The CMC's analysis found that on average, affiliates using the VOD In a Box service increased their pay per view revenues by 17 percent, per month for each of the first 12 months following their launch of the managed VOD service. Most systems also generated additional revenue growth through increasing their premium channel revenues, as a result of enabling customers to enjoy subscription video on demand (SVOD) services, and by growing their digital subscriber bases through increased sales and reduced churn.
On the expense side, the VOD In a Box service, which allows cable systems to accept content from multiple sources without requiring management of the content at each headend, reduced capital expense by 25-50% and operating expense 30-50% over a typical VOD system, the CMC's analysis found. As a result of the increased revenues and lower costs for launching the service, the potential discounted payback for affiliates that use the VOD In a Box service can occur within as few as 13-18 months of operation, as compared to the 30 to 40 months typically required for launching a typical VOD system, the CMC found.
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