Today, video on demand platforms are poaching TV viewers from across the globe. What is the reason for this huge popularity? Access to thousands of popular movies, TV shows, and originals in one single platform can satisfy any taste. Convenience and affordable packages also make them a primary choice over traditional TV.
Netflix is one of the largest providers of on-demand movies and TV shows on the Internet. As of 2019 first quarter, it has over 139 million subscribers and the company is still leading the charge over its competitors.
Looking at the grown-up popularities of the video streaming platforms like Netflix, Hulu, HBO Go, etc. it can be said that building a video on demand website like Netflix could be a profitable business idea. A platform where you can draw good traffic, sell subscriptions, and make untapped money through video content from different creators, suppliers, and labels.
Why Obtaining a Video Content License Is Important?
To keep your subscribers happy with a number of choices available, Netflix is constantly working on new licensing deals with TV show creators and movie makers. Licensing for online streaming content is the process of getting permission from the owner of a content to stream it through an on-demand platform like Netflix.
If you are planning to build a Netflix like website, a licensing agreement is essential under which the terms of a legal contract between you and the content owners will be defined. It starts with copyright, which is a legal right of ownership that allows content creators to control how it is managed and whether it can be copied.
Related Content – How do video on demand sites get their content
Unauthorized use of copyright content will result in copyright infringement that can lead to legal confronts. Usually created in the form of written consent, a video content licensing is given to the third-party by the copyright holder for the use of their content. The agreement can involve a price paid for the license, the limit of use, and the Internet broadcast viewers.
For example, the owner of a TV program can allow you to stream all the seasons of a particular show on your online platform but only until a specific period. Once the period of the agreement expired, it can be renegotiated or dropped depending on terms, more business opportunities, and your viewers’ interests.
How Does Licensing For Video Content Work?
In video on demand, licensing involves 2 parties- The content providers and the broadcasters. The agreement you make with the content providers will give you permission to stream the complete show for a period of one or more years. At times, content owners sign multiple contracts for the same video content with multiple on-demand platforms. This is known as non-exclusive agreements and far less expensive than exclusive agreements.
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Exclusive agreements are a differentiator among content providers, especially when there are a large number of video-on-demand services in the industry. An exclusive license agreement between a content owner and broadcaster can be fixed for a specific number of years where the broadcaster will have exclusive rights to manage and stream the content. Exclusive agreements are massive investments and come with a hefty price. However, exclusive content can draw large numbers of subscribers to your video-on-demand platform.
Video Content License Management
Content licensing management is based on the avails that outline specific license rules about when TV shows or movie content can be shown. The Entertainment Merchants Association (EMA) has set pre-defined digital supply chain standards. Many of the popular video on demand platforms follow a non-proprietary transactional solution called EMA avails, and they are successfully incorporating it into their workflows.
EMA avails includes data like title, language, episode title, episode number, viewing time frame, wholesale price, license type, caption availability, total run time, license rights description, and a lot other within the EMA standards.
Related content – How a movie gets released on Netflix video streaming site
Major studios and on-demand services who support these content providers are adapting their systems to be EMA Avails complaint. Securing Netflix licensing with moviemakers and content owners is one of the greatest expenses for Netflix. The company spends over $15 billion on production and content licensing.
The growth of on-demand content has made it more difficult to obtain licensing inexpensively. Netflix uses customer data mining to find out which content subscribers pay to watch and relies heavily on this info to determine the cost of each Netflix licensing agreement. Data is compiled to determine the expected hours of viewing each movie or a TV program generates over the period of a licensing agreement. Finally, this metric is compared with content arrangements, and it fixes final pricing on exclusivity and the time frame of the agreement.
How To Get A License To Stream Movies?
Unless you are using movies for non-commercial use, the law states that you must obtain permission from the copyright owner for any content that you have not created yourself but want to use or share. To start with the process, you have to approach the licensing team of a studio and the licensing agreements will differ with the type of content and studios.
The next step is setting the video content licensing fee. Depending on the type of video, its intended use, the nature of the content and the usual laws surrounding supply and demand, the price of licensing can vary considerably. The video license agreement cannot be finalized with single pricing as a large number of a variable affects the price. If the original content is used to generate revenue, then the content owner and licensee can each take a share on the transactions (in case of AVOD or SVOD) if it is mentioned in the agreement.
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One last thing to be noted is that you need to make sure that you carry all your necessary documents and licenses to stream any video content on your website. Re-collect if you have any dues that need to be cleared, which you might have paid for the templates on your website. Publishing commercial website may be easy, but certain things must be taken into account since your venture directly relates to financial elements and also license based concerns.
In a digital era where everyone can create and distribute media, the regulations of engagements between the entertainment industry and views need more clarity. One thing that you must keep in mind is that you need to get the required permissions and licenses along with usage rights in order to stream your video content. If you are looking to stream TV series or movies, you must be rest assured that you have a license to stream this content. In case you are accumulating content from independent video providers, then make sure the viewership and ownership rights are capped by an agreement.