Gone are the days when you had to rush home to catch your favorite TV shows. All thanks to VOD streaming.
What is VOD streaming? It is a way to deliver video content over the internet using cloud technology. That way, you can enjoy entertainment whenever it suits you, and no more hassle of storing your movies on hard drives or DVDs, too.
If you’re a streamer, this is your chance to shine and share your awesome content. VOD online is incredibly powerful and has even caused a decline in TV viewership. In fact, up to 90% of younger viewers prefer VOD streaming services!
Are you excited to dive into the world of VOD streaming? Let’s start by exploring how it works and weighing its pros and cons!
What is VOD Streaming?
VOD stands for video-on-demand. VOD streaming is a process of delivering video content over the internet by allowing audiences to watch content whenever they want.
Unlike traditional broadcasting, VOD streaming offers flexibility. As a viewer, you are free to enjoy your favorite series, movies, and other video content at any time. You can even choose many VOD streaming services, from Max and Hulu to YouTube and Twitch.
When it comes to video-on-demand streaming, you don’t need to worry about storing the content yourself. The platforms will take care of the content on their servers, accessible through an internet connection.
Do you want to use your wired fiber connection at home, or a 4G connection to access the content on the go? Feel free to do that.
Streaming technology is so great that you can enjoy video content on any compatible device. Whether on your desktop, mobile phone, Apple TV, or Android TV, you can watch how awesome Manifest: Season 4 on Netflix is.
With all the convenience that video-on-demand streaming provides, it’s no surprise that watching online videos has become one of the main reasons people use the internet.
“But, is it considered VOD streaming when I watch my favorite highest-paid Twitch streamers in action?” Well, if you’re watching them in real-time, it’s actually a live stream, not a VOD stream.
VOD vs. Live Streaming: What’s the Difference?
Here are the differences between VOD streaming and live streaming:
1. Content Creation
When it comes to VOD streaming, there’s always a post-production process involved. It ensures the content is perfect for online audiences to enjoy. Whether you’re a professional streamer offering free online courses or a filmmaker creating content for Disney+ to attract paid viewers, this process is essential.
On the other hand, live streaming can bring some surprises. It’s spontaneous, so don’t be shocked if you come across bloopers or poor sound quality out of the blue. No matter how much the streamer prepares for a smooth live stream, unexpected things can happen.
2. How the Content is Presented
VOD streaming is all about pre-recorded content. As a viewer, you can rewind if you miss something or fast-forward through the boring parts. If you are the content creator, you have the chance to edit your videos and make them awesome before sharing.
But, in live streaming, it all happens in real-time. As said earlier, the streamer has no time for editing. Sometimes there are even technical hiccups that will make their content less perfect. Believe it or not, that’s what makes live streams unique and captivating.
3. How the Content is Distributed
In VOD streaming, the content is delivered to viewers whenever they request it. Since it’s prerecorded, you can enjoy the full video content completely as an audience. It’s like picking a book from a library and reading through the pages as you please. You have the freedom to pause, rewind, and fast-forward the video content as you like.
On the other hand, live streaming uses a different content distribution approach. The content is continuously transmitted from the streamer to the viewer in real time. It’s not a complete package when it is being broadcasted. That’s why a reliable internet connection on both ends is important to ensure the live stream runs smoothly.
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4. The Way to Access Content
In VOD streaming, the video is uploaded to the server as complete content that viewers can enjoy on-demand. As long as you have an internet connection, you can access the content from anywhere. It offers flexibility, allowing you to consume the content at your own pace.
On the other hand, live streaming has a sense of urgency. It’s like a prime-time TV show. You might miss out if you’re unavailable at the right time. While you can hope that the streamer records and uploads the stream as on-demand content, it’s not always a sure thing.
VOD streams can be engaging, but the interactions between the content creator and the audience don’t happen at the same time. Let’s say you watch videos on YouTube, you can leave comments, like, and share to express your thoughts and feelings about them. While it’s great, instant interactivity still needs to be added.
On the flip side, live streaming is all about real-time interaction. Imagine a gamer streaming gameplay on Twitch. Viewers can comment on their gameplay style or give lively reactions to show support. This way, the streamer can connect instantly with their audience and show their honest reactions.
6. How the Monetization Works
As a YouTuber, you can monetize your on-demand content through ads, sponsored content, and more on your YouTube channel. On the other hand, streaming platforms like Netflix or Amazon Prime Video use subscription fees or pay-per-view models to monetize their video content.
When it comes to live streams, different platforms might have distinct ways to monetize. Twitch, for example, allows gaming streamers to earn money through viewer subscriptions, donations, ad revenue, and sponsorships.
How Does VOD Streaming Work?
VOD streaming works by making your digital video content ready for internet transmission through encoding and then storing it on streaming servers. When a user requests a video, it’s streamed in small data packets to their devices.
Here’s a step-by-step breakdown of VOD online:
1. Encoding Raw Video
The first step is to encode the raw video you’ve captured with your camera. You can even use your best DSLR for streaming for a more professional look.
Why do you need to encode the video? Because the raw video format from any camera isn’t suitable for streaming. The encoding process will play its role in compressing the video file, making it fit for online data transmission.
The bigger the file, the more bandwidth you need, and it can take more time to access the data in its original file size. In short, it is not too efficient to stream without encoding.
Luckily, there are many video encoders you can use for this process. And if you’re using a platform like YouTube, they usually come with built-in streaming encoders to make things even easier.
2. Storing Video Data
Without uploading your video content to a server, how can your content be accessible online? So, the next step for VOD streaming to work is by storing the video data online.
When it comes to smaller-scale VOD content delivery, you can use your own streaming server for more control over your video storage and distribution. Alternatively, you can use streaming platforms like Twitch, which have reliable infrastructure. The uploading process on those platforms is easy, too.
However, for a business aiming to reach millions of viewers and offer paid content, robust servers to handle video storage and delivery are required. In fact, Netflix and Hulu have invested in powerful servers to meet the demands of their vast audience base.
3. User Request
Once the video data is stored on the server, the platform can present the content to viewers through a website or application.
It is like visiting a library and searching for a book you wish to read. So, whenever viewers choose a video they want to watch, a new screen will appear, allowing them to start playing the video.
Remember, as in the library, where you have to take a book to the checkout counter, you might need to sign up to enjoy content on video on demand platforms, or even pay for their subscription fees.
Also, the collections of video content available will vary depending on the platform that provides them.
Buffering is the process of delivering content which is typical of VOD streaming.
Even the video data is stored entirely on the server, when a viewer requests a video, the server doesn’t send the whole video file all at once. Instead, the video content is divided into smaller chunks. Then, it will be sent one by one.
Those chunks are temporarily stored in device memory and presented to the viewers in sequence one after another. This way, the VOD stream doesn’t take much time to start playing the video.
What’s more, there is an adaptive streaming technology comes to play. Basically, the technology will adjust the video quality based on the viewers’ internet connection.
It allows the system to manage the request of the video quality and store the relevant video data in the memory. In short, adaptive streaming helps prevent buffering delays.
5. Playing the VOD Online
Once the initial chunks of video data have been buffered on the viewer’s device, the playback begins and the video starts playing on the screen.
As a viewer, you can rewind and fast-forward depending on your pace to enjoy the video content. You can even stop, pause, and replay the content. Some platforms even remember your last watched position, allowing you to resume the video from where you left off.
Bear in mind that a compatible video player is vital for VOD streaming. If the player doesn’t support the video format, it won’t play at all. So, make sure to use a video player that works well with various formats.
VOD Streaming Monetization Models
Revenue from video on demand is expected to reach US$ 673.4 billion by 2031. If you don’t use that opportunity as a streamer, you’d be missing out.
Here are the video-on-demand streaming monetization models that you should know:
1. Subscription Video-On-Demand (SVOD)
In this VOD streaming monetization model, viewers pay a recurring fee to access the content, much like how magazines such as Time and National Geographic work with their printed versions. You typically have to pay them a monthly fee upfront.
Now, imagine you’re a vTuber who creates captivating visual content. You can set up an SVOD model where your fans pay a monthly fee to enjoy all your awesome videos.
This model ensures a reliable income stream and allows you to estimate your earnings based on your total number of subscribers. It’s an excellent choice for content creators who consistently produce fresh content.
However, keep in mind that this subscription-based approach for video-on-demand streaming may limit the size of your audience.
2. Transactional Video-On-Demand (TVOD)
As its name suggests, transactional VOD streaming follows a pricing model where viewers pay a one-time fee to access specific content. Yes, this is a pay-per-view model. It’s like buying a ticket to watch a Fast X movie at your local cinema.
Some viewers prefer this model as they see it as cheaper, compared to a subscription. They only have to pay for the content they want to watch without committing to a monthly fee. However, TVOD content prices are typically higher.
Content creators should understand that this monetization approach might not always work for their content. It works best for special content with high perceived value, such as documentaries or exclusive content.
Also, this approach can result in unpredictable revenue due to the limited viewership and payment on a per-content basis.
3. Ad-Supported Video-On-Demand (AVOD)
Everyone likes free content. So why don’t you let viewers access content for free? As a trade-off, you can include advertisements in the content. This model is like broadcast television.
Unlike SVOD and TVOD, your revenue will come from advertisers. This is the monetization model used on platforms like YouTube. You can share various types of videos, such as gameplay sessions of Fortnite, tutorials to help people learn new things, DIY projects, and more.
The more ads that appear during viewers’ enjoyment of your YouTube videos, and the longer viewers stay engaged, the greater potential revenue you can generate from your content.
This monetization option can be a good choice for creators with a large audience that attracts advertisers. However, it generally offers lower revenue compared to models that provide a seamless viewing experience without advertisements.
4. Hybrid Models
If you’re unsure which options to choose, you can try a hybrid model, combining all three into a single pricing model for your on-demand content.
The concept behind a hybrid model is to offer viewers the choice to pay a subscription fee for ad-free VOD streaming. This way, you generate revenue from your subscribers. For those who prefer free content, they can still enjoy your content with ads, allowing you to generate revenue through advertisements.
This monetization approach provides flexibility to serve different viewer preferences. But, managing a hybrid model can be complex.
5. Sponsorships and Partnerships
In this VOD streaming monetization model, you can establish specific partnerships with brands or platforms to generate revenue. These partnerships typically involve the sponsor providing financial support, products, or services in exchange for promotion.
Richard Tyler Blevins, a.k.a Ninja, is one of the highest-paid Twitch streamers who has adopted this monetization option. With his exceptional skills in Fortnite, he attracted brands seeking to reach his large and engaged audience.
In 2019, Ninja left Twitch and entered an exclusive partnership with Mixer.
More recently, another prominent Twitch streamer, xQc, signed a partnership contract with Kick, a streaming platform similar to Twitch, featuring a 95-5 revenue split. This showcases the promising potential of this monetization model for professional streamers.
The monetization model doesn’t always have to be directly tied to consuming your VOD streaming content. Selling merchandise related to your content can be a great way to generate revenue, too.
Big names like Disney and famous bands like Metalica and even Ninja himself have embraced this approach. They sell various products such as t-shirts, posters, tumblers, action figures, and more under their brand. Merchandising offers an effective way to earn revenue while strengthening brand identity.
Think of merchandising as an additional revenue stream that allows fans to support creators in a tangible way. However, bear in mind that merchandising may not be suitable for all types of content and viewers.
Pros and Cons of VOD Streaming
Every new technology comes with its own set of advantages and disadvantages, and VOD streaming is no exception. Let’s explore its pros and cons!
The Advantages of Video-on-Demand Streaming
Here are the advantages of offering video-on-demand content:
1. Video Content is Always Available to Watch
Let’s take a look at it from the audience’s perspective first. Imagine having the freedom to watch your favorite video content whenever you want, without any rush. You can focus on finishing your current tasks and catching up on the content later.
You heard that right! With video-on-demand streaming, you can watch content at your convenience. No more worrying about fixed schedules that force you to adjust your plans.
Want to catch up on a TV show during your commute? Sure, you can! Feel like having an epic weekend binge-watching session? Absolutely!
2. Up to 8K High-Quality Videos
As discussed earlier, Video-On-Demand (VOD) streaming involves editing to ensure high-quality content.
VOD platforms like YouTube offer resolutions up to 8K. This definitely surpasses the traditional cinematic experience. Watching a nature documentary on the platform reveals stunning details in animals’ fur and vibrant colors in landscapes.
VOD streams also deliver immersive audio with support for Dolby Digital or Dolby Atmos sound. This enhances the experience. Imagine if you’re watching a thriller movie and hearing the subtlest of sounds, it will heighten the suspense, making it more immersive.
3. Creators Take Charge of Their Content
Now, let’s take a look from the content creators’ perspective. The rise of VOD has transformed how they handle their content. They can choose the types of content they can create, how they promote it, and the platform they prefer.
This is all possible because VOD streaming provides a direct line of communication to their audience. In traditional broadcast models, content creators relied on intermediaries like TV networks for audience reach.
What’s even more amazing, content creators can enhance their creative process through direct feedback from their audience. Likes and shares serve as indicators, too. All of them can help creators understand what their audience enjoys best.
4. Reaching Global Audiences is a Breeze
Having a global reach is a huge advantage of VOD streaming. Content creators can easily share their work with people all around the world without any distribution obstacles.
You can simply sign up for platforms like Twitch and YouTube or create your own streaming server. Then, you can upload your content and make sure viewers worldwide can enjoy it.
With that said, there are no geographical boundaries or time zone restrictions. Viewers from the United States, Sweden, or anywhere can easily access the content.
What’s even more awesome, VOD platforms often provide subtitles in different languages and tailor content recommendations based on regional preferences. This makes the content more enjoyable for international audiences.
5. Direct Monetization Options
Another awesome thing about video-on-demand streaming is its wide range of monetization options. In this era of the creator economy, content creators are free to generate revenue from their content using strategies they believe will work best.
It’s not just for individual creators, but also for businesses that dive into the world of VOD streaming.
Take Netflix and Hulu, for instance. They primarily rely on subscription-based revenue models, aiming for long-term viewer engagement. On the flip side, vloggers might opt for ad-supported models, making their content free for viewers while earning money through advertisements.
The Disadvantages of VOD Streaming
When it comes to video-on-demand streaming, it’s not all sunshine and rainbows. There are some disadvantages you need to keep in mind, too.
1. Creating Consistent Content Can be Challenging
Let’s be honest, making consistent and engaging content is not an easy thing. Viewers have access to a vast array of content from creators all around the world. This means the competition for viewer attention is fierce, and the expectations are high.
If you fail to captivate your viewers with attention-grabbing content, it becomes challenging to stand out. Without fresh and creative ideas, innovative content formats, or unique insights, viewers can easily switch to other channels.
On top of that, maintaining consistency is vital. Audiences expect regular updates, and if you fall into idle mode due to certain reasons, your viewers may lose interest and seek out more captivating channels.
2. Relying Too Much on Internet Connectivity Quality
The nature of VOD streaming heavily relies on a stable internet connection, which poses challenges for both content creators and viewers.
As a viewer, your streaming experience is directly affected by the speed of your internet connection, whether a mobile network or a fixed home connection.
If you have a slow internet connection, you’ll never have the chance to enjoy high-quality 4K VOD content. You might also face buffering issues or even be unable to access the content at all if your connection is unstable.
As a content creator, while VOD allows you to reach a global audience, delivering content to countries with poor internet infrastructure can be challenging.
What’s more, ensuring that your streaming platform has robust servers and cutting-edge streaming technology is essential. This may come at a cost, such as using premium plans with features like simultaneous internet connections.
3. Managing Rights and Licensing
For VOD streaming services, piracy and copyright issues are of the utmost concern.
The digital nature of VOD content makes it vulnerable to unauthorized access, resulting in revenue loss for content creators and the platforms. For those who rely on creating content for a living, this can be devastating.
Piracy has been an ongoing issue since the days of Napster and continues to pose a challenge today. Users illegally bypass the need to pay for subscriptions. It can be frustrating when users find ways to illegally bypass subscription payments, undermining the value of your hard work.
What’s more, some streaming platforms may change their revenue-sharing policies. This can leave you with only a small portion as a creator. When this happens, regardless of your large fan base, you can lose significant revenue.
Things to Consider when Choosing VOD Streaming Services
Here are the things to consider when picking the video on demand streaming:
1. Content Library
The content library is all about the variety of video content available on a platform. The variety, quality, and exclusivity of content play a big role in viewer satisfaction. For example, if you’re a Marvel fan, you might prefer Disney+ due to its exclusive content.
As a content creator, it’s important to consider the diversity of a platform’s content library. Platforms with a wide range of genres tend to attract a larger audience, giving your content more potential viewership.
Alternatively, if you’re focused on gaming and want to attract a gaming streaming audience with VOD streaming, platforms like Twitch can be a great option.
The subscription cost plays a big role for many viewers when choosing a platform. Competitive pricing can be a major factor in signing up for specific platforms. That’s also why platforms like Disney+ offer bundles, making them look affordable with more value.
For content creators, it’s important to understand the platform’s pricing structure and how it impacts your revenue. Platforms that offer higher revenue shares or better monetization options should be your top pick.
3. Streaming Quality
High streaming quality enhances the viewer’s experience, making them more likely to stay on the platform. Platforms offering HD and 4K streaming are attractive, especially to viewers with high-speed internet and advanced viewing devices.
High streaming quality also benefits creators, ensuring their content is presented in the best possible light. This can enhance audience appreciation and engagement with their content. Pick any streaming platform that allows you to provide high-quality content to your viewers.
4. Device Compatibility
Keep in mind that viewers aren’t just sitting on their living room couch watching your content on TV. In reality, most internet traffic comes from mobile devices, which is how people consume VOD streaming content. With that in mind, a platform that supports a variety of devices is more favorable.
Device compatibility is also a game-changer for content creators. It expands the reach of your content and opens up more ways to connect with viewers. The more devices their content is compatible with, the wider your potential audience becomes, resulting in increased viewership and revenue.
5. Accessibility Features
For VOD streaming services, accessibility features can make a difference. If the platform provides subtitles, it can help viewers with hearing impairments. With these features, they can enjoy the content better.
For content creators, it’s essential to choose a platform that offers accessibility features for the same reasons. These features can expand the reach of their content, making it accessible to a more diverse audience.
6. Additional Features
Streaming platforms with advanced features are excellent. Just think about offline viewing, where you can download and enjoy content later without an internet connection. And let’s not forget multiple profiles on Netflix. That feature allows each family member to get personalized recommendations and have their own watchlists.
For creators, content analytics is a game-changer. It gives you valuable insights into viewership patterns and audience preferences. So, if a platform offers this feature, go for it! It will help you fine-tune your content and make it even better.
We’ve got your question covered, VOD streaming is all about accessing on-demand video content through the internet.
With VOD streaming, you can enjoy your favorite movies and series on any device. It’s a game-changer for viewers and especially for content creators. It provides flexibility to reach a global audience and generate revenue more effortlessly.
Of course, like anything else, VOD streaming has its pros and cons. We’ve covered that one, too. Now, let’s focus on creating your content and happy streaming!