Exploring the Ideal Mix of Video-on-Demand Service Models

The video industry is experiencing a significant transformation, moving away from the dominance of Subscription Video on Demand (SVOD) models. This evolution is evident in the growing popularity of various business models, with FAST (Linear format services) also gaining traction in the video industry.

The choice of business model for video services has become complex due to the numerous possibilities. Audience preferences and spending behaviour play a crucial role in this decision. Higher income viewers are more likely to prefer subscription-based models, while older or lower income users, and viewers in some regions, are more likely to prefer ad-based services.

However, the younger demographic is open to Transactional Video on Demand (TVOD) and Pay-Per-View (PPV) options. The blending of these models opens the door to a more sustainable and profitable future for video services.

Monetization isn't just about deciding which business model is best, but also about developing an upselling strategy. Providers should be prepared to quickly switch tactics if a particular method or blend of models isn't paying off. Flexibility and modularity in design are crucial for video services in a multi-model future.

Creating multiple tiers can help maximize revenue from different user segments. Premium package subscribers can get immediate access on the official release date, while viewers, particularly younger ones, may be willing to pay extra for early release of a particular title.

The long-term strategy for any video service should include a focus on upselling. This approach is evident in the recent introduction of hybrid business models combining subscription, advertising, and transactional elements. For instance, platforms like LFG.TV in 2025 provide interactive and monetized features such as real-time tipping, virtual currencies, and direct content purchases, integrating subscription and transaction-based streams alongside community and ad-supported engagement.

Advertising Video on Demand (AVOD) is also gaining popularity. Release dates can be determined by pricing tiers, with basic package subscribers waiting longer for new releases. "Freemium" tiers, offering free content with ads and premium content behind a paywall, are gaining popularity as well.

The blending of business models offers a more sustainable and profitable future for video services. Providers should be prepared to experiment with combining multiple business models to cater to their audience's diverse preferences and maximize revenue.