On-demand fitness libraries are four years old now. Most studios still pay instructors the same flat session fee they paid for live classes. Here are three royalty structures that actually work when on-demand is the product, not a backup plan.

Most studios that built an on-demand library during 2020 to 2021 are now four years into it. The library has hundreds of classes. Subscribers watch a handful of them, over and over. And the studio is still paying instructors the same flat session fee they would get for a live class: $40, $60, whatever the rate was the day the camera turned on.

That math worked when on-demand was a backup plan. It does not work when on-demand is the product.

Here is the conversation studio owners eventually have to have with themselves: if the same recording of Tuesday's vinyasa flow is watched 4,000 times over the next two years, who got the value, and how much of it went to the person who actually made the class?

Why flat session pay breaks at scale

Live class economics are simple. Twelve people show up, each pays $22, the studio collects $264, the instructor gets paid $50, the studio keeps the rest to cover the room, the mat sanitizer, the music license, and overhead. The studio takes the inventory risk: empty room, instructor still gets paid.

On-demand inverts that math.

The recording does not expire. Inventory risk goes away. The marginal cost of the 4,001st view is roughly zero. So every additional view past the first one is pure margin for the studio.

If the instructor was paid once at $50, every replay past view #1 is the studio capturing 100% of the upside on someone else's work. That's defensible for a few months. It is not defensible for two years.

Two things happen if you let it stretch:

• Your best instructors notice. Especially the ones who already do their own on-demand on Instagram or YouTube. They start asking the math question, and they usually arrive at the right answer before you do.
• Your less-engaged instructors notice too, but for the opposite reason. They learn that their library classes do not earn them anything past day one, so they stop putting their best work into the camera. Library quality drops. Subscribers churn.

The fix is to stop pretending on-demand is just "live with a recording." It's a different product. Pay accordingly.

Three royalty structures that actually work

I have watched studios try most variations of this. Three structures hold up:

1. Flat per-view royalty

Each completed view of a recorded class pays the instructor a small amount: $0.10 to $0.50 depending on what your subscription costs. Easy to explain. Easy to budget. Instructors with library favorites earn more over time, which incentivizes them to make the kind of classes that keep getting picked.

The downside is exposure: one or two high-engagement viewers can rack up a single instructor's payout faster than you expected. Cap the per-class per-month royalty so a single class cannot blow up your books.

2. Library revenue share

Take all your on-demand subscription revenue for the month. Set aside a percentage: 15% to 25% is the range I have seen work. Split that pool across instructors weighted by the views their classes generated.

This is fairer to the studio because the payout is always bounded by revenue. It is also fairer to instructors with a viral class because their share scales. Downside: instructors do not know what they will earn until the month closes. Some instructors will not accept that uncertainty, and you should not pretend they should.

3. Tiered per-class deals

For a true marquee instructor, negotiate a per-class arrangement at the time of recording. Maybe a $300 buyout. Or a $100 upfront plus a 10% revenue share on that specific class for 24 months. Use this sparingly, on classes you know will be subscription drivers.

The risk: you cannot easily renegotiate after the class blows up. Build a sunset clause, or accept that you will occasionally pay more than the class is worth.

Whatever structure you pick, write it down. The reason these arrangements fall apart in year two is that the original owner-instructor handshake never made it onto paper. A one-page agreement survives staff turnover. A verbal "we'll figure it out" does not.

The tracking problem is smaller than you think

Studio owners who push back on royalty structures almost always cite the same objection: "We can't track views accurately enough."

That used to be true. It is not true anymore. Any modern streaming platform, whether you are using a generic video CMS or running on something more like a branded app, surfaces per-class view counts as a basic feature. If the platform you are on does not, that is a problem to fix before the royalty conversation, not after.

What you actually need:

• Views per class per month, exportable as CSV
• Unique viewers, so a single member watching the same class three times does not get triple-counted (unless your model says it should)
• A minimum-watch threshold: most studios I have seen count a "view" as 50% or 75% of the class completed, not a 30-second hover

That's it. Set the report up once. Run it the first business day of every month. Send instructors their statement with their next payout. The whole monthly process should take under an hour once you have the template.

What this looks like for members

Here is the part most studios miss: the way you compensate your instructors leaks into the way members experience your library.

Studios with royalty structures tend to feature their on-demand instructors more prominently: instructor bios, instructor pages, instructor-curated playlists. That is not a coincidence. The economics push you to treat each instructor as a brand within your brand.

That changes how the app feels. The library stops being a wall of classes sorted by date and starts feeling like a roster of teachers you have a relationship with. Which is exactly what brought people to a boutique studio in the first place, and which is also what your members cannot get from a generic fitness app where the catalog is sorted by algorithm and the instructors are interchangeable.

This is one of the reasons studios are leaving generic platforms and moving to branded apps under their own name. A platform like Fluger lets you publish a Roku, iOS, and Android app under your studio's name (not someone else's) without needing your own Apple Developer account, which means your instructors' faces and names sit on a member's TV next to Netflix and HBO instead of being buried inside a third-party aggregator. The royalty conversation is easier when the platform itself reinforces that your instructors are the product.

How to actually start

If you have been deferring this conversation, start small. Pick one structure. Model it against the last six months of your library data. See what payouts would have looked like under that model. Do not roll it out yet, just look at the math.

If the numbers feel survivable, propose it to one instructor as a six-month pilot. Pick the instructor who is most likely to push back if you do nothing. They will appreciate being the first one asked, and you will learn what the agreement needs to say before you scale it to the rest of the schedule.

The studios that get this right early build instructor loyalty their competitors cannot match. The studios that defer it usually find out the hard way: when their best teacher launches her own platform and brings half the library with her.

Your on-demand library exists because someone showed up, breathed through it, and got it right on camera. Pay them like the library is a product. Because it is.

Ready to give your studio its own branded streaming home, and your instructors a real place to be featured? Start a 14-day free trial at fluger.tv/registration and launch a Roku and iOS app under your studio's name, no Apple Developer account required.