How do OTT apps work?
OTT (Over-the-top) applications use the Internet to deliver content to the user, bypassing traditional distribution channels such as television and radio. OTT apps simplify content consumption by allowing customers to choose what they want to watch. These apps are made with UX in mind and are developed for multiple device types at once, including smart TVs, making them highly accessible.
To generate revenue, most OTT streaming platforms use a subscription-based monetization model. The model allows tiered pricing plans, free trials, and dynamic pricing to fit different budgets and viewer habits. Therefore, it can be easily customized to fit any business and audience.
Examples of popular OTT apps include Netflix, Hulu, and Disney+
So, now that we’re familiar with the basics of OTT apps, let’s look at the bigger picture and explore how OTT services became popular in the first place.
When were OTT apps first introduced?
The year 2005 saw the release of the most popular video-sharing website, YouTube, which transformed the content delivery landscape. While it’s not typically considered an OTT service, the platform has popularized watching online video content. YouTube also offered useful features that were later adopted by other OTT apps, such as smart recommendations and watchlists.
In 2007, the movie rental service Netflix launched its online streaming platform, becoming the first prominent OTT video app. This new format proved so successful that Netflix decided to shift all focus to video streaming services, abandoning their old DVD rental model. Since then, streaming services have only grown in popularity, becoming a pillar of modern entertainment. Let’s shift our focus to the present day and go over what OTT platform development involves.
By 2010, Netflix has fully embraced its online streaming features, gradually moving away from the outdated DVD rental model
What does OTT app development involve?
To create a successful OTT app today, you need to have the right approach. Here are the 3 most important things you need for app development:
An original content strategy
Popular OTT services have extensive content libraries that are updated regularly. Focus on building an original content portfolio to stand out from the crowd.
A solid technology stack
An OTT app is only as good as its video streaming quality. Invest in expanding your technology stack to create a competitive and reliable streaming app. Common OTT app development tools include ReactJS and Flutter.
High-quality UI/UX design
An intuitive user interface will make your app easy to use and help increase engagement. Focusing on the design of your app is essential to your project’s success.
Why start OTT app development?
In 2023, the number of users of streaming services reached 4.5 million people, and these applications have already been developed even for smart TVs.
Creating a video streaming app in 2025 would be a good idea for several reasons:
- streaming services already have a larger audience than traditional media channels and will only continue to grow;
- it’s relatively easy to deliver your content to viewers all over the world;
- OTT apps are easy to monetize due to the abundance of monetization models available.
To help you understand the full potential of OTT applications, let’s take a look at their advantages over traditional platforms.
What are the advantages of OTT apps over standard platforms?
Compared to conventional TV, OTT apps use modern technology to the fullest extent, allowing them to boost user engagement and increase profits. Take a look at our side-by-side comparison and see for yourself:
| 💻OTT platforms | 📺TV | |
| ⚡ User engagement | Interactive and easy to use; offer exclusive content to attract users | Low user engagement due to the lack of interactivity and limited exclusive content |
| 👥 Audience reach | Can target specific niches by analyzing user behavior | Allow you to reach a wide audience, but you still wouldn’t be able to target specific audience niches |
| 🔋 Cost-effectiveness | Licensing fees can be high, but budget modeling is more flexible overall | Working with major TV networks often involves additional expenses |
| 👋 Accessibility & convenience | Content can be easily accessed on any platform, including smart TV devices; users control video playback | Limited device compatibility; viewers have to sit through commercial breaks |
| 🍱 Content variety | Known for extensive content libraries | Limited choice of content |
| 💸 Monetization options | A wide range of monetization options, including subscriptions and in-app purchases | Advertisements are the primary revenue source; cable TV networks offer subscriptions, which are becoming less popular |
| 👀 Analysis of user behavior | Online features allow us to analyze user behavior down to the minute detail | Don’t give a lot of insight into user behavior; provide limited viewership data |
Now, let’s shift gears and look at the current OTT platform development market.
Overview of today’s OTT market
The market for video streaming platforms is steadily growing every year. According to financial analysts, the global OTT video market is expected to reach $316 billion by the end of 2024. The pandemic, along with improved global internet coverage, contributed to the growth of streaming services. Increased content production over the past few years has helped attract new audiences to the OTT platforms. The growth of video streaming services shows no signs of stopping, and their subscriber numbers reflect that.
Subscriber growth of Netflix from the start of 2019 to the end of 2023 (in millions).
Source: Business of Apps
When it comes to subscriptions, Netflix is still the top player in the OTT market, followed by Amazon Prime Video, Disney+, and HBO Max. Among all the OTT platforms, Netflix has the most subscribers: by early 2024, that number had exceeded 260 million, according to Digital Trends. Some attribute that growth to the platform’s longevity, as it’s the oldest video streaming app around.
With that said, the number of canceled subscriptions is also rising. According to Forbes, 45% of users in the US canceled at least one streaming subscription in 2023 because of increased costs. Subscription fatigue is a real thing, and we’ve yet to see how it affects OTT platform development in the long run. Still, the overall market trends are encouraging, and OTT development has never been as lucrative as now. But how do you decide on the type of content your OTT app will offer? We’d like to help you with that. Next, let’s explore the types of OTT services.
How to choose the type of OTT services for your app?
When it comes to creating a modern streaming app, you don’t have to focus on video content — the OTT industry leaves plenty of room for different content models. Here are the 3 main types of content for OTT streaming platforms:
📽 Video
Providing video content is the most common OTT business model. The biggest OTT apps offer huge catalogs of movies and shows that include completely original content.
🎶 Music
Audio streaming services such as Spotify and Apple Music have breathed new life into the global music business. A music streaming service focused on a wide range of genres and personalized playlists that are based on listeners’ behavior, has every chance to succeed.
🎙 Podcasts
The podcasting industry is bigger than ever, and creators rely on many platforms to distribute shows. Today, an original podcasting platform has every chance of succeeding.
To decide on the content type for your OTT app, look at your target audience, consider different monetization strategies, and factor in licensing costs. Now let’s look at the most important features to include in an OTT app.
6 essential features to include in OTT platform development
The most successful streaming services offer a wide range of useful features to entice their customers. If you want to keep up with the best, consider implementing some of these features in your video streaming app:
1. Smart search & recommendations
Netflix was the first video streaming app that introduced smart recommendations, suggesting video content based on users’ preferences
Nowadays, every prominent OTT video streaming app has smart recommendation algorithms. With this feature, users will be shown content based on their preferences, which means no need to waste time choosing what to watch. The more comfortable it is to use your app — the higher the chance of keeping the user. Personalized recommendations are an essential component of any successful video streaming app, so we recommend focusing on it during OTT development.
2. Watchlist
Amazon Prime Video allows users to add any show or movie to their watchlists
Film enthusiasts know watchlists are convenient for keeping track of your movie backlog. Integrating personal watchlists into your OTT app is an effective way of encouraging users to watch more, fostering their passion for movies.
3. Offline mode
The Disney+ app allows users to download movies or shows to any device and watch them offline
Though watching movies on a smart TV is a more immersive experience, many prefer watching content through mobile apps, opting for convenience and flexibility. Some popular OTT streaming platforms allow users to download video content and watch it on the go, which makes these apps even more convenient. If you want to attract as many users as possible, implement this feature in your OTT app development process.
4. Rating system
Amazon Prime Video collects movie ratings from IMDb and presents them to users
While searching for new video content, people often look at reviews and ratings to decide what to watch. Creating a simple and transparent rating system for your OTT app can help it gain traction among movie fans and reviewers, boosting its popularity.
5. Interactive elements
Netflix has produced more than 20 “interactive specials” — films with branching narratives that allow viewers to change how the story progresses
Movies, by nature, aren’t very interactive. Some OTT streaming platforms are experimenting with the traditional format, introducing interactive elements into their films and shows. People are more interested in interactive content than ever, and Netflix is even trying to break into the ever-growing gaming industry. Including interactive features in your streaming app can help you attract other audiences who are more used to playing games than watching movies.
6. Behind-the-scenes content
Apple TV offers bonus content for some of its exclusives, giving users an inside look into their favorite movies and shows
Movie fans prefer learning as much as possible about the film-making process, so they always appreciate bonus content like behind-the-scenes featurettes or filmmaker interviews. Offering your viewers additional content as part of your streaming catalog can help increase user engagement and boost your app’s reputation.
Now that we’ve looked at the most essential features for OTT platform app development, let’s get into the best monetization strategies for your streaming app.
Best monetization types for OTT app development
There are a lot of ways you can approach monetizing your OTT video streaming app. To help you choose, we’ve outlined the most common monetization strategies for OTT platform development:
SVOD
Subscription video on demand, or SVOD, is the most common monetization type for OTT apps. OTT video subscription revenues are rising every year, and SVOD has become the gold standard for delivering video content. The streaming services that use subscription video offer their viewers unlimited access to content libraries in return for monthly payments.
AVOD
Advertising video on demand, or AVOD, is a monetization model that involves offering free video content with integrated ads. Unlike streaming services that use the subscription video model, an AVOD streaming app relies on ads to generate revenue. Free-to-use platforms tend to favor this monetization type — it allows them to expand their audience reach without losing revenue.
TVOD
Transactional video on demand, or TVOD, involves selling or renting video content to users. Viewers either make one-time purchases to own the content forever or rent it for a fixed period. Out of all OTT monetization types, transactional video on demand is most similar to the old DVD rental model.
So, now that we’re familiar with the inner workings of modern OTT services, let’s explore OTT development in earnest.
8 steps for developing a successful OTT app
The OTT app development process is divided into several steps and can vary depending on the feature set in your OTT video app. Here are the 8 most important stages of video streaming app development:
1. Define your target audience
At the start of your custom OTT app development project, focus on defining your target audience. The needs of your clients will dictate what type of content your app will offer, as well as its features. For example, if your app will serve primarily younger people, then it makes sense to prioritize modern features like AI integration and interactivity. But if you want your app to have universal appeal, investing in a diverse content library is a must.
2. Come up with a content strategy
Providing your customers with varied content will help your app stay relevant over time. When it comes to video content, there are a lot of options besides movies and shows. As part of your video on demand catalog, you could offer documentaries, sports events, music concerts, and short films. There’s a lot of room for creativity in video streaming app development, and standing out from the industry leaders is essential to success.
3. Develop a design philosophy for your app
Apple’s minimalistic approach to design is well-known, and their video streaming app uses it to impressive effect
Creating a recognizable style for your streaming platform is an essential part of OTT development. The app’s design should complement the main features of your streaming service, making them more visible to users. Designing an intuitive user interface will go a long way toward making your app more accessible. If done right, it can even increase the OTT video subscription revenues.
4. Choose a monetization strategy
Platforms like YouTube earn the majority of their revenue through ad-supported content, which includes movies and shows
Outlining the primary revenue streams of your app is crucial. Whether you prefer subscription video on demand or another monetization model, it can’t hurt to experiment. Focusing on two separate monetization strategies can be worthwhile if you can find an effective way of combining them within one app. For example, you could provide free content with ads and offer premium content as part of a subscription.
5. Find a professional team of OTT app developers
By this point, you’ll have a good understanding of what features your app will offer. The next order of business is to find a competent team of OTT app developers. You can either build a development team from scratch or look for a specialized OTT app development company. To make project management easier, we recommend enlisting the help of an experienced team that provides OTT app development services.
6. Plan out the technical foundations of your app
After assembling a team, it’s time to plan out the technical aspects of app development. To ensure that your app provides a smooth viewing experience upon release, choose the right development tools.
The most crucial part is building a content delivery network (CDN). A well-developed CDN will allow your streaming app to remain stable and handle increased demand from viewers.
Besides that, a CDN caches the most important content to reduce loading times on the user side. A solid CDN can also improve the accessibility of your streaming service, handle server failures, and protect the app from external threats. All of that means that your streaming platform will be as good as your content delivery network. It’ll serve as the foundation of your app, so focusing your efforts on developing a reliable CDN is a smart choice.
7. Develop and release your app
The app development process can be long and complicated. Development time will depend on the number of advanced features your app will include, as well as your team’s expertise. When your team is finished with app development, you’ll need to release your streaming service.
When approaching release, make sure you have a solid marketing strategy to promote your app. Such strategies often involve using all the available promotional platforms, including social networks, email newsletters, and ads.
Mobile apps rely on app stores for promotion, so try to get your app featured on the main page of app stores to boost app discovery.
8. Update and support your app
Looking at how your clients interact with your streaming service can give you insight into how to support your app. OTT apps require frequent content updates to stay in the spotlight and keep the users’ attention. Besides adding new movies, shows, and other video content to your platform, think about what new features you could implement in your app to attract new clients. Hopefully, our list of essential features for OTT platforms has inspired you to experiment with new functionality for your app.
What affects the cost of OTT app development?
Accurately estimating OTT app development costs is only possible if you take crucial factors into account like feature scope, content licensing, monetization, and more. Let’s discuss the most important aspects of OTT platform app development that affect the total project cost.
Scope of features
The complexity of your OTT video streaming app will influence the overall cost. If, during app development, you’d like to focus on advanced features like interactive content or 360º video support, your budget should account for that. The more features you include in your OTT video app, the higher the app development cost will be.
Content licensing fees
All popular video streaming platforms rely heavily on their content libraries to attract customers. Content variety is the most crucial component of OTT video streaming, but it doesn’t come without a cost. Getting the rights to stream movies or shows can be expensive, depending on the content producer or distributor. The more content you want to host on your app, the more you have to pay.
Number of platforms for app development
OTT platform development involves building apps for many platforms at once. To engage their viewers, OTT video streaming companies create mobile apps, and smart TV apps, and invest in platform accessibility in general. When planning your OTT video streaming service, consider investing in cross-platform app development tools to gain access to a wider audience.
Now let’s get into the final section of our guide, where we’ll offer some general advice about OTT development.
Recommendations and best strategies for OTT app development
Starting a video streaming app development project from scratch can be intimidating. To find your footing in the OTT development space, check out our final recommendations for creating a successful streaming app:
🎨 Stand out and be original
Today’s OTT market is highly competitive, and offering your clients unique functionality is essential to your app’s continued success. To ensure that your streaming platform stands out from the crowd, come up with distinctive features for your app. Examine your competitors and outline the weak points of their streaming platforms. To make your service stand out, offer exclusive content, better subscription prices, or advanced features like AR integration. When it comes to OTT development, the recipe for success is constantly changing, so your creativity will be your best asset.
💡 Improve and innovate
You can watch Netflix on a VR headset to simulate the movie theater experience
Even if your streaming service is successful at launch, it could quickly stagnate if you don’t regularly introduce new content. Continuously improving your app is just as important as the initial development process. No app is completely ideal at launch, so focus on fixing the imperfections of your platform first. Then, you can start adding new and exciting content to engage your audience. If you provide your app with regular content updates, your users will notice your persistence and draw their attention to your platform.
🧑💻 Put user experience first
In the world of app development, providing a pleasant user experience is key to impressing your audience. The easier your app is to navigate, the more users you’ll be able to retain in the long run. An intuitive user interface and smooth video playback are the most important features of a modern OTT app. Also, make sure that your streaming app has accessibility features like closed captions and audio descriptions. This will help you widen your platform’s reach, making your app accessible to everyone.
In conclusion
The OTT app development market is almost like a living organism, growing more diverse and complex each year. It’s dominated by large corporations like Netflix and Disney, and competing with them can seem impossible.
Like with any app development project, it’s important to set clear and achievable goals. And in time, your streaming service will flourish. We hope that our guide on OTT development has encouraged you and shown you the way forward.
If you need OTT platform development services, contact us. We will dive into the project and prepare a free project estimate within 48 hours.
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