With the global Video On Demand (VOD) market expected to reach $87.1 billion by 2026, the digital broadcasting realm is bustling with opportunity for content creators and distributors alike. Amidst this burgeoning landscape, VOD platforms stand as a promising conduit to a global audience. However, the young and dynamic nature of this industry necessitates a degree of agility from VOD platforms, particularly in their monetisation strategies.

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Unveiling the Importance of Monetisation Flexibility

The Evolution of Monetisation Models in VOD

The VOD landscape has witnessed the evolution of various monetisation models: Subscription Video On Demand (SVOD), Advertising-based Video On Demand (AVOD), Transactional Video On Demand (TVOD), Premium Video On Demand (PVOD), and Freemium models​​. Each model represents a unique approach to engaging and monetising users on the platform, with SVOD, AVOD, and TVOD being the traditional models, while PVOD and Freemium offer more nuanced strategies.

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Exploring the Spectrum of Monetisation Models

The richness of monetisation strategies in the VOD industry underpins the diverse approaches platforms can adopt to generate revenue while catering to varied consumer preferences. Here’s a breakdown of the primary monetisation models:

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Subscription Video On Demand (SVOD)

In SVOD, users pay a regular subscription fee to access a library of content. It’s the model adopted by platforms like Netflix and Hulu, providing an ad-free viewing experience to subscribers.

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Advertising-based Video On Demand (AVOD)

AVOD relies on advertising revenue. Platforms like YouTube and Tubi offer free content to viewers, monetizing through ads displayed during video playback.

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Transactional Video On Demand (TVOD)

TVOD, like Apple TV or Google Play, allows users to pay for individual pieces of content, be it a movie or a TV episode, on a per-transaction basis.

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Premium Video On Demand (PVOD)

PVOD, adopted by platforms like Disney+ for select releases, is an extension of TVOD where viewers pay a premium price for early access to new releases, often before or during theatrical releases.

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Freemium Model

The Freemium model, as seen on platforms like Spotify, is a hybrid of AVOD and SVOD. Platforms offer basic content for free with ads, while premium content or an ad-free experience is available for a subscription fee.

Each of these models presents unique advantages and caters to different consumer preferences and market dynamics. The ability to navigate between these models or adopt a hybrid approach can be a significant asset in the ever-evolving VOD landscape.

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Pivotal Shifts and Success Stories

While the industry continues to evolve, there's no one-size-fits-all monetisation strategy that guarantees success. The ability to pivot and adapt to new monetisation models can play a significant role in a platform's sustainability and growth. For instance, Netflix, a dominant player in the VOD industry, has recently showcased the importance of monetisation flexibility.

Faced with a decline in SVOD penetration and rising cancellations attributed to cost, Netflix has begun to explore a mixed AVOD model alongside its traditional SVOD model. This strategic pivot aims to provide a cost-effective alternative for viewers, while also rolling out a highly profitable AVOD business.

Projections indicate that Netflix is set to offer a hybrid AVOD-SVOD tier across 85 countries by 2028, reflecting a broader industry trend toward hybrid monetisation models​​. Other platforms have also transitioned from pure SVOD to AVOD supported to diversify their revenue streams and cater to a broader audience.

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Shift72: A Beacon of Monetisation Flexibility

Shift72 stands as clear leaders of the pack when it comes to monetisation flexibility in the VOD industry. Offering a platform that exudes complete control and flexibility for video content owners, Shift72 caters to both small organisations and large enterprises​​. Its unparalleled flexibility ensures that your secure video strategy is never hampered by technical limitations, making it a future-ready platform for today's challenges​.

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Multiple Monetisation Solutions

Shift72’s platform is designed to be adaptable to your business model. Whether exploring AVOD on apps, launching a powerful direct-to-customer VOD and live streaming experience, or navigating the nuances of PVOD and Freemium models, the platform’s robustness offers a myriad of flexible monetisation opportunities​​.

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Navigating the Future of VOD Monetisation

With Shift72, you’re not just navigating the current landscape of VOD monetisation but are well-prepared to adapt to future shifts in the industry. As the VOD industry continues to unravel, having a flexible and robust platform like Shift72 can be your cornerstone for sustainable success.

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Conclusion

As the VOD industry continues its journey towards maturation, the importance of monetisation flexibility cannot be overstated. Platforms like Shift72, with its focus on providing a flexible and comprehensive monetisation toolkit, are setting a precedent for how VOD platforms can thrive in this dynamic digital broadcasting realm. Discover how Shift72 can revolutionise your VOD monetisation strategy by booking a demo of our platform today.

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