How do OTT platforms make money:OTT Revenue Models in 2022
OTT streaming offers a pathway to a new home environment with clear benefits. Seeing eyeballs shift to the digital entertainment horizon, OTT delivers media directly to the end user by simply transmitting IP packets to an ISP and using a technology called a content delivery network CDN. From smartphones to smart TV screens, content can be viewed smoothly at your convenience, without buffering or ads.
What are the benefits of the OTT platform?
Attractive content at an affordable price
Content on OTT platforms is considered more creative, original, innovative and accessible than traditional media. Not only that, but consumers do not have to pay to receive subscriptions.
The uniqueness of OTT media
In order to keep up with the growing consumer base on OTT platforms, production companies and film studios have been generating content specifically for these platforms. As with any other top video streaming platform such as Disney+ and HBO Go, you can also stream content and earn content that was previously only available on TV.
View on multiple devices
OTT platform content can be seen on the go, as opposed to non-OTT channels such as cable TV. While OTT video or audio can be watched on your TV, you can also watch it on PCs, laptops and mobile devices if your wearable device has Internet access. In fact, some gaming consoles also support OTT.
Transparent and accurate data
OTT is a way for content creators and streaming platform owners to get more accurate data about who is watching what material, their age group, hobbies, and more. This allows them to tailor their viewing material to different target audiences. Earlier, it was not possible to access such additional features.
How do OTT platforms make money?
Subscription Video on Demand (SVOD)
SVOD is a video-on-demand service that allows subscribers to access a library of video content for a recurring fee. Fees may be charged based on the company’s pricing model (daily, weekly, monthly or yearly). Once subscribers have paid for access to the service, they can watch as many videos as they want based on their subscription. SVOD may be the best option for profiting from content if consumers are willing to pay for it.
Ad Video On Demand (AVOD)
AVOD refers to Ad Video On Demand. This model allows subscribers or users to view content for free. These platforms profit from an advertising revenue model where they charge brands and companies for posting ads on their platform. This model is used by Voot & MX Player.
Transactional Video-on-Demand (TVOD)
TVOD services allow users to purchase content on a pay-per-view (PPV) basis. Users are charged per video or video package, rather than for all access to the entire library. This is the most popular video monetization model among many publishers, especially those that stream live sporting events, and they can leverage PPV as their primary source of revenue. With TVOD, organizations can better control what content their customers consume and how long they consume it.
Just like in the TV era, OTT sponsorship deals involve brands paying for the right to advertise on specific content. There are many ways to deliver your sponsorship message. For example, you can weave it into your content, display it as a banner ad, or show it on the launch screen. One advantage of sponsorship deals is that they can simplify your ad rotation, since you only have to serve a few sponsored brands. However, if anyone chooses to terminate their sponsorship, it will prove costly.
That’s why OTT platforms can earn revenue based on the methods described above. The myriad of options gives both the platform and the viewer the opportunity to choose the best model for them, which is fair. Just as importantly, there is the option of Xmediatv allowing you to try out your own OTT platform for 14 days for free!