The steady rise of OTT is changing how people find and consume video content. Broadcasters and publishers are looking for ways to remain relevant and efficiently distribute OTT content across the many leading OTT devices. Generally, this can be achieved in two ways. To cater to their audience’s expectations and provide them with a personalized, high-quality media experience, major content creators are offering their own, independent direct-to-consumer apps for various OTT and mobile devices. Other creators distribute OTT content via existing on-demand channels and platforms or aggregators, which saves some technological overhead on the publisher’s side, but entails certain limitations.

What are the differences between these two approaches? Let’s find out. In this article, we will present an overview of the possible outlets for video content available to content creators today, along with the advantages and disadvantages of these approaches. 

1. Direct-to-consumer (D2C) apps

To distribute OTT content, publishers can build their own direct-to-consumer apps, taking advantage of existing infrastructure (like Netflix or Disney+ apps on mobile devices). This basically means you are offering the app directly to your end audience (without the need for an intermediary like Apple or Roku).

Building a D2C app does not necessarily mean the app has to be built from scratch. As part of AWS, Amazon offers purpose-built services which power some of today’s leading streaming platforms including Netflix, Disney+, HBO Max, Peacock, Discovery+, HULU – as well as Amazon’s own Prime Video. AWS services allow these providers to deliver, monetize, and support live and on-demand media over the internet.

With Amazon’s more than 15 years of media and entertainment experience, AWS Elemental contains industry-leading services such as AWS Elemental MediaLive, a broadcast-grade live video processing service, and AWS Elemental MediaConvert, a file-based video transcoding service with broadcast-grade features. On top of that, there are more than 60 AWS Partners offering tools to support D2C and streaming workloads.

 

Android TV

Publishers wanting to get their D2C app on Android TV should follow Google’s guidelines here

Being on Google TV offers many benefits to publishers. For example, Android TV recommends content from Google-owned apps such as YouTube, YouTube TV and Google Play Movies, Google TV but also, through native integration, from more than 25 third-party apps, including Amazon Prime Video, Hulu, Disney Plus, HBO Max, Peacock and Pluto TV. 

Like most video technology companies, Google is seeking to create a one-stop app that searches for and recommends content based on user profile data. And the more apps that it can reach, the more intuitive Google TV can be.

Whether it’s a mobile or web app, there are a number of benefits for the publishers:

 

Advantages of building an own direct-to-consumer service

  • Greater control over the feature roadmap, design and availability of the app. You choose which devices will host your content via apps (iOS, Android, mobile, tablet, connected TV, smart TV’s, etc.). 
  • An opportunity to build exceptional, polished UX to better align with your brand and design philosophy. 
  • You can wow your audience with unique features like amazing content recommendations and multiple user profiles for a more personalized viewing experience.
  • Better insights and more detailed analytics to support your business decisions, programming, anticipate viewer churn, and feature roadmap. You know exactly who watched, what they watched, on which device, for how long and where they’re located. 
  • An opportunity to message subscribers directly with future offerings or discounts.
  • Deeper insights about video performance and user experience (CDN network, speed, etc.) to troubleshoot potential issues with the service. 
  • The content provider keeps all the revenue.

 

Disadvantages

  • Launching a direct-to-consumer OTT streaming service entails additional investments in customer acquisition and retention (or marketing in general). Partnering with OTT aggregators can help offset those costs. More on that below.

 

2. OTT content aggregators and channels

Just like the name suggests, content aggregators “aggregate” various types of content within a single platform –  this can include linear channels, VOD content and paid subscription video services – in one place. Certain platforms like Amazon, Apple, Roku, Pluto are good examples of content aggregators.

As consumers slowly abandon traditional pay TV (or are in the process of doing it), bundling OTT VOD services makes all the sense in the world to save them the hassle of paying for multiple services but hardly getting the most of their subscriptions. In reality, however, it’s not that simple. With aggregated OTT offerings, consumers may not end up saving money overall – their money will simply shift from one aggregated cable bill to many different subscriptions and/or bundles, but they will have a much more personalized and customized experience. 

A popular take on content aggregation is through so-called channels – a sort-of a la carte library of third-party subscription-based on-demand content. Amazon and Roku are offering their versions of channels. 

Other streaming platforms have introduced a FAST (Free Ad Supported TV) linear services using licensed content streamed as vertical content channels free to consumers. They are simply the new (OTT) cable operators.

 

Apple TV 

Apple works with content aggregators delivering content to iTunes. For a fee, they can correctly format and deliver your content to Apple’s specifications. Here’s a list of all Apple-approved aggregators.

If you meet all application requirements, you can sign up to offer your content by working directly with Apple. If you don’t meet the requirements or if you have other operational or financial needs, it may be best to work with an aggregator.

Amazon Prime Video Channels

In 2015 Amazon launched Prime Video Channels, a program allowing TV networks and video publishers to leverage Amazon’s position in the OTT distribution industry. 

From a viewer’s perspective, Amazon Prime Video Channels is a premium video subscription aggregation platform that lets users sign up for and access multiple streaming services (over 160 in total) including Showtime, HBO, Starz, AMC+.

Even companies with existing D2C services find a lot to like about Prime Video Channels. For example CBS All Access, is a new addition to Prime Video Channels. Being on Prime Video Channels drives subscriptions and consumption, said Marc DeBevoise, president and chief operating officer of CBS Interactive.

Roku 

Content on Roku devices comes from Roku partners, and each identifies using the term channel (please note that Roku also operates The Roku Channel, the company’s own channel delivering free, ad-supported TV, movies, sports, and news). Users can add or remove different Roku channels just like they would install or uninstall an app.

Some Roku channels are free, while others are premium channels (a la Amazon Prime Channels).

 

Advantages of OTT content aggregators and channels

For many content owners, distributing content via channels aggregators offers many benefits. Because of the sheer scale of these platforms, it is easier to scale your business with lower financial risk associated with user acquisition and technology. 

 

  • Amazon offers its channel partners marketing support.
  • Amazon and Roku promote partner content within its ecosystems. For Amazon, this includes banner ads on everything from Fire TV devices to IMDb.com and email notifications. For selected top networks, Amazon also commits a certain amount of ad space and spending to ensure the channels and their programming get marketed.
  • Because Amazon is a single billing outlet, content partners see lower churn with Amazon compared to what networks see on their own streaming apps – by as much as 25 percent. For example, if a subscriber is not happy with your offering, they are still unlikely to cancel the entire aggregator subscription.

 

Disadvantages of OTT content aggregators and channels

  • Relying solely on channels is incredibly short-sighted. The platform owns the viewer data and takes a substantial cut of your subscription/advertising revenue – from 30-50% initially, plus a share of all future renewal subscriptions.
  • In the case of on-demand platforms and channels (Roku, Amazon), the huge traffic comes at the cost of never really “owning” your viewers – you cannot advertise or message them individually or process their data. Reporting capabilities are minimal with just a monthly viewership or financial data and a corresponding bank deposit. 
  • Amazon is a walled garden and it’s not in their interest to encourage your viewers to sign up to your DTC app. By signing up through Amazon Channels, the subscriber will only be able to access the content through Amazon Instant Video. Conversely, if they subscribe to your content outside of Amazon (via MVPD, vMVPD or DTC app), there is no way to link the subscription to view the content on Amazon Prime Video. 

 

How to create a Roku channel?

Roku is an open-platform device which offers a freely available software development kit (Roku Native Developer Kit) for creating channels. The channels are written in a Roku-specific language called BrightScript.

Developers wanting to test their channels with a limited viewership can make the channels “private” – a code is then required to access the channel (provided in the Roku account page). 

Amidst the OTT wars between content giants like Netflix, Disney, HBO and Amazon, Roku positions itself as a neutral platform. Roku acts as a content aggregator, which means the content providers now also include Disney, Comcast, CBS, HBO and other Warner channels. For example, Roku hosts both Apple TV+ and Ama­zon’s TV programming (and gets a cut) instead of competing with these giants directly. 

Remaining independent is a smart business move from Roku – the more streaming providers arrive on its platform, the more revenue for them. 

 

Striking the balance

So, how to distribute OTT content? There is no silver bullet. It would be best to be present across all channels, on demand platforms and operate an own D2A app on all devices (web, mobile, various smart TV’s and gaming consoles). This approach, however, is not feasible financially. 

It’s best to identify your audience and align your strategy by selecting the channels, platforms and possibly developing a direct-to-consumer app that best suits your audience. 

If you’re considering launching a D2C app, drop us a line and tell us a bit about your project. At BSG, we have many years’ experience developing OTT apps for leading content providers and publishers, and will be excited to help. We are a trusted development partner that provides a best-in-class service and strategic guidance which is critical for successfully launching and managing your direct-to-consumer service, as well as syndicating your content to select channels and platforms

We will help you formulate your content strategy, determine the proper combination of vMVPD platforms and direct-to-consumer apps/devices, manage your viewers/subscribers and create a unified UX across devices that increases user acquisition, engagement and retention.


Looking for a TV app development partner?

Contact us