How much does it cost to have a video streaming platform?
Choosing among a pay-as-you-go, subscription-based, or custom video streaming platform – what are the alternatives?
Video streaming is not a geeky whim anymore but an everyday reality. It became a standard in marketing and content distribution in recent years. For example, many large content providers, such as Disney, consider streaming platforms as a primary means for reaching their audiences. Moreover, in mid-2020, less than a year after the launch, Disney+ achieved 60 million subscribers worldwide, hitting the low mark of their 4-year goal of 60-90 million global subscriptions. Disney’s case is just one of the many streaming platforms’ success stories that come to prove the rapid growth of Over-the-Top (OTT) video distribution.
The positive trend in streaming content delivery caused the faster development of multiple OTT platforms. Some of them are offering proprietary streaming solutions, while others are providing subscription-based services. These services made streaming even more widespread by catering streaming platforms to content owners with limited resources.
This article will discuss several financial models for utilizing streaming, ranging from simple subscription-based services to developing custom OTT platforms.
Subscription-based or pay-as-you-go streaming service
A quick “top streaming platforms” Google search will show you many articles listing various platforms providing video streaming services. These platforms differ by the set of features they are offering, the pricing models, the ease of scalability, and the facility of customization. At first glance, this is the cheapest and fastest time-to-market (TTM) option. And it is. Sometimes in the rush of time, it provides a remedy to the streaming needs. As soon as demands increase and the need for customization, flexible scaling, and additional features appear, you will realize that this option is neither faster nor cheaper. However, if you’d like to try video streaming and have some time for experiments, this could be an excellent way to go, especially when using the pay-as-you-go option.
It is hard to estimate such streaming services because there are multiple pricing variations offered by numerous platforms. Besides, in most cases, the pricing for additional development services is not very transparent. Depending on data, traffic, storage, number of viewers, third-party services, etc. the price tag varies.
Subscription-based streaming service handled by a software development expert
If your dedication to providing streaming to your audience is robust and your decision is unambiguous, you might want to reach out to a streaming development expert. Software as a service (SaaS) option is the best approach for time- and money-saving and brings a hassle-free setting of the optimum video streaming platform. This option provides consultation for choosing the most appropriate streaming platform for your needs, a complete set-up, customization (according to the platform’s possibilities), and additional support and development if needed.
In most cases, the streaming service expert has a list of trusted partnering OTT platforms but does not limit itself only to this. Based on your needs and requirements, the expert will do additional research and will offer you several streaming platforms to choose from. Once you make up your mind, the streaming expert will implement the full integration and set-up for you, which will take approximately two weeks. After the initial arrangement, if you need engineering assistance, development, and implementation of new features, the expert will be at your disposal. For example, such a task could be integrating a recommendation engine that very often is not included in the basic feature set, but is highly appreciated by the end-users.
An example of a feature set included in this option is:
Set-top + Mobile App Templates
Full Content Management System (CMS) feature set
Subscription Video-on-Demand (SVOD) & Transactional Video-on-Demand (TVOD) / (Pay-per-View)
A set number of Stream Hours/mo (live or VOD)
A set number of Hours Transcoding/mo
Linear Playout (VOD to linear)
The overall benefit you get from hiring a streaming expert is not just the consultation and development but also the reduced subscription fees paid to the streaming service provider. The total cost for such a streaming solution depends on several variables, and the approximate range is pretty wide. However, we still could frame it between $5K and $10K per month.
Hiring a video streaming solutions development team
Another, more advanced option, which is more relevant to larger content providers with technical expertise and in some cases already available OTT platforms, is hiring a professional team. Building and sustaining a dedicated software development unit provides an extension of in-house engineering capacity. It brings the flexibility of team size scaling, optimized TTM, and reduced operations risk. Utilizing an experienced streaming solutions developer’s knowledge and resource adds wider expertise and brings valuable consultancy and guidance for an OTT platform’s future development.
A streaming solutions expert has broader experience developing, implementing, and supporting various features in multiple streaming solutions. This fact facilitates the TTM for launching new features but also improves their efficiency.
In the so-called Time & Material (T&M) projects the development experts are hired to complete a specific task. In other cases, the OTT platform owner can hire a dedicated development team with a long-term commitment. This unit practically operates as a remote crew under the client’s supervision. One way or another, the client benefits from the proficiency of highly-skilled developers with in-depth competence in video streaming solutions, OTT platforms development, and their real-life application. Depending on the technology stack, seniority, and time-frame of the engagement, usually, the average per man-day prices for an experienced software developer specialized in this field is about $440.
White label licensing model
White label licensing is most appropriate when you know a vendor with an already existing OTT platform which features, functionalities, and market scope are similar to yours. White labeling is a relevantly cheaper and faster TTM solution than developing a custom OTT platform from scratch.
The license provider can implement customization, additional development, and the initial set-up in three months. This period is more extended than the second subscription-based streaming service model but is way faster than developing a custom streaming platform. The white-label model provides greater flexibility and functionality compared to the second one. Another advantage is that practically you are the platform owner and are in control of the content storage and user management. This model is the optimum choice for those looking for increased security. An addtional benefit of this model is the continued support and update of new features.
The costs for a white label OTT platform varies according to the included features and required customizations. The initial charge starts from $100K, plus payments to third parties for storage and CDN infrastructure. An annual License Maintenance Fee appears after the first year, which could be in the range of $40K+.
Developing a custom video streaming platform
Building a custom video streaming platform is usually the big players’ choice, such as telecoms and media companies (check out a case study about developing a custom streaming platform for a large media broadcasting operator). These are customers that have vast libraries of content and enormous numbers of potential viewers. They need complete control over the OTT platform and require the utmost level of security. Their streaming platform should bring superior user experience and functionality that makes them stand out.
An example feature pack of a custom-made streaming platform includes, but is not limited to:
Create an account
Add and Manage Premium Subscriptions
Login / Registration flows
On-Demand Asset Page
Live Event Asset Page
Search & Search Box
Watch Later List
Platforms – Android, iOS, Web, AndroidTV, Chromecast, etc.
Platform session limits
Player – Analytics, Overlays, Supported Codecs, Multi Audio, DRM, Timeshift, Thumbnail preview
Floating Video Player
OTT Headend – Live streams, Live2VOD, VOD
The prices for a similar streaming solution range from ~$800K ~$1,5M depending on the features.
The streaming solutions market is continuously growing while the increased competition urges players to become more flexible and offer faster, more efficient functionalities. This process brings benefits to the content providers and the end-users alike, offering them various alternatives. Depending on their resources and plans for development, content owners can choose from several different financial models and technical solutions. When you find yourself dived in with such a multitude of offerings, it makes the best sense to consult with a video streaming expert to guide you to the best solution.
Which option would be optimal for your video streaming project? Call us to discuss it!
Greetings from the author
I’m Adelina. Good to meet you!
For more than 16 years I have been working in Bianor and for the last 7 years being the Business Development Officer of the company.
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OTT Video Streaming Essentials Fact Sheet
Download Bianor’s OTT Video Streaming Essentials Fact Sheet to learn more about the five most crucial components in video streaming.