axios.
Pluto TV, for its part, generated more than $70 million in ad revenue in 2018, tripling its haul from the previous year.
“It’s still a relatively small player when you look at the entire digital advertising landscape,” said Dan Cryan, a director at the research firm MTM London.
“But advertisers might be attracted to Pluto TV because they can avoid the risks you get with YouTube and Facebook,” Cryan added, referring to the problematic video content that sometimes crops up on those platforms, such as conspiracy theories.
Pluto TV is a budding brand name in major metropolitan markets like New York and Los Angeles thanks to an aggressive marketing blitz. (Ryan declined to disclose how much the company has spent on traditional and digital advertising.)
The company’s fleet of billboards and bus displays have become so ubiquitous that its employees snap photos whenever they see multiple ads on the same city block and then share them on the messaging platform Slack, Ryan said.
But the service also appears to be resonating in more rural and sparsely populated regions of the country. Google data from the last two years showed that search interest in Pluto TV was not evenly distributed, with people in large cities far less likely than those in rural areas to search for it.
Ryan declined to comment on the company’s target demographics. But in the months to come, he said, the company hopes to reach more Latino viewers with a wider slate of Spanish-language offerings.
Pluto TV's rise comes at a chaotic time for the entertainment business. It's not just that the service is competing against similar platforms like Tubi and Xumo. The company is also scrambling for viewer attention in a crowded market. Netflix, Disney, AT&T, Comcast and Apple are fighting for digital dominance — and all the while, according to one report released last year, American consumers probably have room for only about four streaming apps in their media diet. (Comcast owns NBCUniversal, the parent company of NBC News.)
Ryan, for his part, knows his scrappy company will need to stay nimble.
“I do think this market will get more competitive,” he said.