Question

Video Streaming Services obtain content distribution rights in order to stream TV shows and movies on subscribers' TVs, computers and mobile devices. Streaming content is generally licensed for a fixed fee for the term of the license agreement. How do you think these firms should recognize the amounts they pay upfront for these licenses?

Answer 1

There are few conventional bwalys and some unconventional ways of paying for licensed content fees by video streaming plateforms. Some of them are :-

1) Subscription fee:- these are the primary revenue generated by a streaming plateform paid by the subscribers . A streaming plateform can use these funds for paying off cost of licensed shows, movies, videos etc .

2) Leveraging debt :- Based on performance and no. Of subscribers a plateform raises debt in order to bring more contents on its plateform .

3) Selling Ads free subscription :- Many streaming plateform sells different type of subscriptions like ads free and non ads free subscription based on the fee. Thus raises more money. Which they use to pay for contents.

4) Floating Ads while streaming :- These are a big souce of advertising income for the streaming plateform as many brands pay money to reach customers and streaming plateform help them to reach their subscribers by floating ads during intervals and starting while watching a content or floating ads while browsing .