Last March, ATVOD took over regulation duties from Ofcom for all on-demand programme services (ODPS), essentially long-form online video.
The organisation imposed a flat-rate fee of £2,900 on the services of all notified VOD providers in the UK, including the likes of SeeSaw, Blinkbox and Virgin Media.
The fee, which covers the period from April 1 to March 31, 2011, was introduced so that ATVOD could be "adequately funded to carry out its regulatory activities".
After doing fresh calculations, ATVOD said that its Year One budget stands at £467,307, which is £41,000 more than the organisation initially estimated.
To date, 117 providers of VOD services have been notified, but ATVOD believes that the final number will be closer to 129 services paying the full fee, with three small-scale providers paying a reduced rate of £150.
That would generate an income of £374,550 in Year One fees, while ATVOD also received a grant of £40,000 from the Department of Culture Media and Sport
However, that still leaves the organisation with a £52,757 deficit, which will be rolled into the next financial year, bringing ATVOD's total costs for Year Two to £520,377.
To cope with the financial burden, ATVOD has proposed increasing the flat-rate fee to £3,968 per service for the period from April 1, 2011 to March 31, 2012.
Alternatively, the organisation has suggested introducing a sliding-scale rate based on each company's turnover. Various different options have been proposed for this, such as providers with turnover of more than £25.9m paying £12,330 for the first service and £1,000 for second and subsequent services to a maximum total fee of £25,000 per provider.
Another proposal, dubbed the 'Super A' rate, would see providers with total turnover of more than £100 million paying £13,950 for the first service and £1,000 for second and subsequent services to a maximum total of £25,000.
Smaller providers would be offered discounted rates, such as non-commercial operators paying £150 per service, micro-scale operators with turnover of less than £50,000 paying £250 and small-scale provider with turnover between £50,000 and £100,000 being charged £500 per service.
Industry stakeholders have now been invited to submit their views on the fee proposals. Even though this is a joint consultation between ATVOD and Ofcom, the ultimate responsibility for approving ATVOD's Year Two fees will remain with Ofcom.
Last month, independent TV producer Chris Gosling launched an online campaign aimed at fighting the level of regulation for small-scale web-TV operators, with a particularly focus on ATVOD.