Who wants to pay for internet video?
To stream or to subscribe. iTunes vs. Hulu. The immortal question that faces you, the end-user. How content will be accessed by the masses will effect you the filmmaker as well. As more and more distributors, content providers and studios are moving towards an online business models the landscape of developing content for the internet has exploded. But the concepts behind monetizing that content is still a matter of contention.
There are roughly two models - advertising and subscriber-based revenue.
Advertising is simple. There are the ads on the site and those that are embedded within the video itself. These are tallied on a CPC (cost per click) and CPM (cost per milli, aka cost per 1000 impressions). There's also flat-rate advertising, which is the most like traditional print advertising - someone buys web real estate for their ad to run for a specified amount of time. No click measurements to track.
With subscriber-based revenue the focus is on charging customers to view content. I guess that's more simple than ad-based revenue. Hmm. Anyway, moving on!
OK, so what are the pros and cons and what's right for you?
Let me answer that last question first. Both. There is no right or wrong method for finding a solid revenue stream right now. But there are considerations to be made.
With advertising, you provide your content to your audience for free. In return you need to toss ads up, around, in and on your video to reach the desired goal. If you've ever been to Hulu you've seen the most recent logical step in ad placement, which is basically laying commercials in the video where the commercials would go if you were watching it on TV. You usually cannot skip these ads but clicking them will only open a new window, allowing you to stick with the action and buy something later.
As an independent filmmaker ads are the most widely usable forms of revenue. You have a very limited audience and your content needs to be stellar for people to want to pay to view it. You can team up with Google and lay ads around your site or seek out advertisers and offer them play within your videos.
Without a large audience share your choice of advertisers (and the money they might bring) is small, but it could keep you in business. It all boils down to views. The larger your audience, the more money you make with advertising. If you can show you get 10,000+ views per video you'll have a good shot at making decent money.
The main drawback to advertising is that too much is a bad thing. You want your audience to be able to navigate away from it if they desire, or at least make its impact as small as possible. Look for CPC and Flat-rate ads mainly. Unless you're averaging 10,000+ website hits a day stay away from CPM.
For further reading, check out Google AdSense which will help you ad relevant ads to your website. And eMarketer tends to talk about the industry as a whole, including new advertising models if the current ones just don't float your boat. I now open the floor to any questions and comments.