Researchers report that the OTT market reached a value of $120,34 billion in 2022 and is projected to grow at a CAGR of 14,1%. The primary drivers of the market’s revenue are the accessibility of mobile devices, affordability of OTT services, and expansion of the Internet.
In other words, OTT video streaming services are in demand among both businesses and customers. Viewers take advantage of their convenience and flexibility. Moreover, what attracts them the most is original content and affordable prices. Streaming services are less expensive than traditional television and offer varied content.
Due to this demand, it is beneficial for companies and enterprises to launch their own OTT streaming platforms. They can make money by creating content and publishing it on a service. Let’s observe how an OTT service can help you make revenue.
How Can an OTT Video Streaming Service Bring You Revenue?
Before we dive into details, we need to mention that launching an OTT streaming service requires OTT solutions. You can create yours from scratch or obtain a ready-made white-label solution that has all the necessary components for your business to operate. For example:
1. Monetization models
In case you opt for white-label, OTT advertising, subscriptions, pay-per-view, and hybrid are monetization models you can get with the right OTT solution.
- An ad-based revenue-generating approach means that you run commercials on your videos. Usually, this model allows your viewers to access content for free since income depends on advertisements.
- Subscriptions are the most popular monetization model in the OTT ecosystem. Viewers purchase monthly or yearly access to the content library on your platform. They can watch as many videos as they want without any limitations.
- A pay-per-view is also referred to as a transactional-based monetization mode. It gives users access to a purchased video instead of all videos available. So, each video requires payment.
- A hybrid monetization model is a combination of several approaches described above. The most famous illustration is Netflix which added an ad-based subscription tier to its pricing options. Now, viewers can choose whether to remove ads with a subscription at a higher price or pay less but watch commercials during the playback.
You may choose one monetization model or opt for a hybrid approach. It is up to you to decide. Keep in mind your business goals.
2. Applications
Applications are what can help you cover as many devices as possible: from mobile phones to TVs. It is vital as people use different gadgets throughout their days. Someone prefers watching videos on laptops, and others utilize Smart TVs.
It means that you won’t be able to reach some people if you don’t have apps, for example, for smartphones but have for TVs. Your viewers will need a TV to access your service.
Covering more devices allows you to be closer to your viewers and remind them of your service from time to time via push notifications and newsletters. The more devices you can cover, the more viewers you might have.
3. Content Delivery Network (CDN)
Since your revenue depends on the number of subscribers, you can increase your user base by reaching people around the world. CDN solutions might help here.
A content delivery network is a network of dedicated servers distributed around the world. Thanks to it, your content will be transmitted from the server closest to a user who made a request instead of the origin server that might locate miles away from your customer. It helps to speed up the delivery of videos and boost the quality of the experience.
Final Thoughts
The primary goal of a video streaming business is to generate revenue. Luckily, companies developing the solution implement features that can help you achieve your purpose. CDN, applications, and monetization models are just a few components. There are also analytics and personalization tools. In addition to marketing and content, these features can bring you success.
