Commentary

Will They Pay Per View?

Watershed

UStream has evolved quickly into a familiar brand to video junkies and jockeys looking for the one of the quickest, cheapest, easiest ways to get their video online in real-time. Just about anyone can turn a cam onto an event and broadcast it live, and for free, through the service. Until now this has been a hoot and a great resource for us all, but someone has to make some serious money off of all this bandwidth and streaming. The company launched a business-oriented platform called Watershed to service those who want to pay for advanced services and even insert their own ads. Now UStream intends to get some revenue the old fashioned way -- direct from consumers.

The company announced the first in a planned series of ongoing pay-per-view program partnerships to launch later this month. Starting January 31, the "Adam Corrolla Show" will stream live the radio antics of the comedian. Users will subscribe to video access for $9.99 a month or $49.99 a year. Corrolla's show, which is popular as an audio podcast and featured often in iTunes, will get a visual element and live interactivity via UStream. Users will be able to chat with the show.

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If "Man Show" veteran Corrolla's humor is too lowbrow, UStream is aiming higher (or at least for the middle) in a partnership with continuing edutainment brand The Learning Annex. The company is famous for its celebrity instructors like Deepak Chopra, Richard Branson, Harrison Ford and Sarah Jessica Parker. The celebrity hook may make for a decent draw, as well as the special pricing. While Corrolla is demanding a fairly high fee and commitment that likely is aimed at loyalists, Learning Annex is going for volume. The "classes" will go for as low as 99-cents each.

UStream says that the online payments will be handled via PayPal, and previously purchased items will remain accessible to the viewer at the brands' dedicated USTream sites. UStream has executed a PPV project in the past. A year ago it hosted and sold live access to comedian Dane Cook shows.

Does live and on-demand pay-per-view have a chance on a platform that has eschewed direct-from-consumer models in the past? Not likely as a general thing, we think. Fee-based content tends to do better when there is an entire ecosystem of others working to normalize the model for consumers. Mobile media continues to succeed as a pay model despite the proliferation of free content. Its ecology started as a paid system and a wealth of fee-based content is there to reinforce the sense of value others are willing to pay for, too. It is tied directly to a billing system and mobile media works within a platform where other elements are paid for discretely like SMS and data plans. Plopping a new paid model into a sea of free feels discordant.

But UStream is smart to partner first with celebrity rather than simple "premium content." Stardom sells. I am likely to plop down a couple of bucks just to see a movie star I like work in a different context. Deepak Choprah? Maybe not so much. Is there any obtuse platitude he can serve up in a Learning Annex class we haven't heard on too many PBS specials?

3 comments about "Will They Pay Per View? ".
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  1. Jonathan Mirow from BroadbandVideo, Inc., January 21, 2011 at 2:19 p.m.

    In 2003 my company built an entire Video Pay-Per-View system that allowed content creators to monetize educational video assets. It collected money via PayPal. Oddly enough - it was called DataFlix (it's still there, go check out www.dataflix.com) - this won't monetize UStream anymore than paywalls will monetize local newspapers. You have my word, and experience, on that.

  2. Paula Lynn from Who Else Unlimited, January 21, 2011 at 3:39 p.m.

    There is not enough money to be wasted and nothing compelling enough that people can't get hours of entertainment, ad infinitum, for which they have already paid (ads or app or system).

  3. Jack Thorogood from Invideous, January 24, 2011 at 3:40 a.m.

    We recently build out support for PPV in 'live'. Currently we're seeing IRO 11% of viewers convert (i.e. pay) vs. 16% conversion rates for VOD content.

    To be frank our platform is currently better optimised for VOD and as we finesse the product for live we anticipate conversion rates to find parity.

    At a conversion rate of 15% 'success' is in the eye of the beholder. IMO PPV monetises better than ads in many situations and 'live' is often one of these.

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