What is SVOD, AVOD, and FAST?
Over-the-top (OTT) video streaming has become increasingly popular among consumers, providing a convenient and affordable way to access a wide variety of video content. These services include streaming platforms like Netflix, Hulu, and Amazon Prime Video. While OTT streaming services are highly popular, how they make revenue is not always clear. In this article, we'll take a look at how OTT video streaming services make money, the differences between subscription-based, advertising-based, and free ad-supported services, and how real-time data and low latency can offer benefits to these services.
OTT video streaming generates revenue through various means, including subscription fees, advertising, and transactional revenue.
Subscription Video On Demand (SVOD)
This type of service is a subscription-based model where viewers pay a monthly or yearly fee to access the platform's content library. Examples of SVOD services include Netflix, Amazon Prime Video, Disney+, and HBO Max. These services offer a commercial-free viewing experience, and subscription fees are the primary source of revenue.
Advertising-Based Video on Demand (AVOD)
This type of service generates revenue through advertising, rather than subscription fees. These services allow viewers to watch content for free but display advertisements to generate revenue. Examples of AVOD services include Hulu and Peacock. These services offer a mix of original and licensed content and are typically less expensive than SVOD services. Netflix and Disney+ have also introduced subscription plans with ads.
Free Ad-Supported TV (FAST)
This type of service offers free content supported by advertising. FAST services typically offer live TV channels or curated channels, rather than on-demand content. Examples of FAST services include Pluto TV and Tubi. These services are entirely free for viewers and generate revenue through advertising.
Difference between OTT video services
OTT video services differ in terms of content, pricing, and business model. Some services offer original content, while others license content from other studios. Some services offer only TV shows, while others focus on movies or a mix of both. Pricing can also vary significantly, with some services being more expensive than others.
Importance of real-time analytics and low latency
Real-time data and low latency play crucial roles in enhancing the performance and success of OTT video services.
Real-time analytics
Real-time analytics enables platforms to track consumer behavior and gain valuable insights into popular content and viewer engagement patterns. By leveraging this data, platforms can make informed decisions regarding content acquisition, advertising strategies, and pricing adjustments. Real-time analytics empowers OTT streaming to cater to their audience's preferences and interests, ultimately improving the user experience and increasing viewer satisfaction.
Low latency
Low latency is essential for OTT video streaming as it ensures a seamless and uninterrupted viewing experience. High latency can lead to video lags and buffering, frustrating viewers and potentially driving them away. By minimizing latency, platforms can deliver video content smoothly and maintain a high-quality viewing experience. Low latency is particularly crucial for real-time ad matching and ad cohorts, ensuring that advertisements are seamlessly integrated and relevant to the viewers in real-time.
Conclusion
OTT video streaming has revolutionized the way consumers access and enjoy video content. With revenue models ranging from subscription-based and advertising-based to free ad-supported services, OTT platforms have provided diverse options to cater to different viewer preferences. Real-time data and low latency are pivotal for optimizing the viewer experience, as they enable platforms to understand their audience better and ensure seamless content delivery. By leveraging real-time analytics and reducing latency, OTT video streaming can thrive in a highly competitive landscape, meeting viewer expectations and staying ahead of evolving consumer trends. Learn about Macrometa's Dynamic Ad Cohort solution and other OTT Video Streaming Services offerings, or chat with one of our solution architects.