Modern television and internet services in different countries offer a wide range of choices as far as providing and paying for video content. Given that those choices could be mutually complementary as well as mutually exclusive, it's easy enough to get lost between the terms and abbreviations like SVOD, AVOD, TVOD. In this article we'll take a look at the characteristic features of each of those models and the differences between them. For convenience, we structured them in three classes: 1. Type of media 2. Method of payment 3. Technology of delivery
To navigate let's take a look at the diagram:
Level 1. Media
The first split is a separation between traditional television and Internet platforms. Strictly speaking, the term VOD (Video On Demand) includes all types of services we're covering here. The acronym VOD is often not used entirely correct, when it is used in the context of ordering video over traditional cable TV. In it's turn OTT (Over The Top) is used as an umbrella term for all the models of video delivery via Internet, that don't require a cable/satellite TV-connection.
VOD (correct use)– all types of access to specific video content VOD (common use) – systems for ordering specific video through a cable TV network OTT – systems for ordering specific video via the Internet (including both payed for and nominally free, see below)
Level 2. Payment method
Because OTT platforms are more modern and flexible, they allow for a number of different principles and their combinations. On the other hand payment options for VOD inside cable TV are usually conservative and are tied to the operator's tariff rates.
SVOD (Subscription VOD) is the most "traditional" model: the viewer buys a monthly subscription and for that time period gets full access to the whole providers media library. Therefore the main criteria for SVOD network will be the richness and diversity of content. Without any doubt, the best known example of a SVOD service these days is Netflix.
TVOD (Transactional Video On Demand) might be the easiest to understand as a digitalized version of regular old fashioned act of buying media on physical carriers. That place that was occupied by getting the VHS tapes back in the 90's and DVD's in the 2000's is now taken by the TVOD services, which offer the advantage of simple convenience: not having to go to a store but rather getting what you want instantly, literally off of one's couch. A relative plus of this model compared to SVOD is the fact that you keep your access to once bought content and don't lose it when the subscription is over. Another flavor of TVOD is based on mostly North American traditional system of Pay-per-View events, that came from the old television days and is still used mostly for broadcasting large sports, like Super Bowl finals.
AVOD (Ads-Supported VOD) - "payment free" model for watching video, which is to say that the currency you're paying with is an alternative one: instead of hard cash here it's what they call attention dollars, the time you spend watching ads. Obviously, an undisputed leader here is everyone's favorite friend YouTube. Although, in later years they've started to experiment with a combination of all three models. While AVOD remains the main way for monetizing all the amateur and semi-professional user generated content, YouTubeRed offers access to exclusive titles under subscription, and apart from that, both classics and new releases of A-movie scene are sold on a transactional base. This kind of mixed model appears potentially the most beneficial, but also the most demanding in terms of resources, which makes it feasible only for the market giants.
SVOD – access to a media library via subscription, e.g. Netflix TVOD — separate transactions on each specific title (movies, broadcasts), e.g. iTunes AVOD – watching the content after advertising pre-rolls, e.g. YouTube
Level 3. Delivery technology
Last level has to do with physical method for content delivery. For cable TV the main way is still a traditional plug-in for TV sets through provider's branded hardware. But even they try to keep up with the times and recently start to offer to their customers more and more options for watching on different devices through mobile applications. OTT platforms in their turn put effort into expanding this trend even further, trying to incorporate any and every type of device that has a possibility of Internet connection. This includes not just tabletop PC and mobile gadgets but also modern TV sets and even gaming consoles.
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