CEO Eric Huggers wants to add a paid subscription business to the online music-video source’s ad-supported model
Online music-video company Vevo is readying itself to start charging, planning a subscription option in addition to its current business model of generating revenue on from ads for its massive free viewing.
“We believe in a dual revenue stream,” CEO Erik Huggers said late Wednesday, speaking at the Code/Media conference in Dana Point, Calif., according to a video from the conference on Recode. He noted that the company just posted its best sales year ever under its current business of ads that rack up revenue from free viewing. “The second piece would be a pay model.”
In November, the executive said that Vevo may eventually consider a subscription option to pair with its ad-supported free service but that Vevo was “completely focused” on the ad-based model because the volume of viewing “blows the mind.”
Vevo is one of the biggest presences in online music, but the company has struggled to turn that prime position into a powerful identity outside Google’s video site YouTube, which holds a minority stake in Vevo.
Its catalog of 150,000 top official videos draws more than 16 billion views per month, according to the company earlier this month. Though people can go to Vevo.com to watch clips and original content, the firm’s channel of official music videos on YouTube is where most of its viewership occurs.
That means sharing ad revenue with Google.
But even in a subscription business, Vevo will continue to face competition over customers from YouTube.
Last year, YouTube created a dedicated Music app alongside its launch of its own monthly subscription option, making it easier for listeners to listen to songs, watch music videos and discover other music-related clips.