The OTT industry had been on the rise before the COVID-19 pandemic, and it skyrocketed even more during it. The OTT industry players saw an opportunity for growth – people were stuck at homes, and theaters and cinemas were shut. This is where Netflix, Disney+, and others entered people’s houses.
The pandemic seems to be over, but the OTT players are still on the rise. Moreover, Fortune Business Insights predicts that the OTT market will reach $139,00 billion in 2028 at a CAGR of 17,7% during the forecast period. The OTT service providers will focus on monetizing their content. Then, how will monetization transform the media and entertainment industry?
From broadcasting to OTT
Years ago, we would wait in front of the TV for the other part of the series to air. We would wait for weeks or even months for the next episode with an outcome of the plot.
Nowadays, it is much simpler. You just enter the OTT platform and view the next episode whenever you want. You can watch one part or binge-watch the whole season. You don’t have to wait.
That’s why people turn to OTT memberships. They like content suggestions from the streaming service as a part of OTT video personalization system. They want access to unlimited amounts of content available at any time. They pay for subscriptions or single episodes, which is beneficial for whom? The media and entertainment industry benefits a lot when opting for airing their content on OTT platforms.
So, how do OTT platforms make money?
The first thing people look for on OTT platforms is content. That’s why OTT platform providers need to invest a lot of money in it. But how do they generate revenue?
OTT platforms generate money by charging fees from their subscribers and providing them unlimited access to content in exchange. These platforms operate on a subscription-based model. Other providers prefer to charge a fee for every video they have on their platform. Also, some platforms use an advertising-based model to earn money. The advertisers who want to display their ads on OTT platforms pay a fortune for that to them.
The influence of OTT on the Media and Entertainment market
In the beginning, OTT wasn’t as popular and widespread as it is now. It was only for tech-savvy people who enjoyed OTT capabilities. Moreover, the majority of the content was in English, and the non-English population couldn’t use these platforms.
When more people dived into the OTT world, the OTT players, such as Netflix and Hotstar, began creating their original content. Many videos were in regional languages. For example, TVALB provides its users with Albanian TV and other Albanian content (tv shqip). The OTT platform adoption increased when more people obtained smartphones and other devices with access to the Internet.
What is more, not only adults appreciate OTT platforms. Today, even children have their favorite movies and series released on OTT platforms. They are huge fans of OTT memberships, too.
The other side of the media and entertainment industry has also experienced changes. New artists who get tired of waiting for their lucky day on screens can express themselves by creating OTT content. And they find their fans!
Don’t these points show that OTT is in great demand?
OTT platforms create a win-win situation for everyone. OTT monetization will influence not only producers and actors but also content creators. The more the number of subscribers, the more money the OTT platforms receive, and the more and better content they can create.
What is more, theaters and TV won’t fade away. So, producers and actors will always have a chance to release on big screens.