It’s hard to beat Netflix in terms of popularity. However, it is not the only content streaming service around.
Hulu, Amazon, Disney+, and others have found their niches. Does it mean you can repeat their success? Well, why not, if you choose the right strategy.
How Much Does It Cost To Build a Streaming Service Like Netflix
Let’s review the main stages you’ll have to go through and try to figure out the total cost of the project.
How Does Netflix Work?
While we are speaking not only about Netflix, we’ll take it as an example, as it illustrates the functioning of streaming services well.
It provides on-demand video to its subscribers for a monthly fee. Once paying this fee, a user gets unlimited access to content from almost any device.
A lot of extra features let customize the app and add convenience.
How to Make an App like Netflix
Developing a streaming service from scratch is a complicated process.
No matter whether you are looking for how to make live streaming app or a website like Netflix, Here are six main steps you’ll have to go through.
- Select a niche. Of course, you may try to seize the unseizable by pleasing all types of viewers. But this goal seems too ambitious and hard to achieve. After all, you’ll hardly ever be the second Netflix. That is why it’s important to focus on certain types of content and try to become the best of the best in your narrow niche.
- Make a content plan. At this stage, you need to decide how and under what terms you will provide content. For example, decide how often you are going to add new content, whether you are going to provide something for free or not.
- Get a license to comply with the law. You may rent content directly from the content owner (copyright holder) or an official distributor. This is one of the main expense item, so double check what, why, and under what terms you are renting.
- Choose design. At this stage, you’ll need to decide between a ready-made template and developing a unique style from scratch. The latter option is preferable, though developing unique design is, definitely, pricier.
- Think of compatibility with different platforms. If you want to stay competitive, you should consider creating both web and mobile apps. Also, don’t forget about adaptive or responsive design.
- Attract your target audience. Once you’ve determined your target audience, use various promotion tools to let them know about your product and its benefits. Popular promotion channels are YouTube, social media, and email marketing.
Developing an app like Netflix is half the battle. On the next stage, you will have to think about a business model to make the most of your product.
Choosing a Business Model
Needless to explain, the mere fact of creating an app like Netflix won’t make you a millionaire overnight.
You’ll have to work hard to make your product profitable. In particular, you’ll need to develop a business model thoroughly.
Here are the main things to consider.
The main model of monetization for video streaming platforms is the subscription model where users pay a monthly (quarterly, yearly) fee according to their subscription plans.
Other possible models are video purchasing an advertisement.
The chart below displays the most popular monetization models depending on the type of the content streaming platform.
Customer Lifetime Value
It’s important to understand the concept of the customer lifetime value (CLV) and be able to calculate it for your customers.
In a nutshell, this concept says that you shouldn’t be afraid of losing money on your customers in a short-term perspective if these customers will bring you profit in a long-term perspective.
Increasing the CLV
There is one simple rule: to make customers buy more services you should keep them active.
Track each client, study his/her behavior, and offer new activities regularly.
This method is widely used by Netflix, which reduced the outflow of its customers by 4%.
Marketing is important but don’t go overboard with it. A well-thought marketing campaign is the key to success.
You need to understand that clients come from various channels, and your goal is to estimate the lifetime value of each group to decide how much you can spend on each channel.
The Tech Stack for Developing a Content Streaming Platform
The tech stack includes programmer tools (programming languages, frameworks, templates, and software) used to create the desired product.
In the chart below, you can see an approximate set of programming languages used to build some popular platforms.
Developing a website like Netflix takes long.
To speed up the process developers often use special third-party services.
Some examples are in the following chart.
While these third-party services are really useful, they often don’t come free of charge.
Here are approximate prices for using some popular tools.
An MVP for an App like Netflix
To launch a streaming platform you should create an MVP (minimal viable product) first.
Its cost largely depends on the development time, which, in turn, is determined by the feature set and the number of platforms.
In the chart below, you can see average prices based on an hourly rate of $50.
As for the number of platforms, of course, best of all is to make your service compatible with all existing platforms.
However, when it comes to developing an MVP, you may start with a single OS – Android or iOS.
Choose the one that is more popular in your target region.
Basic features for a minimal viable product include the following ones.
- User registration is a feature that your service can’t exist without.
- Payment gateway. Customers will need to make payments without hassle.
- User profile. This feature helps users save searches, add “favorites”, and manage content in other ways.
- Search filters. For the sake of convenience, it is recommended to add several search options: by genre, by actors, by ranking, by user reviews, etc.
- Comments and user chats. They help customers exchange opinions.
- Push notifications. Let users know about the new series or episode availability.
- Settings. This is a mandatory feature, which lets customize a user profile – change the language, adjust volume, etc.
- Screenshot blocking. This feature is available for Android OS and protects the copyright.
- Administration panel. You need it to manage both content and users.
If an MVP version of your project met or exceeded your expectations, you may want to develop a full-featured service with an expanded feature set.
An approximate price of such a platform development is displayed in the chart below.
Additional features can include the following ones:
- signing up via a social media account;
- adding reviews and stars;
- live broadcasting;
- recommendations of content;
- the possibility of downloading;
- video quality.
These features are not mandatory, but you may add them if you wish.
Important Requirements to Consider
Once your streaming app is created, make sure it complies with basic requirements to platforms of this type:
- a reliable content storage (e.g. cloud-based);
- stable connectivity;
- enough bandwidth;
- high security;
- the right video streaming protocol.
To Sum It Up
Developing a good content streaming service from scratch is an ambitious and complicated task with many things to consider.
The total development cost depends on two key factors: the number of hours required and the hourly rate of a developer team.
For an MVP version, an approximate development time varies from 1000 to 1500 hours.
Developing a full-featured product takes from 1500 to 3000 hours. Thus, with an hourly rate of $50, the cost of an MVP version can reach $50 000 – $70 000.
A service with an expanded feature set costs $115 000 – $134 000.