Video streaming services have a variety of revenue models.
Since around 2020, various video distribution services have been born, and the way these video distribution services generate revenue varies depending on the service.
A typical revenue model for a video distribution service is one in which there is a “paid plan,” and if you subscribe to the “paid plan,” you can view video content .
In other words, users can watch videos by subscribing to a paid plan.
There are many services that have adopted the revenue model of video distribution services, such as “you can’t watch videos without subscribing,” but many of these services will have difficulty growing, especially after 2023. This is the reality.
In this article, we will discuss why services that adopt a revenue model of “you can’t watch videos without subscribing” are not growing. On the other hand, there are services that continue to grow, and I will explain the new revenue models that these growing services are adopting .
At Jepista , we have been involved in the development and launch of over 50 video distribution services.
Of course, Jepista has been closely monitoring the video distribution service industry for many years and continues to analyze the industry.
This content is useful for those who are planning to create a video distribution service.
This is a short article. Please read to the end.
- What is the “optimal revenue model” for video distribution services | 2023
- Why "allow even free members to watch videos"?
- What is the model of “allowing free members to watch videos”?
- Why is the “model that allows free members to watch videos” growing?
- Can provide free members with a solution that eliminates their “inconvenience”｜Advantage 1
- Significantly reduce advertising costs｜Advantage 2
- Capable of capturing users’ stay time｜Advantage ③
- How to develop video-on-demand(video steaming) app?
What is the “optimal revenue model” for video distribution services | 2023
Since around 2020, many video distribution services have been born, and a popular revenue model is that “you can’t watch videos without subscribing.”
However, after 2023, this model of “you can’t watch videos unless you subscribe” has become an old model.
The “optimal revenue model” for video distribution services after 2023 is one that limits functions such as “change playback speed,” “skip ads,” and “fast forward,” but allows anyone to watch the video itself for free . That’s what it means.
In other words, users can watch the video content itself without paying money.
However, you cannot use functions such as “change playback speed,” “skip ads,” and “fast forward,” and if you want to use these functions, you need to subscribe to a paid plan.
Why “allow even free members to watch videos”?
In recent years, many video distribution services have existed, and many new services have also been born.
Major video distribution services include U-Next, TVer, Prime Video, and Netflix, as well as social media video distribution platforms such as YouTube and TikTok.
Furthermore, many video distribution services are being created one after another in more macro-layers such as various neighborhoods and industries.
In this way, the reasons behind the birth of many video distribution services are: (1) “online” has become popular during the coronavirus pandemic, and (2) the hurdles for creating a video distribution service have lowered.
For example, Jepista provides development services such as developing a video distribution service, implementing a subscription function, and even turning it into an iOS/Android application .
What is happening in this situation is that many video distribution services have been created, and competition for users is intensifying .
In other words, in addition to YouTube, TikTok, TVer, Netflix, and U-Next, new video distribution services are competing for users’ time .
Furthermore, on video distribution platforms such as YouTube and TikTok, creators continue to publish high-quality paid content.
Of course, users can view these contents for free.
In other words, you can watch useful videos on YouTube etc. without having to go through the trouble of subscribing to a paid plan of a video distribution service .
In 2023, when competition for users’ time is intensifying, the very act of “subscribing to a paid plan and watching videos” has become a high hurdle for users.
Video distribution services that have realized these realities have shifted to “allowing even free members to watch videos” and are growing their services.
In the following, we will explain the ideal model of “allowing even free members to watch videos” and why a “model that allows free members to watch videos” will grow. Let’s talk about that.
What is the model of “allowing free members to watch videos”?
In video distribution services that allow users to watch video content even if they are free users who have not paid, monetization is different from video distribution services in which videos cannot be viewed without a subscription. A method is required.
In this “model that allows even free members to watch videos,’ ‘ even free members can watch videos, but they can change the playback speed, skip ads, This will put restrictions on functions such as “Fast Forward.”
In other words, even free users who have not purchased a plan can enjoy the video content, but at the same time, we intentionally make some features unavailable, giving free users a certain amount of inconvenience. ” .
Why is the “model that allows free members to watch videos” growing?
Why allow users to watch videos for free even if they haven’t paid?
The answer to this question is that in the situation of the video distribution service industry after 2023, this “model that allows even free members to watch videos” has great advantages .
Next, I will explain three advantages.
Can provide free members with a solution that eliminates their “inconvenience”｜Advantage 1
For users who have become accustomed to “watching videos at 2x speed” on a daily basis, remaining a free user can be stressful because they cannot “change the playback speed.”
In other words, it is inconvenient for the user.
If a user wants to freely change the playback speed, they can eliminate this inconvenience by subscribing to a paid plan.
In other words, the user will be happy with this.
On the other hand, in the “model that allows free members to watch videos”, in some cases it is possible to include “advertisement videos” within the video.
If the video distribution service has a sponsor, you can include a “sponsored video,” or if you don’t have a sponsor, you can include a “video introducing your company’s products.”
By including “advertisement videos” in videos, free users can create a user experience where they can watch the video, but sometimes an ad video plays within the video.
If you are a free member and feel stressed by advertisement videos playing while watching a video, you can subscribe to a paid plan to use functions such as “ad skip” and “fast forward.” You can eliminate the inconvenience.
In the “model that allows free members to watch videos,” they create an advantage for paid plans by intentionally creating a structure that compensates free members for the “inconvenience” they feel .
This means that the service provides a solution for a fee to eliminate this “inconvenience.”
Significantly reduce advertising costs｜Advantage 2
One of the benefits of the “model that allows free members to watch videos” is that advertising costs can be significantly reduced.
This benefit of “significantly reducing advertising costs” is a “medium-to-long-term” benefit, so the longer you continue using the service, the greater the benefit will be.
In the model where you cannot watch videos without subscribing, it is difficult to acquire users without advertising.
In other words, in the model where you cannot watch videos without subscribing, users will not come to the service in the first place unless you use advertisements such as Google ads and YouTube ads.
It is very dangerous if you have a naive idea that you only need to run advertisements at the beginning of the service launch.
This is because it is common sense that users only come to the service during the period when advertising is running.
In other words, if you stop advertising, users will not know about the existence of your service.
Also, just because you use advertising, it doesn’t necessarily mean that users will subscribe.
If you are an influencer, it is very dangerous to think shallowly, “I have millions of followers on YouTube, Twitter, etc., so if I let them know there, they will subscribe.”
To date, Jepista has been involved in the launch of over 50 video distribution services.
Some of Gepista’s customers have “hundreds of thousands of YouTube subscribers,” but even for those with such a large number of followers, “acquiring paid members” is extremely difficult.
Therefore, it would be overwhelmingly cheaper to create a model that allows free members to watch videos and acquire free users first.
When launching a new service, it’s not just video distribution services that requires a significant cost to figure out how to get people to know about the service .
Capable of capturing users’ stay time｜Advantage ③
As you can imagine,
let’s say you go to a certain video distribution service and try to watch a video.
When I went to the “video page,” I saw a message saying “To watch this video, please subscribe to a plan.”
In this case, you will almost certainly leave this page.
In other words, “I give up watching videos.”
On the other hand, suppose you go to “some other video distribution service” and try to “watch a video.”
I went to the “video page” and was able to watch the video smoothly.
In this case, you are satisfied with watching the video, and you become interested in “other content” and “the service itself,” asking, “What other videos are there?”
The next day, in your free time, you will probably come back to this site, search for videos, and watch them.
As shown in the two examples above, the latter model, which allows free members to watch videos, is overwhelmingly more successful in acquiring users and user time.
How to develop video-on-demand(video steaming) app?
At Jepista , for those who are creating a “video distribution service/membership service” from now on,
We provide information that you should know in advance from an expert’s perspective.
For example , about “development services that can create video distribution services and membership services” ,
The article also covers “video distribution services and membership services launched by famous influencers.”
In other words, we are familiar with “video distribution service membership”,
And, “ We are disseminating information that only Jepista, which specializes in developing video distribution services and memberships, can do .”
Jepista is a development company that specializes in the development of video distribution services and membership services .
The “development service” provided by Jepista is called Jepista Prime .
At Jepista Prime,
In addition to “building a service,”
“How can you grow your service?”
Until that point,
As a “developer” and as an “expert”
Utilizing our knowledge and experience,
We strive to grow our services together with our customers.
Video distribution services and memberships are
“What kind of service do you want?”
“What kind of content do you want to distribute?”
Depending on these points, the form of service varies from person to person.
As someone who has actually developed video distribution services and membership services,
We strive to provide the best form of service that suits each individual case .
In addition, when developing services with Jepista Prime,
You can also turn your “video distribution service or membership service” into a completely unique branded “app.”
On the other hand,
Recently, in addition to Jepista Prime , many other “development services” that can create “video distribution services and membership services” have been created.
As a result,
The reality is that ” selecting the appropriate development service ” is becoming difficult.
In the field of “service development”,
People who cannot get enough correct information,
For reasons such as “It somehow looks good!”
For that person,
I chose an inappropriate “development service”,
As a result, we run into trouble after releasing the service .
There is no end to such cases.
The “development service” you selected is
The form of service you imagine,
If it cannot be achieved in the first place,
Naturally, we may not be able to provide the service you expected.
Then, when we reached the growth phase of “increasing the number of users” ,
Indispensable for increasing users,
Regarding measures such as “improving services” and “improving user experience”
It will be difficult.
From an expert standpoint, I would like to ask you,
first,
① “What kind of service do you want?”
Thank you for embodying the form of the service.
② Say something like, “In the future, we will increase the number of paid members to 10,000.”
We would like you to set a goal for your service .
On top of that, among the many “development services”,
Thinking about which development service would be able to realize the form of the service you are imagining .
Please check carefully.
That being said,
“Which development service and developer is really good?”
“Even if I’m told to materialize the service, I don’t know how to materialize it!”
“Even if I’m told to set goals, I don’t know what standards to use!”
It may seem like this.
If you are having trouble like this,
Please feel free to contact us.
Even if you don’t have any knowledge about development,
For development services and developers,
1. How much will they work with you to think not only about “creating” but also about the “growth” of your service?
2. How much do you treat it as a personal matter?
This is something you can feel regardless of your knowledge.
In the case of a “salesperson” who is a sales professional,
Regarding your “worries and anxieties”,
“I empathize with you! I understand!”
Like,
They will probably act as if they are dealing with it as if it were their own problem .
for example,
“I’m worried about how to attract customers!”
Things like
Let’s say you want to tell a “salesperson” of a certain “development service.”
At this time, the “salesperson” simply said,
“I empathize with you! I understand!”
If you answer,
The correct answer is not to choose that development service .
because,
For your concerns about “attracting customers”,
This is because it does not indicate any specific measures .
These “salespeople”
They appear to have “empathy”,
However, the ulterior motive of “I want you to sign a contract” is obvious.
Once you have decided on a “development service/developer”,
You will have to work with that vendor until the service is no longer available.
To avoid failure,
In order to avoid making the wrong choice,
If you are thinking “I want to create a service from now on!”,
Be sure to carefully select a vendor,
Please be careful.
Below are articles for your reference.
- A service that develops “
video distribution services/memberships” | Jepista Prime A development service that creates “membership services that distribute videos” such as Netflix, U-Next, D Lab, Konojuku ISM, and GLOBIS Hohohodai | Compatible with iOS and Android apps
- Carefully selected services that allow you to create your own video distribution service/membership [Thorough comparison of 6 companies]
We have a “6 company comparison table” of development services, so you can easily find out “which service is better!”
- Why did mentalist DaiGo create his own video distribution service “D Lab”?
A thorough explanation of the background, development costs, and sales of D Lab, which was created by DaiGo, who has 2.2 million subscribers to his YouTube channel.
- What is GASYLE? – About the salon created by Mr. Garthy.
Explaining the membership service that distributes videos launched by Mr. Yoshikazu Higashitani, also known as Garthy. | Explaining the history of creating the service, profits, sales, and server costs | Service will end in April 2023
- What are the disadvantages of YouTube membership?
Explanation of the reasons why it’s a bad idea to use YouTube membership and why you can’t maximize monetization in the first place.
- Beware of affiliates!
There are many sites, blogs, and YouTube videos that introduce “development services” that can create “video distribution services and membership services,” but these are often “affiliates who receive money.” So be careful!
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This reason, there are the sentences you may not understand.
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