We often talk about how technology has played a significant role in bringing together the world by shrinking the distance between geographies. Video powered technology is one of the most important contributors owing to this change. From cord-cutting to streaming on demand videos, there is a rapid growth in the video streaming business. In this digital environment, the streaming TV wars are upon us. Even with new streaming services launching every year, Netflix still remains the king of streaming TV. Unlike ever before viewers of today have choices of accessing entertainment anytime, anywhere, and on any devices.
The proportion of UK homes with at least one subscription service has increased to 52% in the first quarter of 2020. Over 15.01 million users have access to at least one of on demand streaming services like Netflix or Amazon Prime. Year-over year, this growth is rapidly rising among households across the globe.
As we have been forced to stay indoors during the COVID-19 pandemic, video streaming services like Netflix are a boon to enjoy entertainment. Social media are buzzing with discussions that point to the same.
Here’s the delighting news for all entrepreneurs out there.
You can use this astounding popularity of video streaming to establish and grow your business. If you are thinking about how to start a business like Netflix, but you are stuck on where to start, do not worry, this blog will exactly take you through all of it right from the very basics. First, you need to understand a little bit about Netflix and how it works. Let’s start with its business model.
The movie streaming giant was founded in August 1997 by two entrepreneurs. Marc Randolph and Reed Hastings. They started out as a web-based movie rental service and later became the world’s best entertainment platform.
During its initial times, Netflix allowed people to rent DVDs online and send them through email to its customers. While it was competing more with established video rental stores, it was also competing to some extent with TV for the viewer’s entertainment time.
When the whole world was glued to their TV screens, Netflix revolutionized the entertainment space with the idea of renting DVDs online so that viewers could watch their favorite shows and movies anytime they want at the comfort of their home. The streaming giant could adapt to changing technologies and audience demand, which made it very successful.
Netflix over the years:
According to Statista, Netflix had over 148 million subscribers spread across the world. Now, in the middle of 2020, Netflix has over 167 million paid users in over 190 countries. It has over 57 million users from the US. alone. On average, Netflix users spend over 1 billion hours watching movies and shows every week. It offers a broad range of movies, TV shows, documentaries across a broad category of language and genres.
Looking back to the history of the streaming giant, it can be a valuable learning lesson for the streaming business how Netflix raised to the top and set its throne. When creating your own streaming service, as long as you can keep up with the trend of innovation like Netflix, your business will remain dominated in the streaming industry,
Have you ever wondered how Netflix manages to make a lucrative revenue every year? The secret lies in its business model. Netflix has worked its way into the lives of people around the world and revolutionized the way we watch TV shows and movies with its subscription business model. It is one of the simplest and effective business models that allows Netflix to create a consistent, scalable revenue flow. Netflix offers three simple subscription plans basic, standard, and premium starting from $8.99 to $15.99 as shown below.
However, if you are seriously thinking about how to create a video streaming website like Netflix, the first thing you need to understand is not to expect overnight success. The same was true with Netflix as well- It didn’t have an overnight success. Netflix also has negative cash flows as it invests greatly in original content and content license agreements.
Here is how the subscription business model works-
Viewership register on the platform.
Leverage a 14-day trial.
Upon completion of the trial period, choose the desired package.
Pay the monthly fee.
Netflix offers different subscription plans based on two aspects.
Simultaneous login counts
Based on these aspects, users can subscribe to any of the three plans like below.
Basic- For standard video quality streaming and single login
Standard- For HD video quality streaming and two different logins at a time.
Premium- For 4K video streaming and 4 logins simultaneously
An in-depth look reveals that the business plan of Netflix aims at making revenue without charging a hefty price for the users. Take the premium subscription plan for example. Though it is the costliest plan it is actually the cheapest one considering the benefits users can avail. As it allows four different logins at a time from different devices at a time, four people can share the subscription cost and get the premium plan at an affordable price.
When brainstorming about how to start your own streaming service, selecting a business is not enough. You have to consider the preferences of your target audience and how you can generate maximum revenue without being evident in doing so.
Here is a Depiction of How Netflix Works:
The business model is not just about how you monetize. A business model mainly embraces a monetization strategy but it is more than that. It is about how you make your product or service available to your audience, and you make revenue from it. It is about the value you create for businesses and users.
One of the unique selling points of Netflix is the original content it creates. As it grew bigger, Netflix started producing its originals so as not to be left being in the competitive video streaming space. Likewise, when you want to start a streaming service, aim for a long term growth strategy to deliver your own shows to keep your subscribers hooked to your platform.
How to Start Your Own Streaming Service?
Creating the next Netflix is no easy task, but creating a movie streaming website is a lucrative and attractive business proportion. Here is a comprehensive guide to start your own streaming service.
Find Your Niche:
The first step is to choose the niche to power your video streaming service. While Netflix hosts shows and movies from all categories, you can choose to stick to a specific niche around which you plan to create videos for your audience. Here are some of the niches you can consider.
Religious Streaming Service:
In this digital era, to connect with believers across the world, most churches and mosques have started their on demand streaming and live streaming platform. Likewise, you can also invest in creating a Netflix-style religious streaming platform if you are looking forward to creating a website like Netflix in a different niche.
For example, Fatiha TV is an exclusive Netflix style Islamic streaming platform that offers Islamic videos for the believers including prayers and Quran studies.
If you are working on how to make a website like Netflix in a different niche, gaming makes a great niche idea. You can start a Netflix for video games, it can be on a subscription basis or based on a rental model as Netflix did when it started.
For example, GameFly is a subscription-based video game and movie streaming service with a 30 day free trial.
With the spotlight on fitness and health, fitness streaming makes another niche idea to build a website like Netflix. You can start a fitness subscription service to bring you live studio workouts to your clients or can start a platform that connects several studios worldwide to stream fitness classes.
For example, Booya fitness is a similar subscription-based fitness platform that streams dozens of workouts on demand from 30 different studios. From Strength training to Boot camp, HIIT to yoga, and Pilates, they have different types of online classes.
Starting a Netflix styled sports streaming platform is another great idea to enter into the streaming industry. Recently the Premier league revealed its plans to create a Netflix-styled sports streaming service to revolutionize how English football is consumed. Many leading brands are planning to enter into the sports industry and social media is already talking about this.
If you are planning on how to create a streaming service, sport is a great niche to start with. Or if you already have a streaming platform, sport is a great niche, to begin with. If you can start a sports streaming channel as an additional venture to leverage the opportunities offered by the sports industry.
For example, the Foxtel Australian pay-TV company has launched its sports video streaming subscription services that offer live and on demand sports programs from ESPN, Racng.com, Fox Sports, beIN sports, etc.
When you know about the niche you are going to target, it is easy to plan your content. Plan what kind of videos you are going to create to engage the target audience in your niche. Get clear on what your audience can expect when they subscribe to your video on demand service.
Here are some of the important things to consider before starting with content building.
The length of the videos- Will your videos be short or long?
Are you planning to roll out your content as a series or a one-one episode?
Will you be curating the content from different content providers or are you planning to create your own shows?
The answers to the above questions are solely based on your requirements and goals. You have complete control over the content you create.
Alternatively, when creating your own streaming service, you can also buy content from authentic global content marketplace for film and TV rights. Content marketplaces are trusted global community buyers. Content search, negotiations, transactions and all the other processes are done online.
These online content marketplaces partner with leading Hollywood trade bodies by adhering to global industry standards for rights management, material delivery etc. Likewise, you can also sell your content on such platforms. For example, Vuulr is a reputed content marketplace for buying films and TV rights.
The next era of differentiation in entertainment is defined and propelled by the increased demand of the audience for the live and shareable experience. Viewers want to get close, more engaged, and better connected with the shows they live in both the physical and digital world. For the licensing industry, this makes a great opportunity to create products for the audience and make a hefty amount from the deal. To start and launch a VOD service with the latest Hollywood movies, old classics, and TV shows is an expensive affair with the cost running into millions of dollars. When estimating how much to start a streaming service, the most significant thing to consider is the licensing cost to acquire the content.
In 2015, the Wall Street Journal reported that out of Amazon, Hulu, and Netflix, Netflix has planned on designating the most funds towards acquiring content as shown below.
Curating content for your video on demand service involves constant collaborations with content providers to acquire and maintain compelling content. If you are planning to create your own streaming serviceon a large scale, it might not be easy to acquire the license as the production houses might have already sold their rights. In that case, look out for small production houses looking for online distributions.
Here is a brief description of how content licensing works.
As far as video streaming goes, content licensing involves 2 main parties- the broadcaster and the content providers. The agreement between streaming platforms and content providers will essentially offer permission to stream TV shows and movies on their platform. The terms and conditions can be changed in each renewal.
To make it clear, there are only 2 ways to acquire a license for streaming service.
You can rent the show or movie directly from an authorised distributor.
Contact the copyright holder directly.
One of the main reasons why Netflix started to create its own content is the fact that licensing costs for new content are so high. When Netflix rolled out House of cards back in 2013, Netflix changed the TV games and amped up its popularity and revenue.
Since then, ‘Binge-watch” and ‘Netflix and chill’ have been a norm in the streaming universe. Netflix has dramatically increased its original production releasing what seems like a dozen new shows and movies every week. Likewise, you can invest in the originals production to save on licensing costs and to gain a competitive advantage in the streaming industry.
Many people talk about business models these days. But what does that really mean? We have already discussed the business model of Netflix. -It is basically how it monetizes its products and services. But is the subscription model the only monetization model for video streaming services? We are going to discuss the same thing here. When it comes to starting a Netflix style business, your business model is the decision about how you plan to make money and intend to add value to your target audience
The monetization strategy is the first thing you need to decide the moment you plan on how to create a movie streaming app, but most businesses make the mistake of postponing it until the end. However, this is not the best approach as monetization methods are the most significant part of launching a video on demand service and it must be chosen way before starting.
Here are some of the common monetization methods adopted by video streaming businesses that you can choose from to reach your business goals.
Subscription Video On Demand (SVOD):
SVOD is the most common monetization method followed by most streaming services.
Netflix, Amazon Prime, and Hulu are some of the prominent examples of VOD services following the SVOD revenue model.
In this monetization model, users need to pay a monthly fee to gain unlimited access to the content library. You can further diversify the subscription model by different plans for the subscription like Netflix does. Subscriptions are mostly auto-renewable and users have the flexibility to cancel the subscriptions anytime.
Advertisement Video On Demand (AVOD):
Advertisement monetization methods allow viewers to watch the content for free, but they have to watch ads at different points through the video. Video platforms and content providers share the revenue earned from advertisements.
YouTube is one of the most prominent video streaming services with a global success story following the advertisement monetization method.
Ads are broadly classified into Pre-roll, Mid-roll, and Post-roll ads.
Pre-roll- Ads that play at the beginning of videos.
Mid-roll- Ads that play in the middle of videos.
Post-roll- ads that play at the end of videos.
The ads can be skippable or non-skippable depending on the ad network and the advertiser.
Pay Per View or Transactional Video On Demand (TVOD):
TVOD is another monetization model where users just pay for the content they watch. This works like a digital version of a DVD store where you can purchase or rent DVDs and pay just for that.
iTunes is one of the popular examples of a TVOD monetization model.
A hybrid monetization model is a combination of SVOD, AVOD, or TVOD in any pattern. Choosing a hybrid monetization model allows you to monetize your content to satisfy the interests of users with different preferences. When you create a website like Netflix, there will be some users who would like to access the content for free, and some who like to gain unlimited access to your content, and there will be people who just want to pay for individual videos they want to watch. A hybrid monetization model allows you to serve a broad target market and monetize your content in several different ways which is beneficial for your service from a business perspective.
How To Create a Movie Streaming App?
If you are looking to find out how to start a streaming service, one of the best aspects is to create a streaming platform like Netflix. To launch your streaming service, you can either develop it from scratch or use a white label solution which we will discuss in the coming section.
Before learning how to start a company like Netflix using a white label solution, let’s look into the technology stack of Netflix and the important features of a video streaming site like Netflix.
The Technology Stack of Netflix:
Netflix servers over 140 million hours of content every day to access the world. Building a system that can scale to that many viewers while delivering HD videos with no lag requires a lot of engineering effort. The technology stack of Netflix is to be complemented in backing their high-quality streaming services.
When Netflix was physically delivering DVDs to customers, they had on-premise data centers that housed databases and apps and maintained inventory and customer billing. However, when broadband became the norm and customers started using smartphones, Netflix started moving away from a traditional data center and harnessed the power of the public cloud. Netflix leverages Amazon web services (AWS) to support seamless global delivery and allows the streaming giant to deploy thousands of servers and huge storage within minutes.
Here is an overview of the entire Tech stack used by Netflix.
Features of Netflix-style VOD Platform:
When considering how to make a website like Netflix, it is important to understand the essential features of a video streaming platform. While your VOD platform is unique with your requirements and goals, most video on demand features is common to all streaming platforms.
Here are the important features for users, content creators, and for the admin.
The user interface (UI) and User experience (UX) are 2 significant aspects of any video streaming service. When creating a Netflix styled VOD platform, make sure you customize your VOD site to deliver an awesome viewing experience to your audience.
The homepage of a VOD platform is the first page your audience sees and where you feature the shows and movies. You can use the customer data to create a more personal homepage to enhance the user experience.
Account Creation and Login:
To allow your users to access your video streaming platform, they need to create an account and login to your platform. Offer different ways for your users to sign up and log in to your platform including login features.
After the homepage, the user profile is the next important aspect which is a virtual dashboard that helps users to navigate through the website and gain insights. Allow your users to create multiple profiles and manage content depending on the maturity level.
Powerful Search and Recommendations:
Integrate the powerful search and recommendation in your VOD platform to make it easy for your users to find the content they wish to watch. Add a powerful search with advanced filters to search for videos by topic, video length, genre, language, most popular, most watched, etc. Content recommendation is another important feature that recommends content to users based on their interests and viewing history.
Easily manage your video content and make it instantly available to stream with the video library feature.
A video player delivers the best possible viewing experience to your target audience. Integrate analytics to your video players to gain significant insights.
Payment integrations are one of the significant features of Netflix like website streaming service demand. Allow your users to make payments by their debit card, credit card, wallets, or any payment methods that are popularly available and secure.
Video Creation and Management:
To allow content creators to upload videos, you need to integrate video ingestion and management features. Make sure managing the video library is simple for content creators. Allow content creators to create and upload videos, organize, search media, create playlists, edit, and modify the information.
Offer support for several monetization models including (SVOD), and (TVOD) pay-per-view (PPV).
Promotions & Coupons:
Generate promotional codes and coupons to offer discounts
Multiple Upload Channel:
Enable your users to upload videos using an array of options such as YouTube link, Amazon S3 bucket, normal uploads, and a website link.
This feature allows you to add detailed metadata to your content. Help users discover what they want to watch across any platform.
Allow users to easily create subscription plans, manage the prices, details, and more.
Add multiple layers of security protocols so that user data stays secure and free from any threats or data losses in the future.
Provide the ability to store the earning in the wallet
Integrate powerful analytics and reporting systems to analytics and measure the performance and user engagement in your VOD platform.
An admin dashboard is another essential feature for content moderation, payment management, advanced analytics, and more.
Choose a video streaming solution that allows pre-integrated notification engine integration to update your users about new content arrivals or send other custom notifications.
Include a multilingual system that gives the best user experience. It allows visitors to view the website in their own preferred way.
iOS and Android Apps:
Allow users to create native Android and iOS app with their own branding for screens of all sizes with features like offline streaming.
How to drive traffic for a Netflix like business?
Once you have made a smart business plan to start a streaming service and finally launched your service, now it’s time to think about driving traffic to your video streaming platform that Netflix has been stealing all this time. Entertainment videos by its very nature are appealing and don’t need much of a push. However, devising a marketing strategy to reach your service to the right type of target audience is critical.
Here are some of the effective strategies to drive traffic for a Netflix like business.
While being an old marketing strategy, email marketing is still one of the best communication strategy video streaming services can leverage to drive significant results. Email still is one of the most effective customer acquisition channels. For enhancing your chance of increasing the open rates of your emails, the best tip is to personalise every email you send to users. You can efficiently use bulk email campaigns as well, but ensure you use customized email campaigns when required.
Email marketing is one of the strategies that Netflix used to drive traffic to its platform.
Affiliate marketing is another effective and ROI centric marketing tool you can leverage to drive sales to your website. The structure of affiliate marketing is in a way that you pay someone for promoting your video streaming platform when there is a paid conversion.You pay a small percentage of each sale to the business partnering with you.
You can either run your own affiliate programs from your own website by using any affiliate tools to pitch and manage affiliates. The next option is to connect with affiliate networks to promote your products and services.CBS all access is a reputed brand that offers affiliate programs for websites to collaborate with other businesses to start promoting and earn commissions from the interaction.
Paid advertising is an online advertisement model that is helpful to drive traffic to websites where the advertisers pay the ad network when the ad is clicked by users. When it comes to paid advertising, there are several ad formats to choose from and limitless ways to reach new customers. Search ads and display ads are the two popular types of options that advertisers can choose from.
Search network is one of the most common options you can choose to run your advertisements. According to theGoogle economic impact report, most businesses on average make $2 for every $1 spent on advertisements. You can use google ads and capture searcher intent to run your ads successfully.
Display ads are a form of online graphic advertising where you promote your services through banners of other ad formats like images, videos, flash etc. on social media, apps, and websites. For example, see the Netflix ad posted on Facebook below. The ad helped to generate serious interest and engagement for a new release of Netflix.
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YouTube advertising is another marketing tool you can use to reach more viewers on YouTube across different devices. Google has alreadyannounced that it will allow advertisers to target viewers on YouTube based on their Google search history along with viewing behaviors on YouTube. One of the advantages of YouTube advertising is that it is relatively less expensive to target on YouTube compared to Google Search.
Netflix also uses this powerful tool to promote its shoes. For examples, Netflix launched a YouTube pre-roll campaign to promote the classic series Friends on its platform. Netflix selected some of the top searched videos on YouTube and created pre-roll ad campaigns to promote the show.
Social Media Marketing:
Another important thing is to have the right social media strategy in place for your VOD platform which will have a significant impact on how your streaming service is performing among your target users. Finding your target market and serving them according to their interests and preference will help. Optimize your streaming platform for search engines by carrying out extensive study and research on keywords.
If you take Netflix for example, Netflix pays huge importance to be connected with its audience in social media bagging in high social engagement. This is yet another cost-free marketing strategy you can employ to maintain an edge over your competitors in the streaming space. It announces when a show is released and retweets the similar posts as shown below.
Not just that, Netflix has a separate social media page called Netflix helps where it talks exclusively about technical issues and errors to help users out with the problems they face.
Plan a strategy to post a certain number of posts every day. But social media is not just about the number of posts but about user engagement. The quality of content is very important when it comes to driving engagement to your posts.
And when a social issue comes up you have to take up your stand to express your support like Netflix does here.
Even though it is said that viewers don’t like to watch commercials, some of them actually like commercials during big games which is a great opportunity for streaming brands. That is why TV commercials are still one of the powerful marketing tools streaming services can leverage to promote their shows. I’m not talking about any random TV commercials, but powerful and high impactful ones likesuper bowl advertising.
Super bowl advertising is the content advertised within super bowl, the annual championship game of the National football league(NFL). While Netflix has announced that it will not be a part of the big game in 2020, Netflix has aired its “Our planet natural history series in 2019 using super bowl ads.
How Much Does it Cost to Start a Streaming Service?
Now let’s come to the most important section. How much does it cost to start a streaming service? The major part of the total cost of development depends on how you choose to create your streaming platform. As you might already know creating Netflix style websites from scratch is the most elaborate and expensive way, which might cost you a fortune.
Building a website like Netflixusing a white label solution can be a good and affordable approach. The best choice is to get a fully customized Netflix clone script that can personalize the design and features according to your requirements and goals.
StreamHash is a top-notch white-label video streaming solution provider with a blend of experience and proficient team who have delivered successful streaming solutions according to customer requirements.
With 4+ years of expertise and over 300 clients, StreamHash has managed to create a brand of its own helping video streaming business to thrive in the highly competitive digital era. StreamView is a powerful Netflix clone script from Netflix to launch your own video on demand service like Netflix. If you are looking for a clone script solution that leverages modern technology and needs a 100% source code for a one-time payment, StreamView is all you need.
However, apart from product development, there are some of the additional costs you have to bear, which are as follows.
Domain Registration and Dosting Plan:
You probably might know this already; you need a brandable domain name for your video streaming website. A domain name must be unique to your website and you need to pay a registration fee of around $20-$30 for a year which you have to renew annually. The next thing you need is hosting to power your website. When a user arrives at your site, the host will deliver your sites to the browser which will then render them as a good and usable website.
Next, to host your videos, you need the service of reputed cloud service providers. You can consider the digital ocean which offers cloud computing services to businesses without compromising on performance. For a minimum ram of 4GB, it costs around $20/month.
Some of the other suggestions are AWS EC2 server where you pay as per your usage and Linode which varies from $10/month for 2 GB to $960/month for 192 GB.
SSL certificate is an essential security feature required for every website. SSL certificates are data files when installed on a web server, activates a padlock and https protocol and allows secure connections from a web server to a browser. SSL is generally used to secure logins, data transfers, credit card transactions etc. Wildcard SSL certificate is one of the recommended SSL certificates that cost around $50-$75/year.
Have a look at the SSL certificate of Netflix.
App Developer Accounts:
Now that you have learnedhow to create a movie streaming app, you also need to understand that launching your app begins with submitting your video streaming app to the app stores, both Google play store and Apple store.
Google app store fee is $25 which is a one-time payment.
Apple store fee is $99 and must be paid yearly.
Content Delivery Network:
The content delivery network is a system of globally distributed servers to transfer media files. Have you ever wondered how Netflix delivers videos quickly and promptly to a huge number of users simultaneously? That is because of the Power of a CDN. Integrating a CDN to your video streaming website is essential for prompt and lag-free video delivery. The price of a CDN depends greatly on the number of videos your streaming platform has. On average it comes around $50 per month.
How StreamHash can help with creating a video streaming platform?
StreamHash offers Netflix clone script solution that allows you to create a professional video on demand website in return for a price that you would ever imagine. Create and launch the best streaming platform for your audience and providers with a robust admin dash with which you can modify and integrate customized features at any time.
Here are some of the aspects that contribute to the distinctiveness of StreamHash.
Being an absolute white-labeled solution, StreamHash helps to create a Netflix-like website with all the basic features and customizations according to your unique requirements and goals.
With 6 years of expertise in the video streaming industry and reputed clientele, we have valid expertise in the streaming industry creating solutions like Netflix in different niches. We boast a combination of a highly skilled team who are well versed in the field.
When it comes to the price, there is a one-time cost including lifetime upgrades. The price varies from $699-$199 which is very cost-effective compared to the overall cost to develop your Netflix-like platform from scratch.
There are 2 packages streamview offers, the ultimate and the deluxe package with various benefits. Explore the plan here.
We offer complete after sales technical support and assistance after the product is delivered to you. Our team of experts will be at your side to guide you with customizations and even after the final delivery.
We focus on delivering the best quality service to our clients to promote the growth of their business. We owe our industry success to our client strength. We have a long term association with our clients.
Here are some of our prestigious clients who are running their business successfully with StreamView software.
The video streaming giant Netflix is categorized as one of the simplest and most used services in the world, according to SiegelGale. Netflix has become a part of our lives today, it allows us to view lots of shows and movies without going in the hole financially. Therefore, planning about how to start an online video streaming is a lucrative business idea. Building a video streaming business will not cost you a bomb anymore! For any expert guidance and assistance on creating an online video streaming website, contact us right now!
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The greatest secret of a successful video streaming business lies in its business model. A company’s revenue model is the way it makes money. When choosing a revenue model, most businesses wait until the very end of development and simply look at what industry leaders are doing, altering it slightly. But when considered carefully the revenue model can be a very powerful tool and it is highly important to shape it according to your business needs. If you want to create your own Netflix, you must choose the revenue strategy that compliments your streaming business.
Netflix’s annual revenue in 2018 has hit $15.8 billion continuing to secure the impressive figures Netflix enjoyed over the last decade. By the last quarter of 2019, Netflix generated total revenue of $5.2 billion which is over $1 billion up from what it earned in the corresponding quarter of 2018.
If you are looking to find out how to start a video on demand website, we will be briefing it in this blog. The business model of Netflix, popular revenue models to follow, costs involved in creating your own Netflix also comes under the scope of this blog. Let’s get started.
Netflix Business Model
What Netflix succeeds at is known as video on demand, by allowing users to access content like TV shows, movies, and other series instantly through Internet-connected devices like PC, laptop, tablets, smartphones, over the top box connected TV, Internet-connected TV, etc.
This video streaming on demand giant operates on a subscription-based revenue model where users pay for a monthly, quarterly, or yearly subscription plan and gain access to streaming movies, shows, originals and other content available on Netflix in the Standard Definition (SD), High Definition (HD) and Ultra HD quality based on what they pay for.
The primary revenue source for Netflix is subscriptions. That is, users pay to access content on Netflix and that is how the company makes money. Learning more about the Netflix business model will significantly help you in choosing the best revenue model for your VOD business. Netflix offers 3 different plans for users based on the streaming quality of the content provided.
Basic– This plan offers access to content in SD quality.
Standard– This plan offers HD content access to subscribers.
Premium– This plan allows users to access videos in ultra HD quality.
Popular Video-on-Demand Revenue Models
The very first step of learning how to start a streaming service like Netflix is to choose the right monetization model for your VOD platform. What is the best way to charge users to access your content? In this blog, we are going to break down common VOD revenue models so that it becomes easy for you to choose the best one that suits you. Let’s get started.
Subscription Video On Demand (SVOD)
The subscription video on demand business model is the one that allows users to access an entire library of videos for a recurring fee. This fee may be charged weekly, monthly or even annually. Once a user subscribes to the service, they can watch as many videos as they want until the subscription period ends. Netflix follows this model to monetize its services. Subscriptions are auto-renewable and users have the flexibility to cancel them anytime. This model suits platforms that have a huge variety of entertainment content like movies, TV shows, drama series, TV programs, etc. to engage their audience on a long term basis.
One of the biggest advantages of SVOD is the recurring revenue stream that ensures a steady income every month. It also gives you the chance to upsell your users to bigger packages getting more money for your business.
While SVOD offers great chances to upsell, it becomes hard to upsell from a cancellation. That means once a subscriber cancels the plan, it can be difficult to bring them back to your platform.
Advertisement Video On Demand (AVOD)
Advertisement VOD is the business model where viewers are allowed to watch videos for free but they must watch advertisements at different points throughout the length of the video. Ads are powerful and advertisers generally pay huge amounts for streaming their ads on your video on demand platform. You can also choose your ad pricing depending on your platform’s popularity and the type of content to be chosen for the ad.
If you are just thinking about how to start a streaming service, it is recommended to design your services based on the ad-based business model. As your VOD platform gains more users, you can expand to other monetization models eventually.
VOD ads are broadly categorized into pre-roll, mid-roll and post-roll ads. As the name suggests pre-roll ads refer to the ones that play at the beginning of a video. Whereas, mid-rolls play ads in the middle of a video and post-rolls play ads at the end of a video. These ads are generally skippable or non-skippable in nature depending on how the ad network chooses to keep them. YouTube works primarily based on this revenue model.
AVOD works the best if you are new to the business as it brings in additional revenue with very little investment of your money and effort. This is one of the most common and easy ways to generate passive income.
As ads are everywhere online, too many of them can annoy your viewers.
Transactional Video On Demand
The transactional VOD business model allows you to buy content on a pay per view basis. It is exactly the opposite of what SVOD is. Instead of paying for the entire content, viewers are required to pay for only the content they want to view, buying a piece of individual content also facilitates users to keep it with themselves either on your VOD platform or download to their personal devices. Alternatively, TVOD can also allow users to rent a piece of content from a video streaming platform for a period of time and once the period expires, they will not be able to access the same content again. The transactional model works with live programming where users purchase a particular piece of content to view it. WWE streaming service is an example.
In TVOD, there is no confusion in understanding what your users prefer. You can easily understand whether there is a great demand for a particular video or a type of content. It also brings in better revenue opportunities for new content releases.
In the TVOD model, user retention is a common problem as users have a tendency to pay for particular content and then go off the platform. For the same reasons, it is difficult to push users to purchase new content.
Hybrid Video-On-Demand Model
When you have a vast library of videos and your platform is getting popular day by day, you can implement a hybrid of different revenue strategies to monetize your videos. You can choose a hybrid of AVOD, SVOD, TVOD, or any combination that works for you. If your audience base is deferred and you want different monetization models to target to suit the needs of different types of audiences, it is best to opt for a hybrid VOD model. You might have a large set of audience who don’t want to pay for accessing content but won’t mind watching ads in between and vice versa. YouTube is one of the best examples of a Hybrid VOD platform. It doesn’t just rely on advertisements to monetize. YouTube Premium is an example.
Is SVOD the Best VOD Model to Make Money?
Subscription video on demand is the most common type of VOD service offered by streaming platforms. In 2017, 55% of Americans were using Netflix and 31 % were using Amazon Prime video service.By 2022, it is estimated that over 568.4 million users would be using these platforms. While SVOD is not the only realm of streaming giants like Amazon, Hulu, and YouTube, many new VOD businesses are using subscription models to grow their income and audience.
If you are looking for different ways on how to start a company like Netflix, it is not mandatory to follow the exact path of Netflix. Choosing the revenue model that suits your business and your target audience is the ideal way to go for it. Next, let’s look into the popular revenue models in the market and understand what suits your business the best.
Costs Involved in Running a Streaming Business
The question of how to make money using a live streaming app and how much you can make cannot be answered without learning about the cost of expenses and expenditure a streaming business has to incur to get these profits.
To stream popular shows and movies in a legal manner, video streaming websites have to bear a cost to license and acquire content which differs for different types of content. For instance, Netflix reportedly paid $100 million to keep the popular series “Friends” on its service for 2019, almost three more than its previous licensing fee of $30 million.
Unless you are planning to acquire content from content creators, you have to bear production costs for creating your own originals. Offering original series is a great way to evade licensing costs and offer exclusive content to your users. However, the production costs can go higher when producing your own content.
Once your platform is up and running on the internet, you have to compete with N number of streaming platforms including giants like Netflix, Amazon Prime, Hulu, etc. Beating the competition involves a lot of marketing expenditure. Marketing costs primarily including the expense for advertisements, payments to affiliates and device partners, and the trial month fee of every user.
Research and Development Cost
Every popular streaming website invests in the research and development department. For example, Netflix focuses a lot on research and development and that is one of the reasons why they are pioneers in the market with just a subscription-based business model.
Technology and Development Cost
From the moment you create a movie streaming website and have users visiting your site, you must ensure a seamless and lag-free viewing experience to all of them. Netflix has partnered with hundreds of Internet service providers to localize a substantial amount of traffic. Technology and development costs make up a major portion of the overall cost you have to bear.
It also includes streaming delivery technology costs and the costs involved in designing new applications and other infrastructural costs. Regarding the video streaming server costs of Netflix, it uses its own content delivery network (CDN) called Open Connect, but also depends on the service of top tier CDN Akamai. Data is stored in Amazon Web Services (AWS) where terabytes of storage can be deployed to a thousand servers quickly. It is important to leverage the services of a good content delivery network even if you are not planning on growing fast because you are eventually going to scale.
CDN offers guaranteed delivery of content to users through a geographically distributed network of servers. It transforms your streaming website into a scalable system to meet any major viewership spike in demand for your content.
General and Administrative Costs
These costs include the payroll and other expenses on the human resources of the business as well and the partnership fee needed for the administrative purposes of the company.
Besides all of these costs, there can be other miscellaneous costs like payment processing fees.
How To Price Your Content The Right Way?
Behind any successful revenue model stands a well-designed pricing scheme. It is one of the most critical elements of any business strategy, especially for SVOD services. If you are looking for how to make a movie website like Netflix, pricing your content is one of the important aspects to consider.
Pricing video will always be a work in progress and with the constant changes in the market, you need to experiment with different approaches. You will get to know your customers and their spending habits as time goes by. To help you with this, here are some tips to choose the right pricing scheme.
Consider Value and Customer Satisfaction
Building a pricing model based on the value and customer satisfaction will help you make your VOD platform as sustainable as possible. Additionally, offer your users enough choices that will help you to retain existing users while attracting a new audience. Approaches including tiered pricing, freemium, or consumption-based pricing will help your viewers commit to a plan that suits their personal preferences and needs.
Analyze Your Revenue Goals
It is significant to understand how much would your video on demand business be making in monthly revenue. Make sure to include overhead costs to your goal.
Consider The Size of Existing Followers
Once you have created a movie streaming website and gathered in a few users, analyze the size of your audience. How big is your current audience and measure the number of followers you have on social media? How many contacts you have on your email list.
For this formula, use the total number of followers from each individual platform. Your existing audience or the ones you are currently not monetizing is the main revenue potential you are going to focus on as they are our biggest supporters.
Start With A Low Price Window
If it’s your first time monetizing your services, aim for a low pricing formula. The most successful customers offer monthly subscription prices anywhere between $2-$50.
Industry and Genre Must Be Considered
The nature of your content will have a direct impact on how you price your content. The best thing is to start with basic market research to see what other subscription video services with niche similar to you are charging their customers. If you are planning to charge higher than your biggest direct competitor, you must be sure that your services are with a significant difference and offer more value to your users in terms of the quality of services. The next thing to consider is your Content type and genre. Each type of content has an industry price average that you must consider unless you offer content that’s obviously more valuable.
Niche and Specificity Matters
Niche content or micro-niche content to be specific is valued high due to its ideal audience. While small and limited, if a service is very focused on a particular niche, users usually won’t mind paying for that extra bit.
How to Start a Streaming Service Like Netflix?
You are on the right track of building a streaming solution to create a movie streaming website customized according to the preferences of your audience. The goal is to delight media consumers and ensure all-time technology support to keep your users happy at all stages.
To build a fully functional streaming website to cater to your global audience, it is best to choose Netflix clone open-source that comes equipped with all the essential features and functionalities. Clone scripts are readymade website script that comes equipped with powerful admin dashboard, web app integration options, Android and iOS native apps to get started in the video streaming industry.
You can choose the best video on demand platform providers to build your VOD platform who will customize their solution to match your preferences and business goals including the revenue model suited for your business.
Choosing A Revenue Model For Your Business
In an increasingly complex digital world. You can build profitable video on demand business by choosing the best revenue models that generate more money than you could ever think. The secret is to find the business model that serves both your customer’s needs and your business goals. Some of the best in the world are listed above and you need to pick the one that suits your requirements. We understand how difficult it gets while choosing the right revenue model when creating your own Netflix and the doubts that come bundled with it which is why we help consult on you the same. Get in touch with us now.
Live streaming is no longer a novelty for marketers. With real-time videos becoming prominent among social media users, we have seen a significant leap in the way businesses usually interact with their target audiences these days. Live video, as a part of the video marketing strategy, is becoming popular, and it is going to stay as a trend in 2020, as well.
Live streaming is gradually taking a leading place as one of the most powerful marketing tools for individuals and businesses. With its rising significance, questions like how to build a live streaming website, how much it takes to stream live videos, etc. have become some prominent undertakings among the businesses these days.
Live videos can either make or break your marketing campaigns; it’s a fact that all marketers agree with. However, you must be thoughtful to show your audience the real side of your business and offer something of great value. Live streaming can bring in more leads, conversions, and overall ROI. If you are looking for ins and outs of how to start a live streaming business, you should focus on the utility of live streaming first.
Why Live Videos For Marketing?
Businesses can stream live videos over multiple social media channelslike Facebook, Instagram, and YouTube, at the same time. They can also use this opportunity to sell their products by allowing viewers to purchase products directly with just a button click while watching the live videos. Let’s take a closer look at what else makes live streaming a popular marketing tool.
No Investment Required
One of the biggest advantages of live video streaming is it’s available to anybody with a very little investment. Compared to earlier days, when live streaming setups were expensive affairs and were accessible only to the rich brands, we now have some much cheaper alternatives for everyone. The technologies we possess today to eliminate most of the expensive requirements and it has become easier for anyone to adopt live streaming in their marketing mix.
Brands can now bypass traditional live streaming methods and reach directly to their customers with live streaming through popular social media channels. However, if the brands seek a better professional solution than social media streaming, they can also create a live streaming website of their own with some minimal investment. There are tons of affordable live streaming solutions available in the market. Having a dedicated live streaming website helps indeed, as it not only opens up the immense opportunities but also gives greater control over the brand message they want to deliver.
The Emergence of New Business Models and Sales Channels
Brands now are shifting on influencer marketing to attract audiences and sell their products. Brands are approaching influencers with a large social following and paying them for doing sponsored streams. For instance, a fashion brand can recruit fashion bloggers for a campaign that includes live streaming of their fashion shows. Besides, these bloggers can put product links on the live screen and let viewers purchase the outfits shown in the show instantly. With the rising popularity and adoption of live streaming by the brands, new business models and many such effective sales channels are emerging.
Possibilities For Brands to Create New Expanded Experiences
Live streaming brings new business opportunities for brands. They can create a more integrated brand experience for customers where an immediate channel of communication will make sure the messages flow seamlessly in both directions. For instance, sports brands can sell their products to fans who are not physically present at a game but watching the same through live streaming.
What Does It Mean For Marketers?
As it becomes competitive for brands to win customers on social media, combining both social media campaigns and paid promotions can offer an enhanced level of engagement with the audience. Live video streaming combines all of these elements into a new kind of medium with endless possibilities. By putting the capabilities of live TV into everyone’s hands, brands can deliver trust factors in a way we have not yet seen. However, we are still in the early days of adoption and are just starting to visualize the possibilities.
Power of Live Streaming For Marketers and Brands
You already know that live streaming helps brands connect with their audience more realistically. It also allows the audience to participate in a brand’s storytelling. No matter if you are a video content creator or a business, you can leverage the benefits of live streaming and deliver your brand message to the prospects in innovative ways. Let’s see different ways you can use to leverage live streaming for your brand-
Live videos are a great alternative to static visual content. Over 80% of online viewers would watch live videos than exploring other types of content. As video content is visually appealing and easier to grasp, viewers can connect with the real-time content better than any other form of content. Live video streaming offers a sense of real-time connection, which is even engaging than other content types. Allowing businesses to establish their web presence and narrate brand stories in real-time, live streaming can produce some faster results.
There is no doubt live streaming helps to reach out to millions of global users by just a click of a button. Using live stream, brands can broadcast their events to a wider audience, and utilize this opportunity to increase brand awareness among the new audiences as well. The ability to get in touch with as many people as possible without any physical or geographical restrictions is a true power of marketing in hands.
Enhance Customer Relationships
Live streaming ensures enhanced customer relations as they can interact with brands in real-time leading to trust and loyalty. Unlike pre-recorded videos, live videos connect with your audience in a more personal way, paving a seamless channel of communication to interact with the brands. Unrehearsed live video gives a more realistic touch to the brand messages and therefore, making it even trustworthy and relatable. It gives out a sense of value and transparency among the audience. The more customers brands, the more they are likely to undertake some business and recommended the brand to others as well.
Reinforce Brand Value
Treat live streaming as any other marketing medium. What message do you want to convey to your audience? What should be the takeaway for our audience? Use your live streams to make a good impression, show the audience your personality, without just making a big sales pitch.
Different Ways To Use Live Streaming For Video Marketing
Whether you are using social media live streaming, or wondering how to set up live streaming videos from your official website, there are easier ways to undertake both kinds of plans. Irrespective of the platform you choose, you can conduct various kinds of live events to attract more and more audience to your live streams. Let’s look into different ways your business can utilize live streaming to engage with the target customers.
Leveraging the power of live streaming for educational purposes can be a powerful idea. For example, a live demo on how to use a product or service can be a very honest live presentation of skills. A live demo is a practical and trustworthy solution to offer valuable information. Take this opportunity to offer knowledge while your brand builds authority in a particular field. You can even build a good part of your business around hosting webinars.
Q & A Sessions
Host live Q&A sessions to let your viewers ask questions about your brand, product, and different services. Utilize the opportunity to have real-time conversations with your audience and dig deep into your opinions about the brand. Interaction with your audience shows that your brand supports transparency, which has a positive influence on embedding trust factors.
Try to address each question individually by mentioning usernames, as it helps to build a personal relationship with your audience. You must encourage your viewers to ask questions and put comments even if your live stream isn’t a Q&A session. These sessions hold the potential to build a strong community around your brand.
For example, Humana broadcasted a live session with chef Nino answering to the questions of viewers while cooking.
Behind the Scenes Look
Broadcasting behind the scenes is a great way to get a little personal with your audience. Live stream an event, a tour of your office, and show your audience how you make your products. Even the most routine business activity might be very interesting to people who see it for the first time.
Live streaming a business victory or a celebration is another great way to share your company culture and let your viewers feel being a part of it. You can also utilize this opportunity to offer an exclusive sneak peek of your new product development status. The insights offered through such live sessions can build a special connection with your audience and can potentially attract many viewers.
Collaborate With Influencers
Collaborating with popular influencers can have a significant impact on expanding your reach. Choose influencers who have a large following on their social media platforms and websites, and can provide some expertise in a particular area. You can invite influencers to be part of your live stream, be a guest on your live broadcasts, or you can also give them some creative freedom to create their own live sessions promoting your brand.
Alternatively, you can also allow them to take your over live sessions for a period of time and allow them to post live content directly to your page. As opposed to a produced video, live streaming is an easy, honest, and unrehearsed way of reaching out to your viewers.
When you collaborate with influencers, it must align well with your brand and be organic to your viewers. Make sure you do thorough research on your personality of choice, consider their primary demographic, hashtags they use, and overall reputation. The interest and values of the influencer’s audience must also align with your brand’s message and values, making it easy to gain their attention. This type of partnership with popular influencers improves discovery and expand the reach.
Use Live Streams for Sales
Using live broadcasts for real-time sales can create a sense of urgency to buy especially if you are offering discounts exclusively for your online viewers. Set up a live broadcast displaying your special products or services, and offer a link to buy it instantly. Keep in mind that some live chats do not allow links, so you may need to get more creative. Alternatively, you can also create your own live streaming website using a decent live streaming software solution, and get better control on putting links and promoting your products even effortlessly.
Running contests on your live streams has great potential to increase the reach of your live broadcast. To improve the reach, you can ask your viewers to share a link of your live stream as a part of the entry requirement to the contest. This way your viewers become an additional marketing channel.
You can also use the contest entry requirements to expand your email list by capturing email addresses using a Signup form. Conducting contests via live streams can keep your audience engaged and you can use the platform to announce the results as well. Make sure you announce it early to increase the participation of your audience.
For example, Wingstop launched the world’s first live auction on periscope and announced it in advance in their Twitter account.
Live Stream Big Events
Nowadays it is customary for a large enterprise to live-stream large events and product launches. A live launch can help your products and services stand out and create a lot of buzz and traffic around it. Consider going live with your product launch, important events, keynote presentations, demos, etc. Build up the hype around large events in advance so that your viewers have the chance to share the news till the big day.
Conduct Live Interviews
Live interviews can act as an amazing traffic source as you are addressing not just your audience but another person’s audience as well. Setting up interviews with big names in the industry can give you instant recognition and authority in your niche. This further builds trust among your viewers. As mentioned earlier, you can also interview influencers who are from the same niche to capture a wider audience. For example, Benefit Cosmetics went live with makeup master José Rivera with 13k viewers and good engagement.
Live Stream Fun Activities
Your live broadcast need not be formal content always. To change it up a bit, try broadcasting fun activities like team actions, a humorous live, DIY crafts, or anything that your audience will find interesting. For example, Twitter live-streamed holiday-themed sessions with DIY crafts, cocktail mixing, and holiday planning tips by collaborating with top influencers.
Reveal Product Announcements
This is another significant strategy that works better when you have an audience, but it can be highly effective if done right otherwise too. Your viewers will love to be a part of the exclusive group that gets first access to big reveals and launches. Give them that privilege by live streaming product announcements or any similar events. Reveal big news on a live stream to people who tune in before anyone else.
Reuse Live Streams
Once you have a whole library of great content for viewing and reuse, reuse your live stream to promote it further. Create promotional videos, highlight videos, optimize uploaded VOD streams for search engines, and do a lot with your saved content even after the live broadcast is over.
Best Practices To Succeed With Live Broadcasts
You have some ideas and a professional live streaming solution; you are all set to utilize the power of live streaming for your business. Here are some live streaming tips and best practices to help you come off professional and engaging with the first video itself.
Set Your Goals
What do you want to accomplish with live streaming, reach a global audience, highlight product features, increased brand awareness, or grow your audience? Your goals help to determine what type of live experience to create. Create new customer experiences; offer branded moments, live stream product launches, live events, or customer education. In short, set your goals and decide what you are going to show. If you are not interested in your content, chances are your audience won’t be either.
Plan, Test, and Promote
While live video streaming happens in real, it is not wrong to plan ahead. You can and you must plan in advance. Be sure to script responses to possible scenarios that can arise, plot out key moments, and decide in advance the messages to convey. For example, if you are doing Q&A sessions, prepare responses and have a team ready to moderate comments. Before you go live, test in advance and make sure the camera is steady and the voice is clear.
It is also important to promote your live sessions in advance to keep your audience tuned in. Start by announcing about your live broadcast on your website and social media channels to build anticipation.
Welcome New Viewers
When you start live streaming, welcome all your viewers to the live session. This way you establish a personal relationship with them instantly. Also, make sure you welcome new viewers. However, it is not actually practical when you have thousands of viewers. You can also group names together so that it is easy to recognize a large number of people at once.
Address Viewers by Names
People love being called by their names, especially during live streaming. Hearing their username called out while watching a live broadcast helps feel recognized and instantly connect with the brand.
Look at the Camera
Similar to pre-recorded videos where you have to look at the camera, live streaming also demands the same. Looking at the camera is equivalent to making eye contact with your viewers. Just because you can’t see your audience, doesn’t mean that you shouldn’t look at them. This counts a lot when it comes to live streaming, as viewers might be offended if you don’t face them all the time.
Keep a Check on the Environment
Pick a good place with ample lighting and less noise when you go live. This is very important to the overall quality of the stream. Even a bad camera can look good to an extent with good lighting. Try hosting your videos during the daytime, preferably with light background behind you. While natural lighting is the best lighting you can get, you can also buy lights if you have to shoot videos in a dark room.
Choose the Right Platform
Selecting the right platform for your live streaming significantly affects the results you will achieve. If you take social networks, YouTube has over 3 billion searches a month and it is the second-largest search engine after Google. Facebook is already on the race to become a pioneer in this sector. On the other hand, Periscope is devoted to live broadcasts, which makes it easy for your Twitter audience to follow your live sessions.
So which one you must choose? The answer depends on your business goals and preferences of your audience. While Facebook Live offers options for more viewers, popups on their feed often distract them. Alternatively, you can also create a live streaming websiteto gain much control over your live videos.
How To Make Money Using a Live Streaming App?
We have discussed how live streaming can help with marketing campaigns and assist your brand to grow. Once you are well acquainted with how to create a live streaming website the next thing is to understand is how to monetize your live streams. Next, let’s look into some direct ways to use live videos to make money.
The pay-per-view allows your viewers to unlock access to your individual live streams for a fee. This works great if the content is unique. If you are using custom live video streaming software to create your website, it’s more likely you will find an option to integrate pay-per-view model to start earning from your live streams. This model works best for streaming webinars, tutorials, sports events, and other events where people don’t mind purchasing tickets.
Just like a pay-per-view model, subscriptions give access to all the streams at once for a specific period, instead of paying separately for each live session. Subscriptions can be quarterly, monthly, or yearly basis. You can also take advantage of the built-in subscription features that many custom video streaming software solutions offer. Besides access to live videos, monthly subscriptions can include other benefits for viewers like special badges, ability to chat and enjoy ad-free live streams.
Another great way to earn money using your live streaming app is by running advertisements. If you join the right live streaming platform in social networks, you can make money from ads as many businesses are still relying upon advertising bucks.
For example, Facebook live ads have benefits for both marketers running the ad campaigns and live streamers allow the ads to be shown during their broadcast. If you use live streaming software to broadcast live sessions, you can run ads in your live streams and it can be pre-roll, mid-roll, display ads, or overlay ads.
To exercise more control over the advertisements displayed during your streams you need to get into depths of how to make your own live streaming website. However, it not the best idea to have ads as the only monetization channels during live streaming.
Brand Collaborations and Sponsorships
Brand deals and sponsorships are another great way to make money using live streaming app. It works well when you have a recognizable name for yourself in the industry as brands will reach out to you with deals. If they don’t, you have to reach out to engage with businesses for sponsorships. Either way, you can make money streaming through banners ads, sponsored content, and more. While sponsoring content make sure it doesn’t appear as a sellout.
A membership in affiliate programs will help you earn commissions every time a viewer clicks on your affiliate links and makes a purchase. Affiliate sales are not just limited to links; it can be even a coupon code that you are promoting. You can place the link or coupon code anywhere in your live stream description. While participating in affiliate programs, make sure to keep your content and the product or services you promote is relevant to the content you stream to make money using live streaming app.
Live streaming is a major shift in the way customers interact with business and each other., People are becoming more comfortable in getting on camera and engaging with others. This is also a great opportunity for businesses to market themselves and remain at the top of the industry. Create a plan now to include live streaming in your business marketing strategy. Capitalize on live streaming while it is still in its early development stage before all the big players gain the possible and it becomes harder to get into. If you want any assistance in creating a live streaming website, get in touch with us. We would like to help you out.
Video streaming is a buzz now! The old cable TV is having less deal now. Those days are gone where people used to wait to watch their movie on the television. With time the scenario has changed when online content came into existence.
With the digitalization, users are shifting from analog to digital, which helps to make a choice and get the required content, resulting in increasing their entertainment experience. Also, Viewers can access personalized content with various devices of their choice and record the same content to watch the same in the later period.
The most dominant type of VoD content watched across all regions is movies, followed by TV programs. The other most-watched content types include comedies, series, sports, documentaries, and short-form video content. VoD service providers are continuing to expand their offerings to include a diverse set of content programs. For much better experience users deal with a single video streaming provider rather than managing multiple accounts can be easier.
The Video on Demand Market globally is estimated to USD 56.26 billion in 2017 and is expected to reach a value of USD 93.99 billion by 2023 at a CAGR of 8.93% by the research done by Mordor Intelligence. The research says that video on demand industry has a wide range of scope and for both cable operators and content providers to generate revenue.
With the increasing popularity of online videos, the CDN (content delivery Network) and MVPD (multichannel video programming distributor) are being pressurized.
The overall improved customer viewing experience and cost of the service are the two potential drivers for boosting the video on demand to the peak. The world of video streaming is now crowded by the many dominant players in the industry. If you are looking for cutting the cord, then the infographics below would help you choose the best streaming service by price, usability, and content to try.
With Blockchain solutions revolutionizing the cryptocurrency and financial markets, it is set to mark its footprint in other industry verticals. Global spends on Blockchain solutions have shown more than 100% year over year growth from $945 million in 2017 to $2.1 billion in 2018. It is expected to provide a business value-add of $176 billion by 2025 and $3.1 trillion by 2030 across various industries.
What is Blockchain?
The blockchain is simply a data store that is distributed across multiple network channels. By design, it is a decentralized technology where a network of computers together manages the validity of transactions.
Originally devised for secure digital currency (Bitcoin) transactions, it uses a ‘block-based’ model that operates across a peer-to-peer network with no single authority. Participants can see the transactional data and verify or reject it using consensual algorithms.
Benefits of Blockchain solutions in industry applications
Faster and secure transactions – With no central authority or middlemen to take care of, Blockchain can speed up the transactions and makes sure that the data is incorruptible and secure.
Transparency – Data in the Blockchain can be publicly accessed by all participants and hence cannot be altered or deleted.
Cost-effective – Online payment portals like PayPal charge around 2-5% as transaction fees depending upon the geography. Blockchain technology can eliminate these third-party risks by helping you do direct transactions.
Simplified transaction ecosystem – With a single public network taking care of all the transactions, it reduces the clutter and complexity of multiple ledgers.
Traceability – One can exactly track the location of items and their displacement can be easily followed up and communicated for further actions.
Cryptographically sealed data – Using cryptography to protect the user’s data, it ensures that all the transactions are safely executed by securing even minute details.
Real-time data management – Blockchain technology’s peer-peer operation renders real-time data processing, resulting in faster communication and easier coordination.
Automated actions – Blockchain is programmable, helping you to automatically trigger actions once the conditions are met.
Blockchain’s take on the future of Media and OTT industry
With such numerous advantages, the Blockchain model had already started to revolutionize the digital finance market with flexibility and secured transactions. On the other hand, a sophistication of internet has led to the evolution of OTT industry. From a video series on YouTube to a proper third screen experience, it has attracted millions of users towards its ecosystem. As the industry matures, it is starting to face problems and let us see how the use of Blockchain technology can make the OTT industry more stable and convenient than ever.
Empowering the online content creators through smart contracts
What if the digital content creators like online musicians can get directly paid by their fans without having to give out large percentages of their sales to third-party intermediaries? This barrier-less communication system is possible through Blockchain, removing any hidden intermediary costs and helps artists establish a direct customer relationship with their fans.
Blockchain also helps them to automatically take care of the license and contract related issues in the form of smart contracts.
Decentralised Content distribution models
Blockchain enables each party to verify their transaction records directly without any intermediaries. It also eliminates the need of any central authority to approve the transactions through its peer-to-peer network, making way for agile and smooth transactions.
Accessibility and ownership
One of the long-standing issues in the online media and OTT industry is the ownership and access to the content. Consider a video subscription service, where you pay for gaining access to the platform and the videos cannot be accessed anywhere outside the platform. There is hence, a lack of transparency unlike buying a traditional cassette or a CD which you actually own it.
By leveraging Blockchain technology, the issue of music ownership and sharing can be tackled at an infrastructure and protocol level. It encrypts the video and music tracks, and stores these permanently through the interplanetary file system (IPFS) swarm. And the tracks can be accessed from anywhere with decryption keys through smart contracts.
Advertising analytics and targeted marketing
Worldwide spends on digital advertising is $200 billion in 2017 and expected to reach the $350 billion mark by 2020. Digital advertising is highly advantageous to marketers as they can track the consumer’s behavioral data. But, more than 60% of digital video advertisers lack adequate tools that can analyze this data, to measure and effectively improve the digital campaign’s performance.
According to Visa’s report, Blockchain has a capacity to pull out more than 24,000 transactions per second. It also makes the marketing investments targeted, helping the advertisers to measure the efficient platforms and add more value to their marketing efforts.
Media royalty payments
Payment of royalties to the artists and copyright owners has been a long-unsolved problem in the online media industry. Spotify was dragged into a $30 million settlement by National Music Publishers’ Association (NMPA) over unpaid song royalties, and other several legal cases were also raised against similar streaming services. The payments weren’t received because Shopify couldn’t identify its publishers.
Blockchain can bring these issues to rest by using a Cryptographic Hash file to store the original music track. With each Hash file associating the address of the creator, the artists and the copyright owners can be compensated in the form of smart contracts.
Easy transactions and micropayments
Blockchain helps to facilitate the micropayments online within the user and content creator without any transaction costs or service charges. By using a Blockchain enabled browser, the user can monetize their monthly spends using a cryptocurrency wallet. The browser can then request the public Blockchain for license information, and scan the loaded content through content identifiers. Accordingly, it facilitates the transaction between the user and the content owner via on-chain payment.
With terabytes of content consumed in the online media every day, optimizing the storage space is essential. A Blockchain-powered Content Delivery Network (CDN) can help to utilize the collective unused space from the users worldwide by building decentralized applications. Using Blockchain as a decentralized management system can help the users exploit this collective unused space, by converting it into a peer-to-peer cloud storage and data delivery network.
Content licensing and effective monetization
Online content creators are very much aware of the extent of protection the Intellectual Property Laws give and how easily their content can be stolen. When someone is using your Intellectual property for commercial purposes, you can claim the ownership compensation. But, when you are dealing with a larger organization, the burden is entirely yours. You may have to hire a lawyer to prove the ownership and then enforce your rights where you might still lose!
Adopting Blockchain technology can help you to easily defend your Intellectual property rights. The ‘blocks’, which are located on a variety of servers around the world cannot be altered once they are created. Hence, content owners will have complete control of their work, and the transactions are automated whenever the content is accessed by viewers.
With the online media and OTT space growing more competitive than ever, it is set to be the future of the broadcasting industry. Adapting the Blockchain technology to OTT and online media can definitely make this billion dollar industry much more accessible, leading to an uprise in digital space like never before!