Monetizing OTT Services: Ways and Advantages

Monetizing OTT Services: Ways and Advantages

Over the Top or OTT service are those where the service provider does not decide which program should be watched by the user. This is unlike traditional television (linear TV) where the show timings and prefixed. A user has to go by the program broadcasted in those cases, whereas, video on demand (VOD) based OTT, the user decides what he wants to watch and when.

Growth of OTT

With the tech-savvy generation coming up, the growth of OTT has been tremendous. Today’s youth no longer enjoy watching linear TV sitting in one place. They like to take their entertainment with them. Since OTT services can be accessed from devices like smartphones and tablets with an internet connection, it is becoming more popular by the day. OTT is also cheaper as the user has to pay for only what he is watching.  

It has been observed that the OTT subscription is growing exponentially in the US. It is expected that from 2018 the overall revenue of OTT services will grow 63% in the next four years.

Ways to monetize OTT

Monetizing OTT services is not rocket science, and there are many ways to do it. The following are the three most common ways:

  1. The Pay-Per-View/Pay-Per-Download method: This works similar to paying for CD-rentals in the good-old-days. Here the online content is rented for a particular amount of time or for a one-time watch through this method. PPV method works well for things like streaming a live event. Another option is Pay-Per-Download, where the user can pay a one-time fee and download the content.
  2. Subscription method: This method is more commonly used by OTT giants like Netflix, Prime, and Disney+. In this, the user does not buy access to particular content. Rather he pays a subscription fee to be able to access all the content that the platform has to offer for a time period.
  3. Advertisement: Ad revenue can be made from any content. OTT services are no different. Whether it is just audio content or video content or games, money can be made to display ads. Usually, the video ads are inserted between the live streams or content. Action taken on those ads can also be monitored.

Advantages of OTT advertising

For advertisers, OTT advertising will prove to be very useful. It reduces the cost of advertisement as it is pay-per-view or some other format rather than for simple ad placement. OTT services make it very easy to display an ad to your target audience by analysing their behavioural patterns. It will be much easier to track the performance of a particular ad campaign. It allows for real-time monitoring of your viewership and gets real-time feedback.

The OTT industry is growing steadily and along with its revenue. It has a higher scope of expansion than traditional TV as accessing it has become much cheaper. Earlier there was one TV in a house where all the members watched the same programs and ads. Now in a house with four people with four smartphones, they all can watch different shows and encounter different ads. That is the potential of OTT. With smartphones becoming cheaper by the day, the possible consumer base is also growing.

Leave a Reply

Your email address will not be published. Required fields are marked *