A 101 On Understanding Your Online Video Competency

To say “Video is the future of Online Media” would be a huge understatement. As we speak, many traditional media companies are looking at video enabling their online properties, while new media companies are creating revolutionary business models around video content. However, video enabling a website is easier said than done! There are three key components that should be considered while doing this:

  • Setting up the required video platform & infrastructure
  • Getting relevant video content that would interest the website’s audience, thus, enhancing the current offering
  • Increasing the monetization of the website while adding video content

Each of these components can be available within the company and/or outsourced.

online_video_infra

Video Platform & Infrastructure

Infrastructure is the software component that helps you upload, organize, manage, publish, distribute, monetize and analyze your video assets online. You could either build this infrastructure on your own or get it from an online video platform company. Unless the video competency within your organization is high and video is core to your business strategy, building and maintaining it on your own is an expensive proposition. When sourcing a video platform, the main considerations are to understand the capabilities in terms of content management, publishing and distribution, ad monetization and support available for the platform. One should also understand the bandwidth and platform costs. This coupled with content costs helps to calculate the ROI on your video strategy.

Video Content

Video content, unlike other content types is not easy to create. Producing video content is both expensive and requires a lot of expertise. An alternative is to procure content from available sources, though this is not necessarily easy. Alternative sources of content would typically come from

  • Traditional content creators
  • Content aggregators
  • Content networks

Sourcing from traditional content creators for online use is tricky as they are used to a set way of thinking and are not always open to the new media revenue models. Traditional content pricing typically involves an upfront fixed fee with geographical limitations. Going to aggregators usually carries fixed fees and in some cases minimum guaranties and/or revenue share. In case of a revenue share model too, most times a minimum guarantee amount is expected. Then there are large content networks where you will not only get content but also a payout when ads are run. However, you will have no control over the in-stream ad monetization and you will have to depend on that content networks’ capability to fill and monetize the same.

Monetization

Monetization is typically from subscriptions, pay-per-view, sponsorships and ads. If you have compelling premium content that is copyrighted or licensed by you then subscription and or pay-per-view models could be an option. But getting scale on the back of subscriptions is not easy; however, if executed correctly, you could make a tidy margin. Monetization through advertising is popular amongst existing websites that have video capability. This requires a website to have a robust video ad server, a direct sales team and a large enough ad inventory, else getting ads directly from advertisers and agencies is close to impossible. Also, geographical split of content views creates a complexity that would require you to offload your remnant inventory to video ad networks. Lack of standard adoption makes integration with multiple video ad networks a complex task. Having done all this, you have to make sure that your analytics and reporting are detailed enough to optimize and maximize revenue generation and profit margins.

If executed correctly, online video will help you reap benefits both in terms of top and bottom line. The key to success is to clearly identify where in the video competency matrix you fall and choose the right video solution partner to guide you through the process.

What’s your take?

[Guest article by Subbu Murugan, founder of Ventunotech.com.]

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