As you are reading this blog, you are probably watching a funny cat video that just appeared on your Facebook feed. That’s VOD or Video-on-Demand. People are consuming on-demand video content every minute, even if they are unaware of the fact that it’s VOD!
According to Statista, the VOD market will cross US $182.40 billion in 2024! It will grow at a CAGR of 8.27% from 2024 to 2027. VOD user penetration will also grow from 38.3% in 2024 to 43.2% by 2027.
So, as the demand for video is on the rise, content creators and broadcasters will have infinite opportunities to thrive in this evolving industry. If you are one of them, this blog is for you! This blog will give you an in-depth idea of what is VOD, how it works, and how your business can benefit from it.
Ready to get on board the VOD ride? So, let’s get started!
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Video on Demand (VOD) is a system that lets you watch any form of pre-recorded video content. You can watch VOD movies and TV shows whenever you want. So, they don’t follow any fixed schedule like traditional TV. They are available 24×7 and you can watch them anytime.
In layman’s words, VOD is a way to consume video content of your choice from a giant repository at any time, anywhere, and on any device, according to your preferences. Any pre-recorded content on the internet that can be played at any given point in time is VOD.
Hence, VOD allows users to
Nowadays, you can find video on demand streaming anywhere! For example, a YouTube video on baking a raspberry cake, your favorite Netflix show, a product demo video on your company’s website, or a cute dog video on Facebook. All of them are VOD!
Netflix, Disney+, Amazon Prime Video, and Hulu are very common examples of video on demand streaming platforms! And all of them are growing rapidly!
Netflix is the most successful VOD platform globally. It has reportedly generated a revenue of US $9.3 billion in the first quarter of 2024.
Here’s a short snapshot of how VOD works-
It involves many technical aspects. Let’s take a brief look at them.
On-demand cideo content is stored on servers (often in data centers). They are controlled by the VOD service provider.
When a user wants to watch a video, their device sends a request to the VOD streaming services. This request specifies which video they want to watch.
The VOD server locates the requested video in its storage. The video is transmitted in chunks to the user’s device. Hence, the video playback begins almost immediately.
Many VOD streaming services nowadays use Content Delivery Networks for faster delivery of content. The content delivery network or CDN is a network of cloud servers spread across the globe. Hence, the content is delivered from the nearest located server. That is why, the viewers experience lag-free and buffer-free streaming, even in remote locations.
The users can watch the content as soon as the initial chunks of the video arrive from the server. They don’t need to wait and download the entire file beforehand. The streaming bitrate adjusts based on the user’s internet connection speed later on. This ensures smooth playback without compromising quality.
Users can control the playback experience. They can pause, rewind, fast-forward, and sometimes even download the content for offline viewing.
In 2024, on-demand video streaming can be used for practically anything! VOD is used for streaming video content for businesses across multiple domains and industries, like:
One particular question that often arises is ‘Is VOD the same as OTT?’ Well, OTT or Over the Top is a way of delivering media content. OTT content is delivered via the Internet without the intervention of traditional cable or satellite services.
VOD, on the other hand, is just a part of OTT. It is how the content is consumed by viewers. Any content that starts when you push the play button is VOD. For example, Netflix, YouTube, and Facebook Watch fall into the VOD category.
Hence, VOD and OTT (Over the Top) are related concepts. But there are subtle differences. As we discussed before, VOD allows users to access video content whenever they want to watch it. VOD content can be delivered online or via IPTV services.
But OTT refers to any form of video content that is delivered online. It can be on-demand, pre-scheduled, or even live!
So, while OTT refers to the content distribution model, VOD stands for the content consumption model.
The key differences between OTT and VOD include:
VOD and live streaming are two different methods of delivering video content, each with distinct characteristics. Let’s compare them based on different parameters.
VOD vs Live Streaming | ||
Parameters | VOD | Live Streaming |
Nature of Content | VOD allows users to access pre-recorded videos or movies at any time they choose. | Live streaming involves broadcasting real-time video and audio over the internet as the event happens. |
Playback Control | Users can start, stop, pause, rewind, and fast-forward the content as they wish. | Viewers watch the content as it unfolds. Many times the users cannot pause or rewind the live videos. But nowadays many platforms do support DVR. |
Content Availability | Content is stored on servers and accessed on demand. | The content is delivered instantly and simultaneously to viewers who are tuned in at that moment. |
At the end of the day, VOD provides flexibility and control over when and how viewers consume content. On the other hand, live streaming offers immediate and real-time streaming of ongoing events.
Content or video monetization is earning money from the videos you publish. When you publish an original video on your streaming website, your customers can get access to the content in four ways:
In the case of free content, you won’t be earning anything from your videos. So, to monetize your videos, you have three options:
If you are enabling any one of the above three, you can earn revenue whenever your audience views or downloads your content. Let’s discuss more of these content monetization models in the next paragraphs.
Learn more: Video Monetization Options – What to Choose?
You can use several monetization models to boost your VOD revenues. The three main monetization models of VOD are – SVOD, TVOD, and AVOD. And a new revenue model, HVOD has become popular in recent years. Let’s take a sneak peek:
SVOD or subscription VOD is the most widely used content monetization model for VOD services. With this revenue model, viewers have the choice to pay a monthly subscription to get access to an exclusive content library. By paying the fee, they get freedom from advertising video. Ad-free viewing combined with quality content makes SVOD a popular choice amongst users.
Streaming giant Netflix has championed the SVOD model by providing users the ability to upgrade from Basic > Standard > Premium to unlock access to exclusive content and features.
AVOD is a content monetization model that generates revenue by placing ads in the video. Advertisements can be displayed as pre-roll, mid-roll, or post-roll and can be skippable or non-skippable. VOD platforms using this model entail customers watching the video for free in return for watching ads in between.
For example, YouTube uses the AVOD model where viewers get free access to watch ad-supported video content.
TVOD or Transactional Video on Demand lets customers pay for a particular video they want to watch as opposed to paying a recurring monthly fee for getting access to a whole content library as in the case of SVODs. This revenue model enables users to make a one-time purchase to savor exclusive content.
HVOD or Hybrid Video on Demand is a relatively new VOD monetization model. But it is creating a lot of buzz in 2024. When a VOD service uses two or more of the above-discussed revenue models together, it is called HVOD.
For example, suppose a streaming platform launches a new subscription plan, which is relatively cheaper than the previous plans. And to make up for the revenue lost, they insert ads into content. Hence, they are combining SVOD and AVOD to deliver a budget-friendly, yet profitable plan. Hence, it increases both subscribers and revenue. This is a classic example of HVOD.
Click here to know more about the differences between HVOD and SVOD, and which is better.
So, what exclusive features do you need to create a stunning VOD streaming platform? Well, although free VOD platforms like YouTube help you monetize your content, you would require a professional online video platform to help promote your brand name, monetize your VOD content, and secure it to prevent piracy.
Popular B2C video hosting platforms and social media often fail to meet the standards of professional broadcasters dealing with a high volume of media assets. Most importantly, these B2C platforms are not secure enough. And they allow you to add your own logo, or customize your video player as per your brand needs.
That is why, Enterprises need business-grade VOD platforms to grow their brand. Platforms like Muvi One provide an end-to-end OTT streaming solution to businesses of such kind.
Using a White label VOD platform enables you to use your logo, brand colors, etc that reflect your brand persona. A VOD platform should be able to build a brand name for itself and this is where free video hosting sites like YouTube fail to cut the mustard for most content creators.
Content security is of vital importance for content creators and is one of the primary reasons for choosing a professional video streaming service as opposed to free video hosting platforms like YouTube. User authentication, data encryption, watermarking, and digital rights management (DRM) are important video security capabilities to look for in a VOD provider.
Adaptive bitrate streaming adjusts video quality based on internet speed for smooth playback. It switches between different bitrate versions in real time to ensure an optimal viewing experience without buffering. Streaming platforms like Netflix and YouTube widely use this feature. ABR-enabled video streaming is extremely crucial for smooth video playback. So make sure your streaming service provider supports ABR technology.
Encoding and transcoding compress and decompress your video into variable bitrates, formats, and encoding profiles for smooth playback on various devices. We recommend looking for a solution that has cloud video transcoding capabilities for VOD content to reach users with different screens and varying internet speeds without any hassles.
If your VOD platform boasts an exclusive content library, you will want to reach out to your customers in every corner of the world. And that is only possible through a fast and reliable CDN or content delivery network. So, multi CDN-enabled VOD service provider adds a layer of reliability as it allows caching of your content to the most optimal server located closest to the user requesting it. The result – lower latency and faster delivery of your content.
Make sure you choose a VOD streaming service that enables multiple monetization models including subscriptions, ad-based, PPV, or a hybrid model as per your business requirements.
If you want to launch your own on-demand streaming service like Netflix, then this is the perfect time. The process has now become quite easier, with a lot of quality no-code VOD platforms. We have already briefly talked about Muvi One, and there are many more, like Dacast, Brightcove, Vimeo, and Wowza. Let’s take a sneak peek at the top 5 VOD Platforms in 2024.
Muvi One is a fully customizable no-code VOD platform, known for its extensive security features, advanced branding and customization options, and multiple monetization options. It caters to businesses of all sizes with comprehensive OTT solutions. It offers over 500 features out-of-the-box, including built-in CDN, DRM, and payment gateway support.
Pricing can be on the higher side.
Dacast offers a user-friendly interface combined with some advanced features. It is good for organizations looking for reliable VOD platforms.
Brightcove is a scalable platform known for its global reach, integration capabilities, and robust analytics tools for optimizing video performance.
Vimeo is known for its high-quality video streaming and creative community support, offering intuitive tools for video creation, editing, and monetization.
Wowza provides flexibility with customizable APIs and support for both live streaming and VOD. Hence, it is suitable for diverse streaming needs from small setups to large-scale deployments.
VOD makes content accessible anywhere and on any device. Hence, it truly enables a better user experience for customers, therefore transforming from a ‘can have’ to a ‘must-have’ feature for a wide range of industries and use cases.
Muvi One is a highly reliable and feature-rich end-to-end OTT platform provider that can add video capabilities to your business. Muvi One’s fully managed online video platform offers both Video on Demand (VOD) and Live Streaming solutions empowering you to launch your white label multi-device VOD platform, instantly!
Are you ready to explore how optimized and user-friendly Muvi’s feature-rich VOD platform is? Check it out yourself by taking a 14-day Free trial!
Also Read:
👉 How to Sell Premium VOD Content?
👉 How to Start A Successful VOD Business?
VOD stands for Video on Demand. It refers to a streaming service or feature that allows users to select and watch video content whenever they choose. The viewers don’t need to wait for a scheduled broadcast time. Examples include Netflix, Amazon Prime Video, and Hulu, where users can stream movies, TV shows, and other media on-demand over the internet.
VOD services can be both free and paid, depending on the platform and content provider. Some platforms like YouTube offer a selection of free content supported by ads. While others like Netflix require a subscription fee to access their full library of content without ads.
Yes, Netflix, Amazon Prime Video, and Hulu are prime examples of VOD.
Written by: Sreejata Basu
Sreejata is the Manager for Muvi’s Content Marketing unit. She is a passionate writer with a background in English Literature and music. By week Sreejata spends her time in the corporate world of Muvi, but on weekends she likes to take short hiking trips, watch movies and read interesting travelogues.
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