SVOD vs AVOD, discover which of these VOD models makes more money in our expert guide!
Video on Demand (VOD) is becoming a profitable business model with the rise in technology.
However, to build a profitable VOD model you need to choose between SVOD vs AVOD. Likewise, take into consideration factors like content type, audience demographics, CMS and financial goals.
Unfortunately, It can be a hassle deciding which VOD model makes more money especially as a newbie in the video streaming business.
But, no worries, in this guide, you will discover the difference between SVOD and AVOD, which is profitable and how to scale up in less time.
Let’s get started.
Table of Contents
Key Takeaways
- SVOD platforms work on subscription plans to access exclusive content.
- SVOD platform spreads costs over a vast subscriber base, maximizing profit from each new subscriber
- One key difference between SVOD and AVOD is that the later is ad supported while the former is not.
- SVOD model makes more money when compared to AVOD platforms because it has a recurring and consistent revenue stream.
- Your chosen VOD platform influences the access you can grant your users. This includes passworded content, geoblocking or restricted download to protect premium content.
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What is a SVOD?
SVOD or Subscription Video on demand, is a streaming model that allows users to subscribe at a fee to access premium content. This payment is mostly recurring as users have to renew their subscription to access content continuously.
SVOD content is ads free, so viewers can stream video without interruption. But, SVOD comes with different subscription plans such as monthly, quarterly, or annually. Examples of SVOD platforms include Disney+, Hulu, Netflix, and HBO Max.
Hence, a key difference between OTT and SVOD is that the latter is solely ad free.
How Does SVOD Work?
SVOD platforms work on subscription plans to access exclusive content.
To begin, viewers have to sign up or download SVOD apps, create an account and choose suitable subscription plans. Once subscribed, viewers can browse the video content library for interested content.
Likewise, viewers can stream video in real time over SVOD platforms. Also, users have access to watching video offline by using the download option.
SVOD platforms are updated with fresh content. Hence, subscribers have a new and updated library of content to select from.
Benefits of SVOD
You need to know the benefits of SVOD to be able to choose between SVOD vs AVOD. SO, here are the benefits of SVOD:
Consistent Revenue Stream
SVOD platforms generate consistent and predictable revenue through monthly and yearly subscription fees. Hence, as long as subscribers remain active, SVOD platforms are assured of a steady cash flow.
This model makes it possible for platforms to budget effectively and plan for scalable content and platform enhancement which attracts more subscribers. Depending on the subscription models, SVOD platforms earn monthly, quarterly, annually.
Ad-free Streaming
More viewers are drawn to SVOD platforms daily as it offers ad-free streaming.
In other words, viewers can enjoy their favorite video content without being interrupted by annoying ads display. This model enhances viewer experience, and is more appealing compared with free alternatives that display ads.
High Profit Margin
Yes, SVOD platforms cash in big from their streaming services from subscribers fees.
In contrast to traditional ads display, SVOD subscribers pay consistent fees to access premium content based on stipulated plans. These fees paid monthly, quarterly or annually are made by millions of loyal subscribers on this platform leading to high profit margin.
The cumulation of each subscriber’s fees adds up to give a high revenue stream. This means, SVOD platform spreads costs over a vast subscriber base, maximizing profit from each new subscriber. Also, some subscribers do pay for a year’s plans or more upfront which equates to high profits in less time.
Committed Subscriber Based
SVOD platforms are builts on committed subscriber bases who find their content valuable enough to pay for it.
When a platform offers quality and unique content on a regular basis, it attracts loyal subscribers. Moreover, committed subscribers are often drawn to platforms with updated libraries like SVOD platforms. Hence, to stay connected with their favorite video content, loyal subscribers renew their plans regularly and pay upfront to access these content.
SVOD Service Platform Provider
Are you considering starting a SVOD service? If yes, below are top SVOD service platform provider:
Adilo
Adilo is a robust Subscription on Demand (SVOD) provider with advanced video streaming features. It combines security, monetization, analytics and more features in delivering quality streaming to meet demands of businesses, online creators and marketers.
Here are key features why Adilo is the best SVOD service provider in the market:
- Unlimited hosting service
- Ad-Free streaming
- Video split testing
- DRM and security
- Video CMS
- Video Playback
- SEO option
- Screen and camera recorder
- Customization
- Monetization
- Analytics
Wistia
Wistia is a video subscription platform provider that enables you to host, manage and optimize your videos effortlessly. You can leverage Wistia’s Content Management System (CMS) including folders tags and secured sharing options. Additional tools include analytics tools, monetization options, SEO tools.
Vidyard
Vidyard is an advanced video platform that offers tools like AI-powered script generation, video hosting and automated processes. This helps optimize your SVOD service with its robust analytics. Also, its customized video messaging, monetization options, and customization option guarantee quality video production.
What is AVOD?
AVOD or Ad-base Video on Demand is a video streaming platform that allows viewers to watch video content for free in exchange for watching ads during videos. This helps reduce costs for viewers who can’t afford to pay for subscriptions.
These ads are often disrupting as they are displayed before, during or after content playback which is similar to traditional television commercials. In contrast to SVOD platforms, AVOD generates revenue through ads sales rather than subscription fees.
Hence, one key difference between SVOD and AVOD is that the later is ad supported while the former is not. Examples of AVOD platforms include YouTube, Hulu, Tubi, and Pluto TV.
How Does AVOD Work?
AVOD platforms allow viewers to watch video content such as movies, and TV shows for free. In turn, users have to watch ads embedded within the video.
This model makes content accessible to a broader audience who have access to free content. However, the ads displayed are mostly relevant to the viewers sorted based on viewers location, demographic and viewing history.
These platforms such as YouTube generate revenue from advertisers who pay based on ads impression such as number of views or clicks. The higher the platform viewers, the more revenue they can generate.
Benefits of AVOD
Here are benefits of AVOD platform:
Broader Audience Reach
AVOD platforms remove financial restrictions that may deter lots of audiences. Hence, these platforms attract more audiences from different locations and demographics.
The removal of subscription plans makes these platforms reach a broader audience including viewers who are on a tight budget and those who can’t commit to paid subscription.
This model employed by AVOD makes it an ideal choice for businesses seeking to grow their traffic and brand awareness. Oftentimes, these incoming traffic might not be interested in the services rendered by these businesses.
Flexible Revenue Generation
AVOD offers a flexible revenue generation through various ads types and displays.
These platforms support different types of advert placement including pre-roll (before a content starts), mid-roll ( during the content) and post-roll (after the content).
Likewise, ads can be personalized and targeted towards a viewer based on their locations and demographic.
Also, AVOD platforms generate more revenue by charging advertisers based on impression, number of views or clicks.
Advertisement
AVOD is highly recommended for businesses seeking to advertise their product and services to a broader audience.
Businesses can leverage these digital ads mediums that distribute personalized ads to viewers. In other words, your advert is more likely to reach viewers who are interested in your business.
Most importantly, since viewers are willing and patient to watch ads in exchange for free video content, you can be sure that these viewers would watch your entire advert content.
Free Access for Users
Yes, video content can be watched for free without any hidden cost.
Therefore, viewers that are budget conscious or unwilling to commit to SVOD platforms should cling to AVOID platforms. Hence, viewers on a low budget have nothing to worry about as they can still follow up on their favorite movies and videos.
Unfortunately, viewers have to tolerate ad display in exchange for free content.
SVOD vs AVOD: Which of The VOD Models Makes More Money?
SVOD and AVOD models are both profitably VOD service platforms with distinct monetization plans.
However, SVOD model makes more money when compared to AVOD platforms because it has a recurring and consistent revenue stream. This means, SVOD have predictable subscription fees per user especially for platforms with high-quality content.
AVOD on the other hand, also generates high income when it reaches a large number of viewers. But, this can take longer and isn’t predictable.
When deciding between SVOD vs AVOD in terms of revenue stability, SVOD models guarantee stability for cash flow, making it easy for platforms to plan and structure content. In contrast, AVOD revenue fluctuates as it’s influenced by the number of views and advertiser demand.
Additionally, SVOD when compared to AVOD attracts loyal subscribers who are willing to keep renewing their subscription to access quality content.
Why Do SVOD Models Make More Money?
Still indecisive which platform to choose, SVOD vs AVOD?
Below are key reasons why SVOD models makes more money:
Predictable Revenue Stream: SVOD generates revenue through subscription fees which could be monthly, quarterly, or annually. This revenue model is predictable as businesses can analyze their incoming revenue over a period of time and predict what to expect moving forward.
Higher Revenue Per User: Yes, the money paid per user on SVOD services is high compared to the amount earned per views on AVOD platforms.
Also, SVOD subscribers often pay upfront for 1 or 2 years to secure access to streaming services. Likewise, users are quick to renew their subscriptions, all of which equates to higher revenue per user.
Loyalty and Retention: SVOD subscribers are loyal and committed to their platform, this is reflected in their willingness to renew their subscription plans.
Exclusive Content: Premium content is delivered via SVOD platforms. This is usually content not easily accessible or available on the internet for download by anyone. Hence, viewers can access movies or series not available on the web for free on SVOD platforms.
Less Dependence on Ads: SVOD are ad free when delivering its content to its viewers. Subscribers who want uninterrupted video streaming opt for SVOD platforms and don’t mind paying to achieve this.
Content Ownership: SVOD platform grants you full content ownership and control. You are at liberty to choose what security features protect your content, likewise, the access you grant to your viewers.
Benefits of Choosing the Right VOD Model?
Having a glimpse of the benefits of choosing the right VOD model will guide you on choosing between SVOD vs AVOD models.
Here are the benefits you stand to enjoy:
Flexible Revenue Generation
The right VOD model gives you flexible revenue generation options with high profit margin.
There are a variety of VOD models with different revenue options. Some platforms (SVOD) allow you to earn monthly income on individual subscription plans, creating a steady revenue stream.
On the other hand, other VOD platforms (AVOD) give you the flexibility to earn revenue through advertising options or based on transactional (TVOD). Hence, depending on your financial goals, you get to choose which VOD helps you achieve your goals.
Audience Reach
You can leverage the right VOD platform to reach a broad audience across many regions.
Perhaps, you intend to create awareness for your product and service to a global audience, don’t hesitate to use VOD models like AVOD that gives you access to large traffic who are likely to be interested in your brand.
Also, if you seek niche audiences you can utilize VOD platforms with strategic SEO to attract your targeted audience. For instance, you can build a committed subscriber base for your streaming platform like SVOD that aligns with your long-term goals.
Content Security and Privacy
Content security and privacy is vital to gain and maintain your viewers trust. Likewise, choosing the right VOD platform helps protect your video content from hackers.
If you have your content at heart, you must invest in robust security features like Digital Rights Management (DRM) or encryption to keep off unauthorized download and sharing of your content.
SVOD, AVOD and TVOD offers you the flexibility to choose advanced security features to protect your content and protect user data.
Also, your chosen VOD platform influences the access you can grant your users. This includes passworded content, geoblocking or restricted download to protect premium content.
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FAQs
SVOD vs AVOD: Which Makes More Money?
SVOD and AVOD models are both profitably VOD service platforms with distinct monetization plans. However, SVOD model makes more money when compared to AVOD platforms because it has a recurring and consistent revenue stream.
What is the difference between SVOD and AVOD?
The key difference between SVOD and AVOD models is that SVOD allows users access premium content by paying a subscription fee. In contrast, AVOD allows users access video content freely in exchange for video ads.
How do SVOD platforms make money?
SVOD platforms make their money from subscription fees. These fees are made frequently at stipulated time like monthly, quarterly or annually.
What is AVOD monetization?
AVOD monetization refers to revenue generation gotten through ads displayed. These platforms make their money based on the number views or click a displayed ads gain over a stipulated time.
What are the disadvantages of AVOD?
While AVOD offers free access to video content, it comes with some disadvantages, this includes ad display during content streaming which can disrupt smooth views. Also, content viewed is usually of low quality and may be restricted to general content.
Final Thoughts on SVOD vs AVOD
SVOD vs AVOD are both profitable VOD platforms you can leverage as there are approximately 1.8 billion subscriptions to video streaming services.
However, SVOD pl;atforms make more money compared to AVOD. This is because it has a predictable stable revenue stream through subscription.
But, you must be willing to invest in building a large subscriber base who are committed to keep renewing their plans. Also, keep your content library up-to-date to attract new subscribers and retain old ones.
Most importantly, to build a profitable SVOD platform, opt for Adilo service provider that offers you secured and unlimited video hosting and many more.
Experience: Happiness Hassan is an SEO content writer and strategist with over 7 years of experience helping brands boost visibility, engagement, and sales.
Expertise: Whether it's keyword research, crafting content, or fine-tuning on-page and off-page strategies, I’ve got you covered. My goal is beyond driving traffic but making your users experience a win-win for everyone!
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When I’m not geeking out over SEO, you’ll find me deep in the world of self-development. As a dedicated student of continuous growth, I write about my growth journey, sharing insights to help others unlock their potential.
Education: Complementing my BSc. Geography and Environmental Management from the prestigious Ahmadu Bello University, Zaria, I have honed my skills as an SEO content writer and strategist through comprehensive training at Northpad, where I gained expertise in crafting optimized content to boost search engine visibility. As a certified student of Jobberman Soft Skills Training, I developed strong communication and problem-solving skills, which complement my SEO proficiency.
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