SVOD, AVOD, TVOD: Video on Demand Models Explained

Last Updated: May 26, 20248 min readCategories: Connected TV (CTV), Marketing

Video on demand (VOD) has transformed modern entertainment, offering viewers unparalleled flexibility and control over what they watch. Whether through subscription-based services, ad-supported platforms, or pay-per-view rentals, VOD caters to diverse preferences.

This article will explore these key models—SVOD, AVOD, and TVOD—and how each approach impacts the industry.

What is SVOD?

SVOD, or Subscription Video On Demand, is a VOD model where users pay a recurring fee to access a vast library of video content.

Popularized by services like Netflix and Disney+, it allows subscribers unlimited viewing of available content without additional costs. This predictable subscription revenue model appeals to both consumers and content creators for its convenience and sustainability.

How Does SVOD Work?

SVOD services operate by charging users a monthly or yearly fee for unlimited access to a curated catalog of TV shows, movies, and original content. Subscribers can stream or download this content on compatible devices as long as their subscription remains active.

SVOD Platforms & Services

SVOD platforms have surged in popularity, offering a wide range of content for monthly subscribers. Major players include:

  • Netflix: The pioneer in streaming, offering a global library of original and licensed content. (Read our guide on Netflix advertising.)
  • Disney+: Specializing in family-friendly content from Disney, Marvel, Star Wars, and National Geographic.
  • Amazon Prime Video: Features a diverse selection of movies, series, and exclusive Amazon Originals.
  • HBO Max: Known for prestige content, including HBO Originals and Warner Bros. productions.
  • Apple TV+: Offers a growing library of original films, series, and documentaries.
  • Paramount+: Combines Paramount classics with new shows from CBS, Comedy Central, and more.
  • Hulu: Blends original programming with a mix of TV series, movies, and next-day network shows. (Read our guide on Hulu advertising.)

Pros of SVOD

Some of the advantages of SVOD are:

  • Unlimited Access: Subscribers can stream a vast array of content, from movies to TV series, without additional fees.
  • Ad-Free Viewing: Most platforms offer uninterrupted viewing, allowing users to enjoy content without commercial breaks.
  • Original Content: Exclusive shows and movies often provide high-quality entertainment not available elsewhere.

Cons of SVOD

Some of the disadvantages of SVOD are:

  • Subscription Costs: Multiple subscriptions across platforms can lead to high cumulative monthly expenses.
  • Content Fragmentation: Popular shows may be spread across different services, requiring multiple subscriptions to access everything.
  • Library Turnover: Licensing agreements can cause content to periodically disappear from libraries, leaving subscribers unable to watch their favorite shows or movies.

What is AVOD?

AVOD, or Advertising Video On Demand, is a VOD model where viewers access content for free but are shown ads at intervals during their viewing experience.

Popular platforms like YouTube and Tubi rely on advertising revenue to support the cost of streaming, making the service accessible to a broad audience. This model provides advertisers with targeted exposure while giving viewers a cost-free way to enjoy various entertainment options.

How Does AVOD Work?

AVOD services generate revenue through ads strategically placed before, during, or after video content, offering free access to viewers who accept these interruptions. Advertisers pay for their ads to reach specific audience segments, benefiting from the platform’s user data to target their messages effectively.

AVOD Platforms & Services

AVOD platforms provide viewers with a wealth of free content, supported by advertising revenue. Some leading services include:

  • YouTube: Offers user-generated and professionally produced videos, with free ad-supported streaming for non-subscribers.
  • Tubi: Provides a vast catalog of TV shows and movies, fully funded through commercial breaks.
  • Pluto TV: Combines on-demand viewing with live streaming channels, featuring ads across both formats.
  • Peacock Free: Offers a selection of NBCUniversal content, including TV series, movies, and sports, all with limited advertising. (Read our guide on Peacock advertising.)
  • Crackle: Focuses on curated TV shows, movies, and original content, monetized via regular ad breaks.

Pros of AVOD

Some of the advantages of AVOD are:

  • Free Access: Viewers can watch a wide variety of content without paying a subscription fee.
  • Diverse Content: Offers both user-generated and professionally produced shows, movies, and live channels, often with unique and niche programming.
  • Advertiser Benefits: Advertisers gain access to highly targeted audiences, optimizing the impact of their marketing campaigns.

Cons of AVOD

Some of the disadvantages of AVOD are:

  • Ad Interruptions: Frequent commercial breaks can disrupt the viewing experience and be frustrating to users.
  • Limited Selection: Some high-demand or exclusive content may be unavailable due to licensing restrictions, limiting variety.
  • Data Privacy Concerns: The collection of user data for ad targeting raises potential privacy issues for viewers.

What is TVOD?

TVOD, or Transactional Video On Demand, is a VOD model where viewers pay a one-time fee for each piece of content they wish to watch.

This fee can be for renting (with a limited viewing period) or purchasing (for permanent access), offering flexibility to those who prefer paying only for specific movies or shows. TVOD platforms like iTunes and Google Play provide access to extensive catalogs, allowing viewers to choose from the latest releases and classics alike.

How Does TVOD Work?

TVOD platforms allow users to rent or purchase individual titles, giving them temporary or permanent access to the selected content. Renters typically have a limited time to start and finish the video, while purchasers can download or stream it anytime after the transaction.

TVOD Platforms & Services

TVOD platforms cater to viewers who prefer a pay-per-view approach, offering access to specific titles for rental or purchase. Key services include:

  • iTunes/Apple TV: Provides an extensive catalog of new releases, classics, and TV shows for both rental and purchase.
  • Google Play: Features a wide selection of movies and TV shows, allowing users to rent or buy individual titles.
  • Amazon Prime Video (TVOD Section): Offers a separate section where users can buy or rent content outside of the Prime subscription library.
  • Vudu: Specializes in high-quality video rentals and purchases, including 4K UHD content and early digital releases.
  • YouTube (Movies & Shows): Provides an on-demand marketplace for viewers to access specific titles on a transactional basis.

Pros of TVOD

Some of the advantages of TVOD are:

  • Content Ownership: Viewers can permanently own purchased content, rewatching it as many times as desired.
  • No Subscription: Offers flexibility by allowing users to pay only for the content they specifically want to watch.
  • Early Releases: Often provides early access to the latest movie releases before they become available on other platforms.

Cons of TVOD

Some of the disadvantages of TVOD are:

  • High Costs per Title: The cumulative cost of purchasing or renting multiple titles can exceed subscription-based models.
  • Limited Library: Users must pay separately for each title, restricting access compared to services offering comprehensive libraries.
  • Expiring Rentals: Rentals have limited viewing periods, sometimes forcing users to rent the same title multiple times if they want to rewatch.

SVOD vs. AVOD vs. TVOD: Summary of Differences

That was a lot of information, so a brief summary is probably in order. Understanding the differences between SVOD, AVOD, and TVOD helps highlight the unique benefits and challenges of each VOD model.

Payment Model

  • SVOD: Users pay a recurring subscription fee for unlimited access to a curated library of content.
  • AVOD: Viewers can watch content for free (or at a reduced cost) but must sit through ads that generate revenue for the platform.
  • TVOD: Viewers pay per title, either renting for a limited period or purchasing for permanent ownership.

User Experience

  • SVOD: Provides seamless, ad-free viewing with unlimited content access, as long as the subscription remains active.
  • AVOD: Viewers can enjoy free content with periodic ad interruptions, offering a varied library for those willing to accept commercials.
  • TVOD: Enables viewers to hand-pick content for temporary or permanent access, but requires separate payments for each selection.

Revenue Generation

  • SVOD: Generates consistent revenue through predictable subscription fees, often supplementing with merchandising or licensing.
  • AVOD: Primarily relies on advertising revenue, leveraging targeted ads to generate income based on the viewer demographic.
  • TVOD: Earns revenue directly from content transactions, benefiting from new releases and viewers’ desire for immediate access.

Related: MVPD And vMVPD: Differences And Similarities Explained

How Do CTV and OTT Fit In the Picture?

Connected TV (CTV) and Over-the-Top (OTT) platforms are integral components of the digital streaming landscape, reshaping how advertisers reach audiences and how viewers consume TV and video content.

  • CTV refers to devices that connect to the internet and enable the streaming of video content directly on a television, such as smart TVs, streaming boxes (like Roku or Apple TV), and gaming consoles.
  • OTT, on the other hand, refers to the delivery of film and TV content via the internet, on all devices (not just TV sets) bypassing traditional platforms like broadcast, cable, or satellite TV providers.

Both CTV and OTT are pivotal in the evolution of streaming TV advertising. They offer advertisers detailed data analytics and targeting capabilities, allowing for more tailored and effective marketing strategies.

Advertisers can leverage these unique forms of programmatic advertising to achieve a greater degree of personalization and measurement, moving beyond the broad targeting and limited feedback loops of traditional TV advertising.

This shift not only enhances the viewer’s experience by making ads more relevant but also boosts the efficacy of ad campaigns.

SVOD, AVOD, TVOD: Final Thoughts

SVOD, AVOD, and TVOD each offer unique approaches to video consumption, shaped by distinctive payment models, user experiences, and revenue strategies. With the rise of OTT and CTV platforms, streaming TV advertising has transformed, allowing marketers to blend the precision of digital marketing with the reach of traditional TV.

Understanding the nuances of each video-on-demand model empowers businesses and viewers alike to make informed choices in a rapidly evolving digital landscape.

Did you find this article helpful? Give it a share!

News Via Inbox

Get our monthly report on all the latest and greatest trends in digital marketing.