Vimeo to Begin Offering Subscription Video Services
The company, which has long made money off of its premium subscription for video creators, now wants to create a consumer-facing subscription business.
Vimeo will take on Netflix, Amazon and YouTube with the upcoming launch of new consumer-oriented subscription video services.
Vimeo owner IAC, which announced the addition of subscription services as part of its Wednesday earnings report, is offering few details about what these services look like, how much they will cost or what type of programming they will offer.
IAC CEO and interim Vimeo CEO Joey Levin laid out the strategy in a letter to shareholders that detailed Vimeo's years building up a subscription service for video creators. "We now have 750 thousand creators paying for our services on a subscription basis, and growing nicely," he writes, later noting that that business has more than $75 million in revenue and is profitable even as Vimeo as a whole continues to lose money.
But he also went on to explain that the changes in the pay TV and film industry have left an opportunity that Vimeo feels like it can seize. "Vimeo has the once-in-a-generation opportunity to, following in Netflix's footsteps, deliver compelling subscription viewing experiences for consumers in the market for pay TV," continued Levin. "I believe we can do so at a fraction of the cost of other major competitors by virtue of the audience and content benefits conferred upon Vimeo through our existing marketplace. And I believe we can do it in a way that empowers the content creators."
Vimeo, he says, already has a library of 115 million videos and reaches an audience of 240 million a month. The Vimeo offerings will be available through the company's own platform. Vimeo also will strategically fund content, much like it did with High Maintenance before the show jumped to HBO.
Coinciding with the push into subscription video, Vimeo is undergoing a redesign to create a new consumer experience.
"Ultimately, our goal is for Vimeo to drive millions of subscriptions and transactions for our creators while also growing a proprietary subscriber base with millions of customers directly," Levin writes.
Vimeo has been lining up the pieces for a move into subscriptions for some time, earlier this year acquiring subscription technology provider VHX. In June, longtime CEO Kerry Trainer stepped down from his post and Levin became interim CEO, noting at the time that IAC has "tremendous ambition for our video segment." IAC also owns Electus and CollegeHumor.