Nowadays, OTT app development is crucial in the field of media distribution and consumption. In this article, we will try to help you make a key decision: should you develop OTT applications in-house or should you decide to outsource? By comparing the advantages and disadvantages of the two approaches, we will equip you with the knowledge necessary to choose the right path for your business.

Understanding the importance of OTT app development 

OTT (Over the Top) app development is becoming increasingly important in today’s market for several reasons. First and foremost, the consumer trend toward digital media consumption continues to accelerate, with an increasing number of users preferring online streaming services to traditional television. This trend is further fueled by the advancement of internet technologies.

Second, the development of OTT applications offers companies a direct channel for interacting with their audiences. Unlike traditional media, OTT platforms enable the collection of user data, allowing content providers to customize their offerings and improve the user experience through personalized recommendations and targeted advertising.

In addition, OTT applications represent new revenue streams. Subscription-based, pay-per-view and ad-supported content models are just a few ways companies can monetize their services. This diversification is especially important in a market where traditional revenue models are becoming less and less effective.

Developing OTT apps is now a must-have for companies that want to thrive in the media environment. The decision between developing these capabilities in-house or outsourcing is a strategic one, and each option has its own benefits as well as challenges.

Building OTT Apps In-House: Pros 

Developing an OTT app within your own organization can offer several advantages and drawbacks. Understanding these can help businesses make an informed decision about how to approach their OTT app development. What are the advantages of in-house development? 

Greater control over the project 

One of the most important benefits of in-house development is the level of control it offers over the entire app lifecycle. Having an internal team working on the app ensures that every aspect, from the initial concept, design, and development phases to deployment and subsequent updates, remains under the direct and close supervision of the company. This oversight allows for the creation of a product that not only closely aligns with the company’s strategic vision, but also ensures that the app’s features, user experience, and overall functionality precisely meet the company’s specific requirements.

Faster communication and decision-making 

Another advantage of in-house development is the streamlining of communication and decision-making processes. When a team works closely together within the same organizational structure, it eliminates many of the barriers usually encountered in external communication, such as time zone differences. This proximity allows for immediate feedback, faster iterations, and quicker resolution of problems that arise. Decisions can be made quickly, without the need for lengthy external consultation, making the development process more flexible and responsive.

In-depth understanding of business needs 

In-house development teams have an inherent advantage – a deep understanding of the business goals, culture, and target audience. They are inherently aligned with the company’s strategic goals and the specific preferences of its customer base. This in-depth knowledge is invaluable in developing an OTT app that resonates with the intended users. For example, if a company is targeting a niche audience, an in-house team may be better equipped to tailor the app to the unique preferences and behaviors of that group, ensuring greater user engagement and satisfaction.

Building OTT Apps In-House: Cons 

While developing an OTT app in-house provides numerous advantages, such as greater control and alignment with business objectives, it also comes with several significant disadvantages that need to be carefully considered.

Higher costs and resource allocation 

One of the main disadvantages of developing OTT apps in-house is the need for significant financial investment. Developing a high-quality OTT application requires a dedicated team of skilled professionals, which includes hiring and potentially training developers, designers, QA testers, and project managers. In addition, there are costs associated with setting up the necessary infrastructure and technology, such as servers, software licenses, and development tools. Ongoing maintenance and application updates also involve ongoing expenses. These costs can be significant, especially for small and medium companies with limited budgets.

Potential limitations in technical expertise 

In-house teams may lack technical expertise or experience in niche areas of OTT application development. OTT platforms often require knowledge of advanced streaming technologies, cyber security, cloud services, and user experience design. Recruiting individuals with these specialized skills can be difficult and expensive. Moreover, keeping up with the dynamic changes in the OTT space can be a daunting task for an internal team that may already be heavily burdened with other projects in the company.

Outsourcing in OTT App Development: Pros 

According to the statistics, more than 75% of executives said they would outsource IT services. Outsourcing offers a range of benefits, making it an attractive option for many businesses. Here are some of the key advantages:

Cost-effectiveness 

The cost-effectiveness of outsourcing OTT application development is a major attraction for many companies. Outsourcing eliminates the need for the significant investment that is typically required to create an in-house development team. There is no need to invest in specialized software, hardware, or other technological resources because the outsourcing partner already has them. This is especially beneficial for small and medium-sized companies or startups that may have limited capital.

What is more, with outsourcing, you pay for services as they are needed, which can be more economical compared to maintaining a full-time in-house team. This payment flexibility allows companies to allocate resources more efficiently and pay only for the costs associated with the work actually performed.

Scalability and flexibility 

Outsourcing is beneficial for companies looking for scalability and flexibility in developing OTT apps. This adaptability is particularly important for projects with changing requirements or that require rapid adjustments to accommodate changing market trends. Outsourcing teams can be scaled up quickly to accelerate development during peak phases, or scaled down to reduce costs when demand slows. This flexibility means companies can respond quickly to new opportunities or challenges, making it easier to manage project schedules and budgets effectively.

Reduced risk 

Outsourcing the development of OTT applications can significantly reduce the risks associated with project implementation. Outsourcing partners with extensive experience in similar projects bring a wealth of knowledge that can be helpful in avoiding common pitfalls and mistakes. This experience leads to a smoother development process, often resulting in a higher quality product. In addition, since the responsibility for completing the project on time and within budget rests with the outsourcing partner, companies can enjoy a level of safety and security knowing that the project is being managed by experienced professionals.

Access to specialized skills and expertise 

Outsourcing breaks down geographical barriers, enabling companies to tap into a global talent pool. Access to a wide range of professionals from various parts of the world brings diverse perspectives and innovative ideas to the project. Outsourcing companies often specialize in specific areas of application development, such as user interface design, streaming technology, or data security. This specialized knowledge ensures that every aspect of the OTT app is handled by professionals who are experts in the field.

Outsourcing in OTT App Development: Cons 

While outsourcing OTT app development can offer several advantages, it also comes with its own set of drawbacks that need to be carefully considered.

Lesser control 

Limited control over the app development process is a noticeable disadvantage of outsourcing OTT app development. In this scenario, decision-making becomes more distant because the physical and operational separation of the company from the development team can lead to challenges in implementing immediate and detailed decisions. Aligning an external team with the company’s vision and goals can also be difficult, increasing the risk that the final product may not meet stated goals.

Moreover, maintaining consistent quality standards and practices becomes more complex. While internal teams are often deeply aligned with the company’s quality expectations, an external team may operate to different standards. This discrepancy may impact the overall quality and suitability of the final product.

Communication and cultural barriers 

Another challenge may be communication and cultural barriers. When working with a team in a different geographic location, time zone differences can cause communication delays, hindering the efficiency and progress of the development process. Language barriers can further complicate this issue, potentially leading to misunderstandings and misinterpretation of project requirements or feedback. Cultural differences in work styles, communication practices, and business ethics can also impact project management and execution. These barriers can also impact the overall working relationship between the company and the outsourcing team, requiring additional effort and resources to manage effectively.

How to make the best decision? 

Choosing between developing OTT applications in-house or outsourcing is a key decision that can significantly impact the success of your project. Here are the most important considerations to help you make the best choice for your business:

Assess your company’s core competencies and resources: Assess whether your team has the skills and knowledge necessary to build apps. The availability of resources, including technical knowledge, infrastructure, and financial capacity, should be considered.

Consider the complexity and scope of the project: Analyze the complexity of the app you intend to develop. If it requires specialized knowledge or technology that your team is not familiar with, outsourcing may be a better option. Outsourcing may also be more appropriate for large-scale or complex projects.

Analyze the cost implications: Compare the costs of developing applications in-house versus the costs of outsourcing. Consider not only immediate costs, but also long-term expenses such as maintenance, updates, and scaling. Outsourcing can offer a more cost-effective solution for companies with limited budgets or those not willing to invest in long-term growth opportunities.

Time-to-market considerations: Determine how quickly you need to launch your application. If speed is a priority and you lack direct in-house capabilities, outsourcing to a trusted solution partner can speed up the development process.

Long-term strategic goals: Align your decision with your company’s long-term strategic goals. If developing technological expertise is part of your long-term vision, investing in an internal team may be beneficial. Conversely, if app development is a one-time endeavor, outsourcing may be more appropriate.
Conclusion

The decision between in-house development and outsourcing is a crucial choice for your business. Both approaches have their pros and cons, and the right choice largely depends on your company’s specific needs, resources, and strategic goals. To make a right decision, you need to consider factors such as cost, control, expertise, time to market, and scalability. Internal development provides greater control and alignment with business goals but is associated with higher costs and requires significant resources. On the other hand, outsourcing provides access to specialized skills, cost efficiency, and flexibility, although it may mean less control over the project and potential communication challenges.

For many businesses, finding a reliable and experienced partner can be the key to success in their OTT app venture. In this context, Better Software Group stands out as a potential solution partner. With our experience in OTT app development, commitment, and understanding of the latest technology trends, we can offer the professional guidance and support necessary to make your OTT app project a reality.

The decision should be consistent with long-term business strategy and operational capabilities. By carefully evaluating your options and potentially partnering with an experienced player like Better Software Group, you can rest assured that your OTT app development journey will be a success.