A Comprehensive Guide to OTT: Definition, Tech, and Benefits

4 Mins read

Over-the-top (OTT) streaming has been on the rise recently, and it seems like it will continue to grow in the near future and beyond. OTT application development played a huge role in the advancement of the industry since more and more people utilize apps to watch their favorite shows, movies, and educational tutorials. This is a great opportunity for companies and organizations to generate revenue from the increasing demand for OTT content.

According to Statista, over-the-top TV and video revenue is expected to reach $235 billion by 2028, which is a doubled number from what was reported in 2021. 

In this article, we’ll speak about OTT in detail. Let’s dive in.

What is OTT?

OTT, or over-the-top, is a technology that helps content providers deliver videos to viewers’ devices via an Internet connection. The technology quickly gained popularity among broadcasters as a viable alternative to traditional television, such as cable or satellite. 

An OTT streaming service is an online service that offers streaming audio or video as a product. When entering an online video streaming service, viewers usually see a large number of videos they can watch at the very moment. But under the hood, multiple processes are happening. 

A content provider creates a video. After that, it needs to be prepared for delivery through the Internet and uploaded on servers. Furthermore, it is far better to have plenty of video copies in different bitrates and sizes so that the video can meet the requirements of a receiving device and network conditions. 

All that works together in order for viewers to enjoy the original content that streaming services provide. 

What Content Formats to Deliver with OTT?

 The two main content formats popular in the OTT industry are VOD (video-on-demand) and live. 

VOD streaming is when videos are stored on servers waiting for a user’s request to be played. Such content is available at any time when people wish to watch a video. It is the answer to why online streaming services are so popular today. 

VOD services remove a fixed schedule and attachment to TV sets in the living room. They operate on multiple platforms and devices on viewers’ demand. People access online streaming services on different TVs, mobile phones, tablets, and desktops. It means that watching videos from anywhere is possible. All a viewer needs is a dedicated internet connection and a compatible device.

Live streaming is about producing and multicasting a video in real time, which provides multiple opportunities for businesses. They can communicate with people and show their expertise live, persuading people to consume more of your content and feel closer to your brand. Also, live streaming is a common practice when it comes to streaming such events as concerts, webinars, sporting events, church services, and others. 

Benefits of OTT Video Streaming Business

#1 Multiple opportunities to capitalize

With the right OTT software solution, you have multiple options on how to generate revenue by producing your content. For example, there are three main monetization models widespread in the OTT industry:

  • Subscriptions are the most popular model: viewers purchase monthly or yearly access to a video library in the service. When a paid period ends, people can renew or cancel their subscriptions. Researchers say that an American household has 3-4 subscriptions on average. 
  • Advertisements are, as they say, a new fashion. Many content providers switch to advertising or add it as an additional plan to retain customers on the platform. Usually, ad-based streaming services offer content for free as a provider generates revenue by running commercials on videos. However, some creators use advertising to lower the price of a subscription plan.
  • A pay-per-view allows you to sell access to each video, unlike subscriptions. Viewers pay only for a video they want to watch, and the rest of the content remains inaccessible.
  • The hybrid monetization model allows you to combine several revenue-generating approaches.  

Along with monetization models, you can boost your income by covering more devices or locations. Suppose your service operates only on TVs. Then, you will have more clients if you let people watch your content on smartphones. 

CDN will help you deliver videos anywhere in the world, providing a smooth viewing experience. Reaching more viewers means making more revenue.

#2 Boosting your service 

Knowing the importance of development for video streaming services, professional companies designing the OTT solutions (like Setplex) implement analytics tools. Utilizing it will lead you to success as you understand the performance of your streaming service and can make adjustments to the strategy. 

Real-time analytics provides you with data on your content performance, user behavior, and preferences. Moreover, you will see if there are any technical issues on the platform and be able to troubleshoot immediately.

#3 Multiple chances to succeed 

To succeed in the OTT industry, you need to pay attention to three things: content, marketing, and technology, which is the OTT solution. 

The right technology will help you ensure the best viewing experience for your customers. Furthermore, when you have a pre-developed solution, you don’t need to worry about its creation. You can concentrate on what is more important — content. 

Content is king. It is the first thing people chase in the video streaming landscape. They want to watch quality content, whether entertaining series and movies or educational tutorials. 

In the end, marketing is what will help you attract viewers to your service. Marketing is about informing people about your service and why they should watch it. Invest in channels that your target audience is likely to use.

Drawing the Line

OTT changed the broadcasting industry tremendously. With its capabilities, viewers get more control over content consumption, and businesses produce their own content to monetize it. They share their expertise, create educational videos, or make movies and series. 

With OTT, you can stream VOD content or opt for live meetings with your viewers — whatever suits your business model. Don’t forget to invest in marketing, content creation, and technology to ensure the success of your streaming service. Use analytics to enhance it step-by-step.

Leave a Reply

Your email address will not be published. Required fields are marked *