Increase Business Revenue With These OTT Monetization Models
Posted By : Priyansha Singh | 02-Sep-2022
OTT Monetization Models
The Over-The-Top (OTT) market has proliferated exponentially in the past few years. Today, platforms such as Amazon Prime, Netflix, Hulu, and HBO Max are considered mainstream because of their strategic and successful OTT business models, drawing millions of users to stream and watch their digital media content every single day. While content diversity and quality on offer will always be the ultimate decider, having predefined and convenient OTT models for different target audiences will inevitably be a plus point.
Moreover, with the inception of new streaming service providers around the globe, the OTT market space has become fiercely competitive – with everyone grappling and striving for new subscribers and their wallet share. Content producers are finding intuitive ways to inculcate advertisements or monetize their multimedia content to garner business revenue. Typically, OTT monetization revolves around Video-on-Demand (VOD) streaming models.
Also, as a business owner, architecting your own OTT platform in accordance with specific OTT monetization models will tremendously help in:
- Reaching more user base
- Providing a better streaming service
- Earning more revenue
In this guide, we have shed some light on OTT revenue models and why you should opt for a specific OTT monetization model while developing your OTT platform. So, let’s get started.
What Are OTT Revenue Models?
There is no doubt that in 2022, there are now more than thousands of OTT broadcasters that are serving unique content or aggregation of most liked content to their viewers. All the successful brands and video streaming service providers are leveraging multi-experience OTT platforms with the right monetization model to incur revenue.
However, if we were to further categorize these OTT revenue models, the number of ways that thousands of OTT brands generate revenue ultimately boils down to a single digit.
In essence, there are 4 OTT monetization models that have marked their concrete presence among professional media broadcasters. These are:
- Monetizing With Advertisements
Also reckoned as AVOD or the Ad-based Video on Demand model generates revenue with advertisements. The content search platform or the content aggregator offers the content to viewers for free, however, there is a catch as the content is served with a concoction of ads to the users.
The broadcasters preeminently make money by charging a certain amount as a fee to advertisers for a space in their content platform to play commercials. The ads are usually played as sponsored content, video ads, sponsor screens, and more.
Some of the examples of AVOD business models include Xumo, Pluto TV, Tubi, YouTube (non-premium), Hulu, Facebook, and Instagram.
- Subscription Based VOD
SVOD or Subscription-based Video on Demand businesses charge a pre-defined recurring fee on a weekly, monthly, quarterly, half-yearly, or annual basis for providing users with full access to their platform. The SVOD monetization model was primarily made popular across the world by Netflix and it still continues to dominate the OTT landscape and related video streaming businesses today.
Some of the prominent examples of SVOD businesses include YouTube Premium, Apple TV+, Netflix, HBO, Voot, and more.
- Transactional-based Content
Transactional Video on Demand or TVOD is one of the most straightforward and plain-sailing OTT revenue models of all. It operates on a one-time give-and-take basis such as purchasing and renting any item from a nearby shop.
With TVOD, viewers can buy or rent videos one at a time in accordance with their needs. This OTT model is usually also known as pay per download (PPD) or pay per view (PPV).
Some noteworthy examples of TVOD businesses include CinemaNow, UFC, iTunes, Sky Box Office, and more.
- Hybrid (AVOD+SVOD+TVOD)
With no holds barred, a hybrid business model is not a particularly constructed or a single established business model. Many OTT platforms and businesses are putting their spin on already established OTT monetization models and coming up with neoteric hybrid models that work in accordance with their needs.
Some video streaming businesses such as Disney+ are efficaciously blending TVOD with SVOD as they are providing users with access to new movies & shows on a transactional basis apart from the subscription. Another great example is Discovery+ which segmented its viewers on two levels to mix SVOD with AVOD. The lower fee subscribing users are served with digital media content with some ads, while higher fee subscribers get access to the same content but with zero ads.
How OTT Service Providers Are Implementing Hybrid VOD Monetization Models?
The predominant and the most essential step toward implementing a hybrid monetization model is to identify the type of VOD revenue model that you intend to use and combine. The next step is to single out your primary VOD monetization model and strategize how will introduce and blend the remaining models into your OTT business.
Then, the final step of course is to architect a multi-platform, multi-device OTT streaming solution that engages and captures the attention of your audience.
Moreover, in hybrid models, you can make some portion of your content library free-to-view with some inserted ads and simultaneously lock the rest of the library for paying subscribers.
Looking For VOD or OTT Platform Development Solutions For Your Project?
At Oodles Technologies, we furnish end-to-end video streaming solutions such as building VOD apps, OTT platforms, cast-ready applications, multi-level video conferencing, video chat/messaging apps, live video streaming app development, and more. As an established video streaming platform development company, we enable businesses to harness the power of digital media through our robust online streaming app development and consulting services. We have an in-house team of seasoned professionals that assist in offering the most reliable and robust OTT and VOD services to users all over the world. Over the years, we have attained utmost proficiency and excellence in live and on-demand streaming services and strive to deliver lucrative and robust solutions using next-gen technologies. If you are looking for OTT platform development for your business, feel free to drop us a line. Our experts will get back to you within 24 hours.