SMW 17: Monetizing Live Streaming
If OTT has become a standard part of distribution for media companies of any size, how are they monetizing their content? This Live Steaming Summit panel at Streaming Media West identified the three key steps that have helped the panelists create a profitable monetization strategy: be agile, be sincere, and be flexible about meeting viewer needs.
Being Agile
"UFC TV has two different business models—one is a monthly recurring subscriptions where they are monetizing their VOD library," said Charles Mellilo, senior vice president of NeuLion, the platform the UFC uses to deliver their OTT content. UFC TV also broadcasts tentpole programming available as pay-per-view events. To be sure not to leave any money on the table, for viewers willing to pay for top-tier video quality, UFC TV started to offer three different content resolutions—SD, HD, and 4K. Going from high-end 4K broadcasts to mobile delivery could seem like a step backwards, but that's not how some media executives are looking at mobile.
In pitch meetings, traditional media executives are starting to talk about mobile first. "We were in one meeting and what came up was 'What if we did this weekly in digital and monthly for broadcast?' A few years ago that would have been seen as going to the minors, but now they don’t have to be on TV to reach their max audience," said Gabe Goodwin, Blue Duck Media and executive producer at FOX Sports. Of course it's not enough to just do mobile—looking at traffic is vital.
Being Sincere
"You're trying to get an audience to care," said Goodwin. "When you're a TV producer you don’t really find out what people thought of your show until a day or two later. In a live stream you know within a few seconds if what you’re talking about is working or not." The obvious solution, when traffic is declining, is to stop that particular type of content and test to find what trends and drives higher engagement. However, even lower engagement can have its own benefits.
Twitch broadcaster Renée Reynosa's viewers tune in because they find her authentic UGC broadcast on gaming content compelling to watch. She has chosen not to run any advertising on her content. Instead viewers can subscribe at one of three fixed monthly rates or choose to support her exclusively by tips. She and other Twitch broadcasters have noticed a surprising trend—on days when there is a low number of concurrent viewers, there can actually be a higher amount of financial support. Likely her viewers want to keep Reynosa on the air, and by voting with their wallets they are doing just that.
Being Flexible
While Reynosa's viewers don't want advertising, World Surf League (WSL) viewers insist on it. They have a very dedicated international audience and their must have was that they want the content to be free. "We support a service where all of the monetization is done thru advertising," said Mellilo. Ad-supported live content enables the media company to target a very committed niche viewer. WSL has also gained revenue via ad-supported VOD content. "Due to the international nature of the viewers, some audience is always sleeping when the live streaming is being broadcast. We replicate the live experience by providing a VOD stream for viewers who weren't awake for the live stream and provide targeted ads for both the live and VOD audiences," Melillo said.
While each panelist had a unique take on monetization strategy, any combination of these approaches is proving to be a winning formula for media entities large and small to successfully build audience and keep monetizing OTT content.
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