On with Kara Swisher: Why Tubi CEO Anjali Sud Says Free Is the Future of Streaming

Hosted by Kara Swisher of Vox Media, this episode features an in-depth conversation with Anjali Sud, the CEO of Tubi, a leading free, ad-supported streaming platform. Released on December 7, 2024, the episode delves into Tubi's unique approach to streaming, its commitment to diversity, innovative use of AI, and Anjali's remarkable career trajectory.

1. Tackling Boardroom Diversity: "Too Many Dicks in the Boardroom"

Anjali opens the dialogue by sharing her provocative article titled "Too Many Dicks in the Boardroom," which critiques the lack of diversity in corporate leadership. She recounts her experience writing about Twitter's board, highlighting the homogeneity and its detrimental impact on the company's performance.

Anjali Sud [04:16]: "I wrote a lead that I think was the best thing. I should have retired immediately after writing it, but the lead was here on the board of Twitter with three Peters and a dick."

When confronted by Twitter's CEO, Dick Costolo, Anjali defended her stance, emphasizing the necessity of diverse perspectives for a company's success.

Anjali Sud [04:27]: "Why is it that you have 10 men of the same type and the same names in the boardroom? I don't understand why your company is sucking so bad."

This conversation underscores the importance of diversity in leadership and its correlation with organizational health.

2. Introducing Tubi: A Free Streaming Paradigm

Kara introduces Anjali as a trailblazer in the streaming industry, noting her previous leadership role at Vimeo.

Kara Swisher [01:04]: "It's completely unlike the typical streamers that come to mind and trust me, you're going to wish you knew about it sooner."

Anjali elaborates on Tubi's mission to provide free, ad-supported streaming, positioning it as a counterbalance to subscription-heavy platforms.

Anjali Sud [06:58]: "Tubi is the most watched free movie and TV service in America. We have over 80 million monthly active viewers, and it's a totally free service for consumers."

She highlights Tubi's extensive library of over 250,000 TV episodes and movies, emphasizing the platform's focus on unique and diverse storytelling.

3. Navigating the Streaming Landscape: Paradox of Choice and Subscription Fatigue

Anjali discusses the current challenges in the streaming market, such as the "paradox of choice" and increasing subscription costs.

Anjali Sud [08:57]: "There’s subscription fatigue. You've got subscriptions, too many subscriptions, tiers, prices are increasing, content's feeling less differentiated."

Tubi addresses these issues by offering a streamlined, free alternative that eliminates the burden of multiple subscriptions.

Anjali Sud [07:04]: "What we have heard is, there's a paradox of choice. We've got subscriptions, too many subscriptions, tiers, prices are increasing, and content's feeling less differentiated."

4. Content Strategy: Embracing Nostalgia and Unique Categories

Tubi leverages a vast collection of nostalgic and obscure titles, creating specialized categories that cater to diverse interests.

Anjali Sud [10:02]: "When people say Tubi's got this weird vibe and it feels different, I think that's awesome. Because in a market like this, you need to be different."

Anjali introduces inventive content categories such as "Magical Christmas Love" and "Demonic Possessions and Exorcisms," which attract niche but loyal audiences.

Anjali Sud [13:48]: "Some of the stuff you're gonna see us do is gonna be like, no one else would do that."

These categories not only differentiate Tubi from competitors but also foster a sense of community among viewers with specific interests.

5. Reaching Cord Cutters and Cord Nevers: Diversifying the Audience

Tubi strategically targets "cord cutters" and "cord nevers," expanding its reach beyond traditional cable subscribers.

Anjali Sud [15:55]: "About 65% of Tubi's audience are cord cutters or cord nevers, meaning they never even kind of thought about having a cable subscription in the first place."

She emphasizes that Tubi's audience represents a broad demographic, including younger, multicultural, and female-forward viewers, making it an attractive platform for advertisers seeking incremental audiences.

Anjali Sud [17:04]: "If you're a brand and you're trying to reach America with your story, if you only advertise on cable and Netflix, you are missing a real swath of the country who just aren't going to do either of those."

6. Leveraging AI for Enhanced Content Discovery

Anjali discusses Tubi's collaboration with OpenAI to enhance the user experience through AI-driven content discovery, focusing on improving how viewers find content based on mood and preferences.

Anjali Sud [21:06]: "What we have tested is like today, you search by the name of a title or by genre or content. What if you searched by mood?"

She clarifies that while AI aids in discovery, Tubi does not currently utilize generative AI for content creation.

Anjali Sud [22:52]: "I'm optimistic that if used responsibly and well, Gen AI can accelerate creativity."

7. Original Content: Efficient and Audience-Driven

Tubi's approach to original content differs from subscription services. Instead of high-budget productions aimed at customer acquisition, Tubi focuses on "efficient originals" that drive engagement and align with its ad-supported model.

Anjali Sud [26:06]: "Our originals, yes, we've created 300 originals. I can tell you that the total cost of that is far less than a premium sort of subscription service."

One notable example is "The Thicket," a theatrical release starring Juliette Lewis and Peter Dinklage, which showcases Tubi's willingness to experiment with different distribution methods.

Anjali Sud [27:35]: "It's got stars. And finally, Tubi's best performing in terms of viewers content on Tubi ever."

8. Building a Diverse and High-Performing Team

Anjali underscores the importance of diversity not by mandate but by valuing talent and varied perspectives. This philosophy has resulted in a balanced executive team at Tubi.

Anjali Sud [44:22]: "It is my job to build the absolute best team to win in this industry. Talent comes in different forms."

She highlights the significance of aligning team diversity with business outcomes, ensuring that diversity translates into tangible impact.

9. Business Model: Free and Ad-Supported vs. Subscription Tiers

Tubi embraces a pure ad-supported model, contrasting with competitors like Netflix and Disney that offer ad-supported tiers alongside premium subscriptions. Anjali explains that Tubi's alignment with its business model—being solely free and ad-supported—enhances its value proposition.

Anjali Sud [35:54]: "The difference and, and I think it matters, and I've seen it is there's one way to get to profitability is oh shoot, we have an earnings, you know, there's stock pressure, cut a bunch of costs and get to profitability. The other way is grow sustainably, steadily, and every single week, month, quarter, get more efficient so that your revenue is growing faster than your costs."

She critiques Amazon's FreeVee for not being set up for success, emphasizing Tubi's focused mission to become the number one free streamer.

10. Strategic Partnership with Fox Corporation

Tubi, owned by Fox Corporation, benefits from strategic partnerships that enhance its market presence. Anjali discusses Tubi's involvement in major events like the Super Bowl, where it leverages Fox's resources to create engaging content around sports culture rather than broadcasting the games themselves.

Anjali Sud [46:42]: "We're just going to create some of that conversation. And another example, we launched a talk show this month with Deion Sanders, Coach Prime."

This strategy aligns with Gen Z's preference for content around the stories and culture of sports rather than live events.

11. Future Growth and Device Distribution

Tubi is accessible on 30 different devices, including emerging platforms like Apple Vision Pro. Anjali forecasts significant growth in mobile consumption, recognizing it as a critical area despite current lower advertising CPMs.

Anjali Sud [50:42]: "I just think you're going to see in general as consumers, like we are going to be very fluid in the surfaces that we consume content."

She emphasizes the importance of ubiquity, ensuring that Tubi remains accessible across various devices to meet evolving consumer behaviors.

12. Commitment to Brand Safety and Content Moderation

Ensuring brand safety is paramount for Tubi, as it maintains a curated library instead of a user-generated content (UGC) platform. Anjali explains that all content is vetted to align with advertiser expectations and societal standards.

Anjali Sud [52:15]: "Everything we do is brand safe. Our incentives are very aligned and it's just frankly not an issue that has come up."

This approach differentiates Tubi from platforms like YouTube, where content moderation can be more challenging.

13. Leadership Journey: From Marketing to CEO

Anjali shares her unique path to becoming CEO of Vimeo before transitioning to Tubi. She attributes her rise to a combination of seizing opportunities, championing strategic pivots, and fostering a culture that values diverse talent.

Anjali Sud [40:09]: "I joined Vimeo as a director of marketing team of five... I sort of just almost by accident became the internal champion for a very different strategy."

Her leadership style focuses on empowering talent and impact over equity, ensuring that team diversity stems from a genuine commitment to excellence and varied perspectives.

14. Sustainable Growth and Profitability

Anjali outlines Tubi's strategy for sustainable growth, emphasizing that profitability is achieved through consistent revenue growth outpacing costs rather than through abrupt cost-cutting measures.

Anjali Sud [38:27]: "The key to sustainability is ultimately profitability."

She highlights that Fox Corporation's support allows Tubi to think long-term and remain committed to its principles, providing the necessary runway to achieve financial goals.

15. Closing Thoughts: The Future of Free Streaming

As the conversation wraps up, Anjali reaffirms Tubi's mission to revolutionize the streaming landscape by focusing on free, ad-supported content that prioritizes viewer engagement and diverse storytelling.

Anjali Sud [49:07]: "We're really only successful when the viewer is engaged."

Kara concludes by emphasizing Tubi's potential to reshape how audiences consume media, positioning it as a formidable player in the future of streaming.

Notable Quotes:

• Anjali Sud [04:27]: "Why is it that you have 10 men of the same type and the same names in the boardroom? I don't understand why your company is sucking so bad."
• Anjali Sud [06:58]: "Tubi is the most watched free movie and TV service in America."
• Anjali Sud [21:06]: "What we have tested is like today, you search by the name of a title or by genre or content. What if you searched by mood?"
• Anjali Sud [35:54]: "The difference is, if you make it about business outcomes and you make it about impact, everyone can get on board."

This episode provides valuable insights into how Anjali Sud is steering Tubi toward becoming a key player in the streaming industry by prioritizing free access, diverse content, and innovative user experiences.