OTT Distribution: Breaking Down the Build vs Buy Strategies

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The logistical and financial costs associated with a DIY video infrastructure have made many companies rethink their video stack. The need to innovate and deliver exceptional user experiences means that product and development teams need to take a concentrated look at where they focus their time, money, and resources, and consider whether they can tap into existing technologies that still allow them to focus on differentiation.

The pressure to innovate leads many video teams to the critical decision of whether to build, maintain, and scale their video stack in-house or purchase from one or many software or platform providers to achieve the streaming capabilities they need. 

When it comes to this build versus buy choice, there are pros and cons to both. Below, we will compare the build versus buy decision as it relates to video platforms - specifically OTT distribution - so you can better determine what is best for your company.

Should You Build or Buy Your Video Infrastructure Platform? 

Video streaming has many development-intensive challenges inherently built into it: video players, compression, delivery, content management systems, ads, storage, CRMs, and more are all parts of the very complex streaming ecosystem.

From the consumer perspective, the needed functionality and features of a desirable video streaming experience mean that brands of all sizes have to measure up to the most popular platforms or risk a poor user experience that ultimately results in churn. 

Teams are tasked with build amazing video streaming experiences and control their innovation cycles. However, not all product teams have deep expertise in broadcast/video engineering, software engineering, and other various skill sets, making these innovation cycles challenging.

But streaming providers don’t need to be overloaded if they find the human resource challenge too cumbersome. They have another option: to use, or “buy,” existing video platforms and APIs that connect and integrate with the systems they have in place. Today, virtually all the moving pieces of a formerly disparate video ecosystem are available to complement one’s needs. 

While not all companies may fit in one build-it or buy-it bucket, it’s important to consider the pros and cons of each.

Build It: Pros & Cons of Building a Video Infrastructure In-House

By birth, the streaming industry is based on innovation. Perhaps this is why so many companies are wed to the build-it approach. For an industry that got its roots in disrupting traditional cable, much of the pros on building are versed in innovation and control.

Pros

For many, owning 100 percent of one’s IP means controlling all innovation cycles of OTT distribution. In a fast-moving, technology-reliant industry where the streaming wars get more challenging each year, having an internal infrastructure allows them flexibility and velocity to act how they want, when they want.

Developing video infrastructure in-house offers the benefit of building and investing in tech assets that create value for customers. Examples of these assets include admin panels, video players, content recommendation engines, or localization UX.

Cons

Given human capital constraints around costs and skill sets, perhaps the most common reason companies hit roadblocks with the choice to build is cost. Underestimating the total cost of ownership and management of video infrastructure can delay innovation.

At a minimum, the development team needed to build, optimize, and scale a video infrastructure includes: 1-2 backend developers, 1 UI/UX designer, 1 frontend developer, 1 project manager, and 1-2 QA specialists. This team also needs to be well versed in the various requirements of each platform, as there is great disparity across the different endpoints available for streaming video. 

Apart from human resources, lies the technologies or infrastructure needed to manage the video platform. Due to the pace at which these technologies change, resources need to be allocated to maintain or scale to keep up with demand. If your team is building this platform from scratch, there is a real risk that by the time your build is complete, it is already outdated.

Buy It: Pros & Cons of Integrating Existing Tech into Your Video Infrastructure

When you think of it, most technology heavily leverages purchasing or outsourcing for certain parts or features. For example, we used to build rack servers and storage, and now we buy into cloud providers like AWS. When we do a Google search for the weather, we don’t see a result from Google’s weather prediction radar, we see their integration with weather.com. We don’t build our own text messaging services into our software, we integrate with API services like Twilio.

As it seems, most development teams are accustomed to utilizing pre-existing integrations to focus on innovating in other areas. This is why the decision to buy has a solid case for OTT distribution.

Pros

Many of the cons of building video infrastructure in-house are the pros of buying or integrating APIs into your existing infrastructure. If we consider the innovation cycle top-of-mind for many video streaming providers, we can make a strong argument for this strategy.

For starters, if a development team no longer has to focus on building commoditized products like databases, CRUD (create, read, update, delete) application services, or customer management systems, they can use their resources for innovation cycles that help them differentiate from competitors. 

If a video API already exists to manage customers and commerce, for example, teams can benefit from that negated task and benefit from:

  • Faster time to market: This allows you to monetize your products more quickly, save on development costs, and rely on existing, proven technology from which to build.
  • Simplify and streamline distribution: Taking away one task allows your team to focus on others. With multiple video APIs already in existence, the benefits only compound, as you will leverage more integrators and connectors.
  • Scalability: With integrations, you can pay for scaling on an as-needed basis. Rather than buying more server space for customers that may never use it, you will scale up when you need and scale down when you don’t.
  • Reliability: Because you are paying for a service or services that other teams actively manage, you can rely on proven technologies that meet your demands and your viewers’ demands. This also means you can rely on experts to analyze and predict needed adaptations instead of using your team’s resources.

Furthermore, reliance on a trusted 3rd-party API means that you can leverage technology that stays up-to-date.    

Cons

The major con of leveraging an external team to develop and maintain their APIs is that their products may not move at the speed you’d like. Because you don’t own their innovation cycles and instead are relying on them, there may be a time when the existing features just don’t meet your expectations. 

However, this is part of the benefit of using integrations and connectors to begin with. There are so many options available that product and development teams can strategically utilize those that meet their needs and build those that don’t.

Integrating Smart Builds with Smart Buys

If it isn’t already clear that we are fans of supporting your video infrastructure with integrations and connectors, we do believe that there are many instances where custom builds may be better than buys. 

These customizations are generally reserved for true value-adds or technologies that are simply not available via existing integrations. For example:

  • Bespoke user interfaces 
  • 2-way video integrations (ex. Live streaming personal training)
  • User-generated content capture
  • Custom / unique applications
  • Gamification (ex. fitness leaderboards)
  • Website (requirements are highly personal to an organization)
  • Custom analytics reporting / BI Dashboard
  • Advanced user profiles / content feedback + scoring

Leveraging Existing Video APIs is a Proven Strategy for Success

Innovation has always been a focus of streaming providers who want to differentiate themselves from the pack. However, when it comes to launching an innovative video stack, building the technology necessary to create a large-scale video platform can often prove to be a hindrance to even the greatest development and product teams.

With full-stack video API solutions such as Zype already in the marketplace, your team’s engineers and developers can make the smart choice to buy integrations and connectors and leverage their resources more effectively on the tech that makes them unique. 

When time-to-market, affordability, scalability, and future-proofing is at stake, the best option is to buy.

At Zype, we’ve built a comprehensive and connected API-first video infrastructure that can relieve the technical burden from engineers and developers, leaving more time and budget for content innovation.

Interested in learning more about how Video APIs can fit into your build or buy decision? Check out this post.