What is OTT and is it right for your video business?


Depending on who you ask, TV is either dead or stronger than ever. Polarizing extremes indeed; however, one thing that has changed for sure is how audiences consume video content now. An increasing number of people opt for streaming services and online video platforms for their daily dose of entertainment.

With the change to over-the-top or OTT viewing, content creators across industries have landed an excellent opportunity to increase visibility, garner more followers, and earn more revenues.

In this article, we will discuss how launching an OTT service can boost your business and when it’s the right time to start one. But first, let’s start from the basics:

What is OTT?

You have heard of Netflix, Amazon Prime, and Hulu. You may have even spent your weekends binging on your favorite Netflix special or watching a movie on Amazon Prime. If so, then you already know OTT.

OTT stands for Over-The-Top, a term that is primarily used to describe the distribution of film and TV content delivered through the internet, without the need for a subscription to traditional cable or satellite pay-TV services.

Any online content provider that delivers content on the web is an OTT streaming service. Streaming services today rule the video content industry with OTT services like Netflix, Hulu, and Amazon Prime, being some of the most popular OTT platforms.

Why you should you launch an OTT service

OTT services have changed the face of modern media consumption. Streaming services are becoming increasingly popular today, with more people opting for them over traditional cable TV. A market report by TDG predicts that by 2030, 40% of America’s population will be Cord Cutters, replacing their cable subscriptions with streaming services like Netflix, and Hulu.

Here’s how launching an OTT service can help your business:

1. Expand your revenue

The growth in revenue of OTT streaming services has been phenomenal in the past few years. Consumers have never been more willing to pay for content. Advertisers are allocating more budgets for ad-based streaming services year-on-year. 

In 2019, consumers are expected to spend a whopping $39 billion on SVOD streaming services to watch premium content. This is an increase of 25%, up from $29 billion in 2018.   

Ad-based streaming services are experiencing similar growth. Global revenue from AVOD will nearly triple from $21.9 billion in 2018 to $56 billion in 2024. Advertisers are moving their budgets from TV to digital and this trend is only going to increase in the coming years. 

There are only a few industries that are consistently growing at 25%+ year-on-year.

At the same time, launching your streaming service helps you monetize your content in many ways. You can monetize with ads, charge your subscribers, sell merchandise, or use a combination of these 3 models to monetize your service. 

There has never been a better time to launch your OTT streaming service to maximize your revenue potential. 

2. Expand your audience base

Millions of people watch videos on their mobile phones, desktops, and smart TV devices. Launching your streaming service can help you tap into this huge user-base.

It is a known fact that younger people prefer watching videos on mobile than TV. Mobile data traffic has grown 17X in the past 5 years! In fact, half of global video consumption is on mobile devices. 

At the same time, Smart TV’s household penetration is projected to grow from 11.5% in 2013 to 32% in 2019.

It is clear that mobile and smart TV devices are here to stay and launching your service across these platforms will help you expand your audience base.

3. Build a direct relationship with fans

Launching your streaming service will help you know your audience better. 

Ever thought how Netflix is able to recommend personalized videos to each user? Netflix is able to do that because each user has a separate account (if we don’t consider password sharing for a moment!)  which helps them know their tastes and preferences. 

Knowing your audience also helps you create better and relevant content. For example, if you get to know the top 5 videos watched by users in the last 30 days, you can create relevant videos to increase video views and watch-time. 

Since you directly interact with your audience through your apps, you can notify users (through push notifications and emails) whenever you create new content.

Since you have each user’s email, you can send regular marketing emails and ask them to buy merchandise. 

Imagine the kind of interaction you can have with users through your own streaming service which would have never been possible on YouTube/ Television.  

4. Improve overall margins

Margins are much higher when you launch your OTT service since there are no middlemen involved. 

Unlike YouTube, you don’t need to share 45% of your revenue with someone. Unlike traditional TV, you don’t need to share uplinking and downlinking fees, commissions and distribution fees. 

If you go ahead with a SaaS platform like Ventuno to launch your streaming service, you just need to pay a monthly fee and incur CDN costs (based on your consumption). The overall cost for launching and maintaining your service will be far less than what you will pay if you want to launch on your own. 

So the final question remains:

Is OTT right for your video business? Four questions that will help you decide:


1. Do you have sufficient content to get started? 

The most important thing to know about having an OTT service is that you should have sufficient content. Because OTT media is a specialized market, having adequate content is necessary for sustainability, profitability, and competency.

The number of videos needed, of course, depends on a lot of factors such as the category of your videos, your monetization strategy, and your user’s interest. 

For example, if you create shelf life videos (videos which can be viewed for years) such as Yoga or comedy videos, creating a few videos a month might be enough to keep your audience happy. But if you have non-shelf life videos such as news videos, you need to create videos every day as the video won’t be relevant after a week. 

On average, ad-based streaming services need to have a lot more videos than subscription-based services. Many niche subscription services create few but high-quality videos every month. 

One more way to determine if you have sufficient content is to see your competitor’s content strategy. You can study 4-5 streaming services in your niche to determine whether to get started now. 

2. Do you have premium content?

Content is king, and that’s why it is so essential to deliver fresh and compelling content to your consumers if you want to retain them. 

There are 2 ways content can be premium  – it has to be unique, high-quality or both. 

Why is Netflix spending billions on producing original content every year? It is because their content is unique and high-quality at the same time and people are willing to pay for it. 

Consumers today want to have a choice in their entertainment experience. If you are a content creator who has premium content to offer, OTT services can be the perfect platform for you.

3. Does your content have demand in the market?

If you create content that is in high demand, then OTT will allow you to stay ahead in competition while still being in control of your content.

For example, Hotstar, a leading streaming service in India, has been used by millions of people since it started off in 2015. Hotstar gained popularity mainly because it had exclusive rights to Cricket content. Cricket has a huge demand in India and Hotstar was able to cater to that demand. 

Does your content already have demand in the market? If yes, you should probably start your OTT service. 

4. Do you have a marketing strategy? 

You need to have a solid marketing strategy before starting your streaming service. There is no point in launching an app that can’t get any install base.  

There are many ways you can market your service: 

  •     Paid media (Google Adwords, SEM, radio ads)
  •     Owned media (promoting through your own website, social media accounts, blog)
  •     Earned media (print ads, sponsored blog posts, and online ads)
  •     App Store Optimization

If you can’t leverage multiple online and offline platforms to sell your service, then you should wait before you have a comprehensive strategy to promote your OTT service.

Summing it up

OTT is the future of TV. And so, launching your OTT service is a viable option, provided you do your homework, build a marketing plan, and, more importantly, produce consistent quality content for your audience base.

Are you a content creator looking to launch your OTT service in the market? We can help! Our SaaS platform helps content creators launch, manage and monetize their OTT streaming service from a single dashboard. You can launch your service for web, mobile (Android, iOS) and connected TV devices (Roku, Amazon FireTV, Android TV, Apple TV, LG TV, and Samsung TV). Click here to know more.




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