The Future of Online Streaming: How Fractionalized NFT Subscriptions Unlock a New Pay-As-You-Go Model
#The Inefficiencies of Current Streaming Subscriptions
In the era of digital streaming, platforms like Netflix, HBO, and Hulu have become household names. Yet, with increased competition in the streaming market comes a growing demand for more flexible subscription options.
Today, households find themselves paying up to $47 per month in subscription services despite only 40% of subscribers streaming video content daily. Additionally, the average household subscribes to at least 4 streaming services.
While streaming is popular and widely adopted, the data shows that frequency of usage varies significantly among subscribers. Many might not be using the service enough to justify the monthly costs, making the current subscription model economically inefficient for them.
Streaming platforms have little incentive to shift from the current structure. Yet, as the landscape continues to evolve with more subscription choices and niche content preferences, there's a foreseeable shift towards a future where subscribers seek greater flexibility in their service commitments.
#The Promise of a New Model
What if there was a way to address this inefficiency, benefiting both the subscriber and the platform? A way for users to only pay for the days they actually use the service, and even monetize their subscription on days they don't. Enter the future of online streaming: a Pay-As-You-Go model using fractionalized NFT subscriptions. This innovative approach could offer users flexibility in their consumption while opening a new revenue stream for streaming platforms.
#Understanding the Model
Imagine a scenario where streaming platforms offer a 1-day access pass as an NFT. Subscribers can then sell this access on days they're not tuning in. Upon initially subscribing, every user is equipped with a web3 wallet and receives a unique NFT, tailored to their subscription tier. Here's a potential breakdown:
Basic with ads: Priced at $8/month.
Standard: Costs $15/month
Premium: Available for $20/month
By employing token gating, streaming platforms can categorize their users based on their subscription tier. The access NFT would grant the buyer a 24-hour upgrade, during which the original account becomes temporarily inaccessible. This NFT would allow another user a 'view-only' version of the account for a day, with viewing rights but no saving capabilities.
#Trading Dynamics
A standard tier subscriber can sell a 1-day access pass to a newcomer.
Those on the standard tier can also offer a day's access to someone on the basic with ads tier.
Premium subscribers can sell a day's access to both standard and basic with ads tier subscribers.
Platforms could also manage the marketplace for trading these subscriber NFTs, imposing a royalty of 30-50% on every transaction. This ensures that users are incentivized to consider long-term subscriptions over repeatedly buying short-term passes. It also guarantees a healthy profit margin for the platform.
#A Mutual Benefit
Let's explore a hypothetical situation. A Premium subscriber, paying $30 monthly but only watching over weekends, could monetize their subscription by selling access during weekdays at $1/day. Given that these NFTs would likely be traded on an L2 (Layer 2) where fees are minimal, the economics are favorable. For every 1-day access pass NFT sold at $1, the platform would impose a 30% royalty, making the buyer's cost $1.30. Over 30 trades, the platform would earn $9.
This model allows streaming platforms to potentially gain an additional 30% from trading activities of a single premium subscriber. At the same time, that user can save money during inactive periods.
#Cross-Streaming Partnerships
Leveraging the interoperable capabilities of the blockchain, streaming services like Netflix and Hulu could offer a new feature that allows their subscribers to temporarily swap access to each other's exclusive content. For instance, a Netflix user could trade a one-day Netflix pass for a one-day Hulu pass, enabling them to watch Hulu's exclusive shows or movies without needing a separate subscription. This could radically simplify how streaming services handle content licensing, as they might choose to facilitate these one-day pass swaps among their subscribers and collect transaction fees, rather than negotiating individual licensing agreements with movie and TV studios.
#Conclusion
A Pay-As-You-Go model, leveraging fractionalized NFT subscriptions, could redefine the streaming landscape. It offers unparalleled flexibility to subscribers and opens up novel revenue streams and rare opportunities for collaboration amongst streaming platforms. As the worlds of online streaming and blockchain merge, this solution might just be the transformative approach the industry needs.