Revenues from subscription fees are now rising quicker than those from advertising for Russian OTT players.
Kommersant reports that Megogo saw an almost three-fold increase it subscription fee revenues in 2016, while subscription fee revenues exceeded ad revenues for the first time at Ivi.
Megogo’s revenues increased by 71.5% to R719.3 million (€11.6 million) in 2016, of which almost four-fifths (79.8%) still came from advertising.
However, the number of paying customers grew by 71% in 2016.
The online video market had earlier been projected to reach R7.4 billion in 2016, or 17.5% more than a year earlier.
Ad revenues would account for R4.6 billion and subscription fees R2.7 billion.
It should be noted that many users of legal OTT services in Russia are still unwilling to pay for them due to the problem of piracy.