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Subscription video on demand (SVoD) refers to a service that gives users unlimited access to a wide range of programs for a monthly flat rate. The users have full control over the subscription, and can decide when to start the program. They can also pause, fast forward, rewind and stop the show as preferred. It is pay TV programming, and includes TV series and block-buster movies, but with no programming schedule. Top-quality content is available anytime, on demand, directly on the user's TV set. Content is also frequently updated.
Subscribers of SVoD services have unrestricted access to specified programs for a routinely billed fee. In SVoD services, the individual title rates are not applicable. SVoD operates on a distinct business plan when compared with transactional VoD (TVoD). Having said that, the majority of SVoD services have similar content fees to TVoD businesses, although they do not include higher-margin income streams like Internet, PayTV, and fixed or mobile subscriptions. Regardless of the quick boost in SVoD subscriber volumes, the majority of these services still depend on their physical distribution business to stay profitable.
The SVoD service providers are considerably better when compared to cable or broadcast networks in several ways. They can say and show whatever they want because they are not limited by FCC broadcast regulations. They are also unlikely to be engaged in any cable carriage disputes.
In the U.S., the revenue from SVOD services was around $4.3 million in 2010. In 2011, this figure reached a whopping $454 million, establishing SVOD as the biggest segment of the online movie industry in the U.S. Netflix and Hulu are two of the most popular SVoD providers.
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