Media, luxury and education
SVOD and AVOD
Streaming paid for by subscription (SVOD) versus paid for by advertising (AVOD).
Last reviewedWhat does SVOD and AVOD mean?
SVOD (subscription video on demand) services, such as Netflix, charge a monthly fee for viewing without ads. AVOD (advertising video on demand) services, such as YouTube or free ad-supported TV channels (FAST), are free to watch and earn money from ads. Many services now run both: a cheaper plan with ads and a pricier plan without. Example: a subscriber on an ad plan pays 7 a month and sees 250 ad impressions a month sold at a CPM of 20, worth 5 to the service, so the service earns 12, more than from a 10 plan without ads. The right mix depends on how much advertisers pay per viewer and how price-sensitive viewers are.
Where does it come up in case interview prep?
- How media, streaming, and gaming make moneyLesson in Media, streaming, gaming, and advertising
- Subscriber and content economicsLesson in Media, streaming, gaming, and advertising
- Media players, trends, and how to crack the casesLesson in Media, streaming, gaming, and advertising
- Sports and live events players, trends 2024 to 2026, and how to crack the casesLesson in Sports and live events
Related terms
- CPM (cost per thousand impressions)The price an advertiser pays for 1,000 views of an ad.
- ARPU (average revenue per user)Revenue divided by the average number of users.
- Churn and retentionThe share of customers who leave in a period, and the share who stay.
- Content amortizationSpreading the cost of films and shows as an expense over the years they are expected to earn.
- Fill rate (advertising)The share of available ad slots that are actually sold and shown.
- ARPPU (average revenue per paying user)Revenue divided by only the users who pay, not all users.
- Payer conversionThe share of users who pay for something in a period.
- DAU/MAU ratioDaily active users divided by monthly active users: how often people come back.