vMVPD versus MVPD: Breaking Down the Differences
From streaming live news and sports to watching your favorite shows without a cable subscription, vMVPDs (Virtual Multichannel Video Programming Distributors) present an appealing alternative for today's viewers.
As you delve into the world of CTV, it’s important to understand the basics behind vMVPDs and how they differ from MVPDs before you start buying streaming inventory. We'll be breaking down all the key differences between the two forms of media distribution to better understand how their respective advantages can be applied in the fast-moving world of TV advertising.
What is an MVPD?
MVPDs offer bundled packages that give audiences access to multiple TV channels through a single service provider. Companies like Comcast and Spectrum were among the first and remain some of the most well-known MVPDs.
Cable providers first offered a limited number of channels. But this quickly changed — over time, as cable companies aggregated more and more channels, cable providers began to bundle channels together in packages. Customers quickly became frustrated, as it forced them to pay for a larger bundle even if they only wanted a few specific channels.
To make matters worse, cable providers pay fees to networks and content creators for the rights to broadcast their programming. Over time, these costs have risen, and these expenses are ultimately reflected in consumers’ cable bills.
What is a vMVPD?
Frustrated with bloated cable packages, consumers have gravitated towards a new solution that came about as the connected TVs emerged: virtual Multichannel Video Programming Distributor (vMVPD). This service delivers live TV channels, and often on-demand video content, in a linear fashion through an internet connection or over-the-top (OTT) device. In other words, it combines the convenience of streaming technology with the traditional broadcast television format.
Like their linear MVPD counterparts, such as Spectrum, Comcast, or Cox, vMVPDs also charge customers a recurring fee. However, what sets vMVPDs apart is their unique offering of "skinny bundles." These subscription packages include a variety of channels at a price lower than that of a traditional MVPD, providing a cost-effective alternative for viewers seeking a streamlined selection of content.
How is a vMVPD different from SVOD?
A common question those new to the space may have is how vMVPDs differ from SVODs (subscription video on demand).
vMVPDs and SVOD services share similarities but have distinct differences. Both operate on a subscription-based model, deliver content over the Internet, and serve as alternatives to traditional cable TV.
The key distinction lies in the type of content each service offers. SVOD services focus exclusively on on-demand content, allowing users to access a library of movies, TV shows, and original programming at their convenience. Netflix is a prime example of an SVOD service that provides a vast collection of on-demand video content.
In contrast, vMVPDs go beyond on-demand offerings by providing access to live TV channels in addition to on-demand content. Platforms like Sling offer a diverse range of live channels, replicating the experience of traditional broadcast television through an internet connection.
So, while SVOD services specialize in on-demand content, vMVPDs offer a blend of live channels and on-demand options, providing users with a more comprehensive television experience through streaming technology.
Which model is right for my brand?
Choosing an MVPD versus a vMVPD boils down to your marketing goals and experience. To choose between the two, consider what makes each model unique.
What type of audience am I trying to reach? According to a survey by Kantar and Amazon, linear TV viewers are more likely to be Gen X and Boomers, while vMVPD viewers skew younger — namely Millennials. With this in mind, brands seeking access to older audiences should consider MVPDs, while those looking to reach younger markets should consider vMVPDs.
What are my marketing goals? Want to drive brand awareness? MVPDs deliver linear TV content, notorious for its massive, efficient reach. On the other hand, vMVPDs work well for lower-funnel campaigns. Enabled by powerful targeting and measurement capabilities and measurement tools, marketers can reach their ideal target audiences, drive conversions, and attribute metrics to their campaigns.
How extensive is my team's experience? Buying on linear TV typically occurs through direct deals — often during the Upfronts. Larger brands have the expertise and industry connections to make these deals and secure their desired inventory. For smaller brands, though, buying in the upfronts can be a challenge. Instead, try buying CTV during the scatter market — it’s far more efficient than doing direct linear deals at the Upfronts. In contrast, the barrier to buying advertising inventory on vMVPDs is lower. vMVPDs often offer self-serve platforms or managed service options, allowing advertisers of all sizes to purchase and manage their ad campaigns easily.
vMVPDs and MVPDs: Getting Started
With this information in your back pocket, you now know what MVPDs and vMVPDs are and how they differ.
vMVPDs are just one piece of the connected TV puzzle. To understand more about the connected TV ecosystem, you need to understand the top industry trends, how CTV buying works, and more. Ready to learn more? We have you covered. Our ultimate connected TV guide covers everything modern marketers need to know about the CTV ecosystem — read it here.