The Streaming Market Conundrum: Content Creators’ Dilemma in the Television Dotcom Boom

In the burgeoning era of streaming, the CTV, AVOD, and FAST Channel market is experiencing a renaissance akin to the dotcom boom of the early 2000s. However, this resurgence has brought with it a clutter of companies whose primary focus seems to be on raising capital and capturing market share, rather than fostering a sustainable ecosystem for content creators and owners.

The Illusion of Growth Over Substance

The industry’s fixation on market share and inflated valuations has led to an organic evolution that is anything but. A myriad of intermediaries have inserted themselves into the value chain, each taking a significant cut of the advertising revenue while contributing little to the relationship between audience, content, and advertiser. This has resulted in a model where content owners and traditional broadcasters receive less than a seventh of the potential revenue due to a combination of lackluster ad-fill rates, a fragmented user experience, and high technical fees.

The YouTube Paradox – Is it not just FAST anyway

Many broadcasters find that they can triple their revenues by simply migrating their content to YouTube, thereby eliminating the technical fees altogether. Yet, this platform is not without its drawbacks. YouTube’s advertising ecosystem often fails to distinguish between high-quality studio productions and user-generated content, leading to suboptimal CTV advertising rates. Moreover, the vastness of YouTube’s content pool means that even the most polished productions can get lost amidst a sea of amateur videos.

View TV Studios: A Beacon of Hope for Content

View TV Studios, a content creator, channel operator, and managed service provider, has recognized the untenable position of content owners who are unable to afford new content production due to the disproportionate revenue shares levied against them. View TV advocates for a model that rewards great content and quality, which theoretically should be highly profitable. However, the current distribution of revenues fails to adequately compensate those who have invested the most in ecosystem.

Kapang: A Walled-Garden Approach – YouTuberly

In response to these challenges, View TV has relaunched Kapang as a walled-garden platform, reminiscent of YouTube’s early days. Kapang aims to return two-thirds of the revenue to broadcasters, more than four times more than existing solutions, by streamlining the path between advertisers, audiences, and content channels. This approach not only provides a platform for View TV’s own broadcast channels and content but also offers a virtual cable solution for both major and niche broadcasters without investing on their own owned and operated solutions. By removing costs and barriers to entry, Kapang provides live dashboards for audience and revenue tracking, along with a full 1080HD or 4K viewing experience.

The Robin Hood of FAST Channels

As FAST Channel and AVOD advertising revenues continue to rise annually, there is a clear opportunity to sustain free-to-air television services. However, the current lack of efficiency means that these revenues are not reaching the content creators who are essential for the production of new content. View TV, through Kapang adX, is addressing this issue by redistributing the wealth from the ‘rich’—the layers of intermediaries—to the ‘poor’—the content creators.

Kapang adX stands as View TV’s clandestine arsenal in the realm of digital video advertising exchanges. It is ingeniously designed to streamline the convoluted process that typically characterizes each advertisement transaction. By eliminating the superfluous layers and numerous intermediaries traditionally involved in ad-trades, Kapang adX ensures a more substantial portion of the advertising revenue from the initial trade is retained.

This innovative approach effectively reclaims over half of the prevalent technological levy—commonly referred to as the ‘tech-tax’—that is customarily imposed on all Connected TV (CTV) Programmatic advertising transactions. In essence, Kapang adX redefines the revenue flow, redirecting it back to its rightful place, thereby fortifying the financial backbone of content creators in the digital advertising ecosystem.

This redistribution aims to reinvigorate the industry and bring game-changing audiences back to streaming cable.

Educating Content Owners to be more careful on understanding the business model

In the rapidly evolving landscape of streaming media, content owners are often enticed by FAST Channel creators and platforms offering seemingly lucrative revenue-sharing deals. However, these arrangements can be deceptive. While a 50/50 split may sound fair at first glance, content owners must scrutinize the details to understand what their 50% actually represents. The reality is that the revenue pie is often sliced by numerous intermediaries before it reaches the content creators. Each layer—from distributors to platform operators—takes a cut, potentially diluting the content owner’s share to a mere sliver of the initial advertisers spend.

For instance, let’s consider the economics of advertising revenue. The industry standard for gross revenue is approximately $25 CPM (cost per thousand impressions), which, with 20 ad slots per hour, should theoretically generate $0.50 per hour of content viewed. Accordingly, content owners should be receiving close to $0.25 per hour of content watched. However, due to the fragmentation of data and suboptimal technology solutions, many content owners find themselves earning as low as $6 CPM, with only 40% of the ad inventory filled. This stark discrepancy highlights the importance of not hastily agreeing to revenue-sharing deals. Content owners should ensure that any partnership includes preferential marketing of their content, covers all technology fees, and provides a sustainable model for creating or acquiring more content.

In summary, content owners must approach FAST Channel licensing agreements with caution. It’s crucial to look beyond the allure of removing costs and barriers to market entry and focus on the actual revenue that will be received. A 50/50 deal may not be equitable if it’s 50% of an already diminished figure. Content owners should advocate for deals that not only promise a fair share of gross revenues but also support the growth and sustainability of their content in the long term. Only by demanding transparency and value from these partnerships can content creators ensure they are adequately compensated for their work and can continue to produce quality content for their audiences.

FAST Channel and AVOD Conclusion in the Dark World of CTV

In conclusion, the streaming market is at a crossroads. The industry must prioritize the needs of content creators and owners to ensure a future where quality content is not only produced but also properly monetized, allowing the true value of creativity to be recognized and rewarded.

Check out View TV Cloud and Kapang Adx