An increasing number of companies are joining the market, launching their own fresh online streaming services, and vying for the top spot among streaming service providers as the demand for video streaming services keeps rising. Getting top-notch OTT content to stock their platform and make it available to users is one of the biggest problems facing any (particularly emerging) video streaming business.

We’ll talk about a few methods in this article for getting content for your video streaming business.

To provide customers with material, streaming services use a number of different parts and procedures. This is a general rundown of how streaming functions:

• Content Storage and Hosting: Streaming services store their content on servers or cloud-based storage platforms. These servers host the media files, such as movies, TV shows, or music, that users can access and stream.
• Content-Encoding and Compression: Before streaming, the media files are encoded and compressed into various formats suitable for online streaming. This process reduces the file size while maintaining an acceptable level of quality. Different streaming protocols and codecs encode the content, such as H.264 or H.265 for video.
• Content Delivery Network (CDN): To efficiently deliver content to users, streaming services often utilize Content Delivery Networks. CDNs consist of a network of servers distributed across different geographic locations. These servers store copies of the content and help reduce latency by delivering the content from a server closest to the user’s location.
• User Devices: Users access streaming services through various devices, including smartphones, tablets, smart TVs, gaming consoles, and computers. These devices need an internet connection and a compatible streaming application or web browser to access and stream content.
• Internet Traffic: When a user selects and starts streaming content, the streaming service sends the requested media data in small packets over the internet. These packets travel through the user’s internet service provider (ISP) infrastructure to reach the user’s device.
• Adaptive Bitrate Streaming: Streaming services often employ adaptive bitrate streaming techniques. It means that the quality and bitrate of the streamed media can dynamically adjust based on the user’s internet connection speed and device capabilities. It ensures a smooth playback experience by adapting to changing network conditions.
• Content Delivery Algorithms: Streaming services use sophisticated algorithms to determine the most optimal way to deliver content to users. These algorithms consider available bandwidth, device capabilities, network conditions, and user preferences to provide the best streaming experience.
• User Experience and Interface: Streaming services provide user-friendly interfaces where users can browse and search for content, create playlists, and manage their preferences. Recommendations and personalized content suggestions based on viewing history and user preferences are often incorporated to enhance the user experience.

Overall, streaming services rely on a combination of storage, encoding, content delivery networks, internet infrastructure, user devices, and algorithms to deliver a seamless streaming experience to users across a variety of devices.

How do Streaming Services Pay For Content?

Leasing content or forming alliances with content producers is one of the best ways to acquire over-the-top content for your TV or video streaming service. Major studios, networks, and independent producers and distributors can all fall under this category. These collaborations can give you access to a variety of well-liked films and television series in addition to unique streaming media that is exclusively accessible on your platform, such as content for video streaming services.

Although this could be a more costly choice, it can give you access to well-known and well-liked content that could draw more users to your platform. To make sure you are getting a fair bargain and that the material aligns with your brand and target audience, make sure you thoroughly investigate and negotiate licensing agreements.

Make sure there is a steady stream of fresh content, regardless of how you obtain it, to keep your subscribers interested. Additionally, confirm that the content justifies the price consumers are paying.

Licensing OTT video content for video subscription services involves the negotiation and purchase of the rights to broadcast certain media, such as movies, television shows, and music, over the Internet.

The process of licensing content for best streaming applications typically begins when a streaming service expresses interest in acquiring the rights to a particular piece of content. The content owner, such as a movie studio, will then negotiate the terms of the license with the streaming service, including the duration of the license, the territories in which the content will be available, and the fee that the streaming service will pay for the rights.

Read Also: What Are The Types of Electronic Payment Systems?

There are several business models that content sellers may offer to IPTV or OTT operators when buying content from them. Some of the most common models include:

Subscription-based model

In this model, the operator pays a monthly or annual fee to access the content. The content is typically locked behind a paywall, and only subscribers have access to it.

Pay-per-view model

In this model, the operator pays for each piece of content that is viewed. This is often used for live events or one-off programming.

Advertising-based model

In this model, the operator receives the content for free but must include advertisements within the content. The revenue from the advertisements is shared between the operator and the content seller.

Transactional video-on-demand (TVOD) model

In this model, the operator pays for each piece of content that is purchased or rented. This is often used for movies or TV shows.

Hybrid model

A combination of the above models. For example, a subscription-based model with ads, or a pay-per-view model with a subscription.

White Label

This option allows the service provider to use the content seller’s platform and infrastructure, and to brand the service as their own. This allows service providers to offer VOD services to their customers without having to invest in the necessary technology and infrastructure.

Not all content creators are created equal

It’s important to note that the content sellers may have different pricing and terms for each of these models, and that the choice of the right business model will depend on the specific needs of the IPTV or OTT operator and the type of content being offered.

It’s worth noting that content sellers can also offer different pricing models, like revenue share or flat fees. In revenue sharing, the service provider and the content seller will share the revenue generated by the content, while in flat fees the service provider pays a fixed amount for the content. The most common model is to pay a fixed amount for the content per month or per year.

How to Acquire Content

Directly from content creators

This could include major broadcasters, cable networks, and other providers of TV programming. By negotiating directly with content creators, you may be able to secure rights to their programming at a lower cost than through other means.

From aggregators

There are companies that act as intermediaries between content creators and service providers. These aggregators package content from multiple sources and sell it to IPTV and OTT providers as a bundle.

From consultancy agency

Some consultancy agency helps a company to create and negotiate contracts with content providers.

From tech vendors

Some IPTV and OTT service providers purchase turnkey solutions from tech vendors. These solutions include not only the technology infrastructure to deliver the content but also the content itself, which is often sourced from a variety of providers.

In addition to the options mentioned above, there are a few other ways to acquire content for an OTT or IPTV service. Please be aware that getting streams from the sources below does not mean that you have automatically secured content rights. So always check with your content source and with the content owner if you have sufficient content rights and to what extent.

Other potential sources of content can be:

From other service providers

Some OTT and IPTV providers have agreements in place to share content with one another. This can be a good way to secure rights to a wider range of programming without having to negotiate with every individual content creator.

Through content distribution platforms

There are platforms that provide a marketplace for content providers to list their programming and for service providers to search for and purchase content.

From local content providers

Depending on the country or region in which your service is being offered, there may be local content providers that produce programming that is specific to that area. Negotiating deals with these providers can be a good way to differentiate your service and appeal to a local audience.

From over-the-air broadcasting

Service providers can use their own antenna and tuners to capture free over-the-air signals and then retransmit those channels over the Internet or via cable to customers.

How do Streaming Services Make Money?

Streaming services can employ several strategies to make money:

• Paid Subscriptions: Most services offer delivered subscriptions to their users. Users pay a monthly or annual fee to gain access to the content. Companies may offer different subscription tiers, providing limited or enhanced access.
• Advertising: Some services incorporate advertisements that play before, during, or after video playback. In some cases, users can purchase a subscription that removes ads.
• Product placement: As a prime example, we can point to Apple’s prowess in product placement. The company showcases its own devices in the hands of beloved characters. For example, in Apple’s top-rated series ‘Ted Lasso’, you can spot around 300 iPhones, 40 pairs of AirPods, and 120 MacBooks across 74 episodes. Other companies’ products, such as Nike and Doritos, also appear in Apple originals. Additionally, the company charges users for subscriptions.

In summary, streaming services generate revenue through paid subscriptions, advertising, and native advertising by leveraging their content and user base.

Streaming services can establish partnerships with large and small businesses to attract a more extensive subscriber base. For instance, Netflix collaborates with stand-up comedians, YouTubers, and film producers to bring more popular content to their platforms. The most profitable ventures are original shows that, if they gain popularity, leave users with no choice but to subscribe to a specific service.

Streaming services continuously evolve and explore new strategies to become even more successful. What lies ahead for them in the future?

The future of streaming services promises development and evolution, but it’s challenging to predict precise scenarios and directions of growth. Nevertheless, there are several trends and potential strategies that could shape the future of streaming:

1. Universal Global Network: With the development of internet infrastructure and increased accessibility to high-speed internet, there may be a universal global network of streaming services. It would allow users from different countries and regions to access a shared content library without restrictions based on geographical location or licensing differences.
2. Greater Content Diversity: Streaming services will strive to offer even more diverse content, ranging from original series and movies to sports events, live broadcasts, news, and music concerts. The advancement of technologies such as virtual and augmented reality may also introduce new formats and possibilities in streaming content.
3. Interactive Content: The future of streaming may include more interactive content, where viewers can engage with the content and actively participate in the viewing experience. Interactive content could involve choosing alternative endings, influencing the storyline, participating in reality shows, or virtual interactive events. Such content already exists. Netflix released an interactive episode of the series ‘Black Mirror’ called ‘Bandersnatch’, where users could make choices for the character’s actions and explore multiple endings.
4. Improved Delivery Technologies: Advancements in data transmission technologies, such as faster internet speeds, enhanced video compression, better image and sound quality, and improved adaptive streaming, will help provide a better streaming experience for users.
5. Personalization and Recommendations: In the future, streaming services may become more intelligent and capable of offering more precise recommendations and personalized content based on each user’s preferences and interests.

Conclusion

Acquiring exclusive rights to content can also be a costly endeavor for streaming services, as they may have to pay higher licensing fees to content owners in order to secure exclusivity. In addition, streaming services may also face competition from other platforms that are also seeking to acquire exclusive rights to the same content.