The average cost of developing an OTT app ranges around $25,000 to $300,000. But there’s more to uncover which you must know to plan a perfect budget otherwise you will end up spending a lot of money. Knowing everything related to OTT app development cost is necessary to make an informed decision about building your app.
Before diving deep into the budget, it’s important to understand the OTT (over-the-top) industry properly. The OTT industry is growing rapidly because OTT apps provide huge benefits to users by allowing access to exclusive content at a budget-friendly price and within the comfort of their homes.
The OTT app market has a lot of scope for newcomers because it has grown massively since COVID-19. According to Fortune Business Insights, the OTT market was valued at $59.90 billion in 2023 and it is expected to reach $229.97 billion by 2032. Businesses, that are thinking of launching an OTT app, can maximize their revenue and unlock the doors of growth.
So, if you are a startup or enterprise planning to create ott platform to enter this growing industry, then understanding the OTT app development cost is crucial. After knowing the cost, you can plan your budget properly and start your app development journey without any worries.
In this blog, we’ll cover the OTT app development cost along with the formula of estimation, and factors affecting the actual cost. After reading this blog, you’ll have a better understanding of the cost which is essential to make informed decisions about building a custom OTT platform. So, let’s start with;
Table of Contents
How to Estimate OTT App Development Cost?
A formula is very popular in the industry which is used to estimate the cost of any type of application. You can also use this formula to know the cost of developing an OTT streaming app. Businesses can use this basic and widely-known formula that several entrepreneurs use to get a fair estimation of developing their desired app. This formula is being used by popular OTT app development companies. It is basic but it can give you a good cost estimation which is important to plan a budget. Check out the formula;
Total Development Cost = (Total Development Time in Hours) x (Hourly Rate) + Additional Cost
This OTT app development cost formula has two major components that have a complete influence on the overall cost. These components are ‘total development time’ which is calculated in hours and the ‘hourly rate’ that developers take to build the application.
Factors Affecting OTT App Development Cost
The cost of developing a custom OTT app can be impacted by several factors. We’ll discuss all these factors that you should know to make a perfect estimation. The complexity and functionality of the application are important because the features are the main reason for increasing costs.
Choosing a platform is also essential because launching a separate app for Android and iOS can be very costly. These are only some factors. We need to take a look at all the factors to understand the process properly. So, let’s explore these factors;
1. Functionality of the Application
The most important factor that impacts the OTT app development cost is the complexity of the features that should be implemented in it. If your app gets complex, then the cost of building OTT apps increases a lot. However, you can optimize the OTT app development cost by building a Minimum Viable Product (MVP).
It contains various basic functionalities such as multilingual content, user profile optimization, social features, screen reflecting, payment gateway, and content management. MVP will help you validate your idea and receive feedback to make changes to the app. Choosing an MVP also helps in boosting the OTT development process.
2. Platform and Devices
There are several platforms and devices for OTT apps and these platforms should be used to provide a seamless user experience to your target audience. Building separate apps for Android, iOS, web, desktop, and TVs can be very costly because it requires an additional framework for customizing, and testing the app on each platform. It also makes the OTT platform development time-consuming.
Developing separate apps for each platform can be very costly so you can choose to build a cross-platform application. They can provide you with better performance and user-centric experiences. However, different screen sizes and resolutions play a role in affecting the cost but they don’t make a huge impact.
3. Content Management and Streaming
Streaming technology and a strong content management system are the cores of an OTT application. An effective content management system includes features such as easy uploading, categorizing, and proper management of apps.
Additionally, streaming technology is essential to provide a smooth viewing experience depending on the excellent internet speed. The use of high-tech streaming technology and content management systems increases the cost of developing OTT software.
4. UI and UX Design
The design of custom ott solutions plays an important role in acquiring new customers and nurturing the older ones. If you want to add appealing, user-centric, and attention-grabbing designs then you will need the expertise of an experienced designer with deep knowledge of UI/UX designing.
This addition will also increase the cost. Choosing a basic design and experience can provide a bad experience to the users. You need to choose the custom design within limited resources to provide the best experience to your users. It will be cost-saving and your users will be happy as well.
5. Regulatory Adherence
You need to adhere to the regular security and privacy protections which also results in increasing the cost of developing the OTT software. Reliable security and regulatory adherence require data encryption, digital growth optimization, compliance with privacy laws, content management, and privacy protections.
Protecting the content from third-party access and piracy is a crucial aspect of OTT app development. To save the content from third-party access, you need to use the content delivery network for secure delivery, watermarking to deter piracy, and secure streaming protocols to minimize vulnerabilities. However, some of these things are costly but they are common to save your application and acquire new customers.
These are some important factors that impact the cost of developing your desired OTT app. You need to know about these factors to make an informed decision. Knowing about them helps you budget accurately, prioritize features, and negotiate with developers or companies. By understanding the impact of these factors, you can allocate the resources properly depending on your needs.
OTT App Development Cost Breakdown: Based on Features And Components;
The estimated cost of developing an OTT app ranges from around $25,000 to $300,000 with simple features like user authentication, content library, video player, search and discovery, and multiple user profiles.
If you wish to include some advanced features like AI-powered recommendations, voice search and control, and adaptive bitrate streaming, then the cost of development can be increased and make a hole in your pocket. Let’s understand the breakdown of the OTT app development cost to know about the cost of different features and components.
Component | Details | Estimated Cost |
Platform & Device Compatibility | Developing the app for each platform (iOS, Android, Web, Smart TVs) | $10,000 – $25,000 |
UI/UX Design | Create a custom, appealing design to provide a seamless experience | $5,000 – $15,000 |
Content Management System (CMS) | Manages the content upload, scheduling, and access control | $5,000 – $20,000 |
CDN Integration | Provides smooth, high-quality content delivery using a Content Delivery Network | $1,000 – $5,000 |
Streaming Quality & Video Encoding | Supports several resolutions to provide a high-quality and personalized streaming experience | $5,000 – $15,000 |
Security Features | Include secure login, and data encryption and provide Digital Rights Management (DRM) | $5,000 – $15,000 |
Payment Gateway Integration | In-app payments, subscriptions, and multi-payment solutions | $3,000 – $15,000 |
Personalization & Recommendations | AI-powered recommendations, watchlists, user profiles | $10,000 – $25,000 |
Analytics & Reporting | Real-time tracking of user engagement and performance monitoring | $2,000 – $8,000 |
Testing & Quality Assurance (QA) | Load testing, testing on several devices to check stability | $5,000 – $15,000 |
Post-Launch Maintenance | Ongoing updates to ensure the app works smoother for a long time | $1,000 – $4,000 per month |
Overall, building a basic OTT app costs around $25,000 to $50,000, a mid-range OTT app costs around $50,000 to $100,000 and a high-end OTT app can be built in between $100,000 to $300,000 or more.
Wrapping Up
After reading this blog, you must have understood that the average cost of developing an OTT app ranges from around $25,000 to $300,000. However, some crucial factors can influence the cost. However, you need to partner with a reputed OTT app development company to build a feature-rich OTT app.
A well-known app development company can provide advanced OTT app development services to meet specific business goals. RipenApps is an award-winning OTT app development company. We specialize in building smart OTT apps that provide unmatchable user experience and seamless performance.
FAQs
Q1. What is OTT App Development?
OTT app development is the process of developing an OTT app that allows you to reach a global audience. These applications deliver media content such as video, audio, and live streaming directly to users with the use of the internet.
Q2. Is OTT profitable?
Yes, OTT is profitable because the platforms follow revenue models to generate money. These models are; subscription-based revenue, advertising revenue, in-app purchases, and premium content.
Q3. Which is the richest OTT platform?
As of 2024, Netflix has emerged as the richest OTT platform because it offers the highest-rated services and world-class content. Some businesses follow the approach of Netflix app development to repeat its success.
Q4. How long does it take to develop an OTT platform?
The development time of an OTT platform depends on several important factors such as complexity, tech stack, and development process. However, a basic OTT app takes approximately 6 months to build.