OTT is a big business market. It definitely has a huge potential, and it has shown and is showing that potential now. But many of you must be asking how to generate revenue from it and how streaming platforms can make money. There are different ways to monetize your content. the most common ways OTT platforms use to monetize are AVOD (Ad Video On Demand), TVOD (Transactional Video On Demand) and SVOD (Subscription Video On Demand). People may be confused about how these platforms are monetized, but we’re here to make it easier to understand.
How does AVOD work?
AVOD is very well suited for free-to-air TV channels and can provide a good revenue stream. Some content is better suited for AVOD, such as longer content and older movies, because there is enough time to show enough ads as part of the package to justify the cost. If AVOD is used for shorter content, such as 3-4 minute videos, there will only be time to display one or two ads.
Operators need to understand their target audience in order for AVOD to work well as a revenue source, particularly whether cell phones or TVs are likely to be the primary device for viewing content. Other considerations include viewing habits, disposable income and device setup before deciding which VOD system is appropriate. Younger viewers are more likely to watch long-form content on their phones, so AVOD is particularly suitable for them. However, they often don’t have much disposable income. On the other hand, older viewers prefer to watch short-form content on their mobile devices, but watch long-form content on their smart TVs or through IPTV/OTT services, which is more suited to the SVOD model.
How does TV-on-demand work?
TV on Demand is a transactional model where viewers pay for each viewing. This model is typically used for premium content, such as new release movies. avod is an ad-supported model where viewers can watch videos for free, but ads are shown before and during the video.
For example, Netflix charges a monthly subscription fee and does not show ads. Hulu Plus also charges a monthly fee but shows some ads. Amazon Prime Video is free for Amazon Prime members, but has ads. HBO Now is also ad-free, but charges a monthly fee. These examples show that charging a subscription fee is the best way to make money through OTT services.
How does SVOD work?
SVOD or subscription video on demand follows a basic subscription model where you have to pay the required fees on a monthly or annual basis to get access to all the content on the platform. It is a platform for those creators who have a bundle of content to publish. It is a model that has gained a huge share on OTT platforms.
The main player in this platform is Xmediacloud. it has different subscription amounts for different devices, including cell phones, laptops, computers, tablets, etc.
Video on demand may not be a new concept, but the ubiquity that modern Internet technology has given it is certainly revolutionary. The ability to consume video content at your convenience has changed the content landscape forever.
It’s no wonder, therefore, that companies are scrambling to take advantage of it. However, video on demand is still evolving, and there’s no telling where its growth will lead. With more and more personalized and tailored content, the competition for VOD supremacy is heating up.
One thing is certain: both viewers and VOD providers have a lot to gain from the technology. Don’t wait for this trend to peak; enter the VOD space early and reap the first-mover advantage. Contact us today.