FuboTV Interactive Tests Point Toward Commercial Plays, Says CEO

Fubo's purchase of India-based Edisn.ai last fall (see 2111100003) will enable some of that interactivity, said Gandler, saying the purchase wasn't about international expansion plans, contrary to reports. “It is a machine-learning platform that has developed patent-pending video recognition technology that allows us to do lots of things,” he said. He referenced edisn.ai's machine learning platform with video recognition technology that it’s using to build interactive features. Fubo brought 23 machine learning engineers from the company, he said.

One attribute of edisn.ai is that it's "able to read the clock,” Gandler said. The technology can match the clock and data timestamp so a question is relevant to what’s showing on screen, he said. He gave a scenario of soccer player Cristiano Renaldo on screen: “We can pop up, ‘Hey, buy a Manchester United jersey,’” he said.

FuboTV expects to extend interactive advertising capabilities beyond its bread-and-butter sports content. A media buyer for furniture store Ethan Allen could be alerted when the client’s table will appear on a home show, Gandler said: “For $2 more you can run your spot immediately in this break because the table’s here,” he said. Advertisers can “craft your creative based on what’s on screen,” he said. FuboTV will be “experimenting a lot” with the technology, he said. Down the road, “it could have some commerce elements but always tied back to the advertiser.”

On how fuboTV differentiates itself among virtual MVPDs to advertisers, Gandler cited its “hard-to-reach,” male-leaning audience with an average age of 41. The majority of viewers in that provider segment “skews younger,” he said, which makes the fuboTV audience “very expensive.” Some 94% of fuboTV viewing is done on big-screen connected TVs, and 90% is viewed live or in start-over mode within 15 minutes of an event’s start, he said.

Gandler said fuboTV’s $65-$70 monthly fee is an advantage for advertisers, saying it shows its customers “have discretionary income” and “they’re willing to spend money.” Customers of free, ad-supported streaming (FAST) TV services may be “looking to cut costs,” he said. “If you’re a big brand, you probably want to target people who are willing to spend money vs. folks that are on Pluto and Tubi and others that seem to be more attuned to cost-cutting.” FAST customers, he posited, have a higher tendency to buy generic products vs. premium brands.

On what fuboTV has planned for the May IAB NewFronts digital content marketplace, Gandler said the company will continue initiatives it began last year on the consumer side including 4K streams. It will demonstrate to business partners that its users are a “group that’s able to stay on top of the latest technology” and can test new concepts. He cited soccer programming deals with the Union of European Football Associations and England’s Premier League in Canada.

Gandler also cited a fuboTV podcast initiative as part of the company’s “omnichannel approach.” He highlighted Gilbert Arenas’ podcast, saying it’s one of the top 10 podcasts on Spotify. The omnichannel approach gives advertisers “an opportunity to not only leverage our advertising capabilities on CTV but also add some level of discrete capabilities” to drive higher engaging campaigns, he said.

Fubo doesn’t have an ad inventory share on broadcast networks, which typically have an inventory share with their local affiliates, Gandler said. It has about a 20% slice of ad inventory shared by cable networks, or about 2 minutes per hour, he said. He called it a very-margin business at 95-100% that allows the virtual MVPD to expand its average revenue per user “with no incremental costs.” Ad revenue “becomes key as content costs continue to rise,” he said.

On whether Turner’ Sports' reported eight-year U.S. Soccer rights deal changes the vMVPD’s view on its January decision to drop Turner Networks, Gandler said, “We’ve proven there’s no one sports tent pole or any piece of content that will lead to the success or demise of the platform.” FuboTV has continued to grow without having “a complete bundle” like competitors have, he said, noting its 185,000 net adds in Q4. The company will continue to “optimize” its bundle “because we do have to manage costs.” It has renegotiated deals with some partners and others have gone off the platform, he said.

Gandler repeated fuboTV’s stance that its focus with sports betting is on the casual bettor and it’s not competing with DraftKings or FanDuel because “the barriers to entry are quite high,” he said: “I’m not sure that a virtual MVPD wants to get in the betting business.” It wants to be able to offer betting during high-profile events, he said. At the same time, Gandler noted betting companies are in a “fierce battle” to acquire customers but don’t have access to top sports content. FuboTV sees additional betting revenue creating “user economics that are significantly better than just video.” It’s “bullish” on ARPU of $15-$20: “If you can get to $10 or $15 per month on your customer base for wagering, then all of a sudden, with 50% margin, things are starting to look pretty strong.”

On whether fuboTV is looking to integrate fantasy betting or Twitch-like functionality into the platform, Gandler said the company has developed its business on testing and experimentation. If it sees “traction toward the fantasy space, which I think we will see, we’ll begin to think about how to embed or integrate that into the experience.”