The OTT industry has evolved drastically in the last few years. While the number of OTT subscribers grew exponentially over the past decade, the outbreak of the pandemic has further aided in its growing demand. As stated in a report by Statista, the OTT video segment itself is set to reach US$ 271,837 Million by 2025 globally. Do you know, this is resulting in a significant shift in the billing system? Almost all the OTT platforms have already adopted automated billing systems, and it is gaining more popularity with every passing day.
But, what’s the reason behind it? The first and foremost reason is, automating the entire billing process, but that’s not it! To know why automated billing systems are getting widely adopted, you must know the role of automated billing in OTT platforms. Let’s start!
Managing Various Subscriptions
We all know that an automated billing system automates the billing process including timely billing the customers, generating invoices etc. But not only this, it is excellent in managing various subscription models for the wide customer base. And this is one of the main reasons why the OTT platforms are inclined towards automated billing systems. Let’s give an example- A, B, and C are the customers of an OTT channel and they are subscribed to basic, premium, and ultra prime plans respectively. A decides to upgrade from basic to premium, B decides to downgrade from premium to basic, and C decides to downgrade from ultra prime to basic. Sounds confusing?
Imagine, how the real-time scenario will be, when the number of customers are much more than three? An automated billing system exactly takes care of these things, by managing multiple subscription models and respective recurring billing for various customers without any error. As the OTT platforms revolve around its subscription models, no wonder they are embracing automated billing systems more than ever!
According to the Manifesto Growth Architects, 70% of the businesses believe that subscription models are the keys to growth. And OTT platforms are no exception!
Intelligent Billing Solutions
In this era of Artificial Intelligence (AI), the OTT sector is more interested in smart billing solutions instead of the conventional ones. Billing itself is a time consuming process- the smarter, the better. Some of the highlights of an intelligent automated billing system-
- Supports one-time as well as recurring billing
- Hassle-free event-based billing
- Fast authentication for billing using social media accounts
- Manages promotional discounts, coupons etc. and automatically applies the same to the eligible customers
- Can support bundle subscriptions, where a customer can subscribe to multiple OTT channels through a single subscription plan
- Offers flexibility to let the OTT channels partner with other platforms and change subscription models accordingly
The latest survey by the Parks Associates revealed that 61% of the U.S. broadband households are subscribed to two or more OTT services as of 2020, up from 48% in 2019. The report also indicates that the streaming industry is projected to get more dynamic with the rise in OTT bundling plans. And an automated billing platform can smoothly handle such plans.
Also Read: What Automated Billing System Really Means?
The OTT industry is highly competitive. With the leading players like Netflix, Hulu, Spotify, Roku, and Amazon Prime, to name a few, getting stronger in all terms and new platforms striving to get in the positions, the competition is getting even fiercer. And the billing system of an OTT store has a lot of scope to help in this. An automated billing platform gives detailed insights and analytics about the important parameters- new subscriptions, recurrent revenues, revenue leakages, upgrading or downgrading, 360 degree customer view, etc. by generating ad hoc and user-centric reports. This is highly important to improve the existing subscription models or optimize the pricing plans.
The CEO of Netflix Reed Hastings revealed that in the initial days, data analytics helped substantially for its growth. And analytical reports related to subscription models hold a major part of it.
Suitable for Wide Demographics
Most of the OTT platforms have audience from diverse demographics, and it is important for the billing system to be cooperative enough to support-
- Multiple Languages
- Multiple Currencies
- Multiple Payment Options
- Multiple Payment Gateways
- Global taxation
A good automated billing system provides all these facilities to a OTT Platform making it suitable for the audience across the geographies.
Netflix provides its customers with more than 30 language options and its billing system supports the same.
Fast & Secure Payment Processing
What can repulse the subscribers of a OTT store? Payment failures and lack of security definitely rank near the top of the list. The OTT leaders are not ready to take a chance and that gives another reason to go for an automated billing system which ensures the customers get seamless and secure transaction experience by providing a PCI compliant platform and offering multiple payment options as well as gateways.
A latest report by Statista stated that there were around 2.83 Million payment card fraud cases in the U.S. in 2020. As the online customers are getting more concerned, OTT Platforms are adopting robust safety for online payments.
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