How to Build a Streaming App Based on Subscriptions?

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In just a few years, streaming media services have caused a real revolution worldwide. Several factors have led to a profound change in how audiovisual content is consumed on the Internet. Firstly, the development of connections in recent years. Then, the aggressive economic proposal of streaming platforms, the constant renewal of the catalog, and social networks have done the rest.

Before the arrival of these platforms, watching audiovisual content other than conventional television required a contract and a one- or two-year contract with a telephone operator. But technological innovations of the 21st century have revolutionized all sectors. In April 1998, Netflix began DVD-by-mail rentals. Fast forward 24 years, Netflix is synonymous with on-demand video streaming. Now, we can consume content from any device, without limits to the catalog and without permanence commitments. 

Moreover, more and more businesses are taking advantage of this new market. New media platforms have appeared for game streaming, e-sport, podcasts, and various subscription-based mobile applications. In this article, we focus on streaming app development and share our insights on how to build one.

The growth of the media streaming apps market

The streaming business is growing exponentially. According to Grandview Research, the global video streaming market will expand at a CAGR of 21.0% from 2021 to 2028. The market was worth $50.11 billion in 2020. The continuous increase in subscribers has been accompanied by an increase in the companies' share prices, with Netflix reaching a market capitalization of US$300.515 billion. 

In comparison, Spotify has surpassed US$53 billion. Likewise, business empires such as Amazon and Apple are placing increasing importance on the profitability of their streaming media services. 

The health crisis in 2020 increased the demand for audio and video streaming services globally. According to Allied Market Research, the music streaming market is expected to grow at a CAGR of 9.8% in the next six years and reach $24.7 billion by 2027. Spotify leads the way in the music streaming sector, with 30% of the global market share. 

Streaming apps have seen a significant increase in market valuation in the past year. In 2020, the combined market cap of the top five streaming companies increased by $330 billion year-over-year. Disney, Netflix, Comcast, and AT&T have over $210 billion in market cap each. Note that these figures are cumulative market caps rather than pure streaming valuations. 

Types of media in streaming app development

You can listen to or watch almost anything using streaming media technology. Once you’ve decided to build a subscription app, analyze the pros and cons of different types of streaming apps.  Many services provide free access; others require a paid subscription or another fee. In addition, you can find different types of streaming services available for live events, video and movies, music, and games. You can create audio or video content streaming platforms, and each solution has unique app development requirements. 

Audio vs. video streaming apps

Streaming is a form of data access based on "store and forward." This means that files are stored on a server that you can access on-demand whenever you want. As a result, many people can access the same content simultaneously, but they can start or stop what they are watching without affecting others.

Streaming platforms work like virtual cloud libraries, eliminating the need to download files. You can build live or on-demand streaming apps. Then, monetize with ads, subscriptions, and in-app purchases for services. You can also combine different options on a single platform. For example, Spotify offers live and on-demand audio content and monetizes through ads and subscriptions.

  • Audio streaming apps give users access to music, podcasts, and other sound-based content via the internet. Think of Spotify. With Spotify, customers can listen to their favorite songs and podcasts. 
  • Video streaming subscription apps allow customers to watch TV shows, movies, documentaries, sports, and other visual content. With over 200 million paying customers, Netflix is synonymous with video streaming.  

Technically speaking, building audio streaming software is less complicated compared to video streaming apps. Also, audio is less space-intensive than video. 

Media streaming use cases

Streaming media services are not limited to video or music. You can also listen to podcasts and audiobooks and receive radio stations from all over the world. Likewise, online sessions can be streamed for users interested in practicing meditation in the mindfulness sector. Media streaming is highly versatile, flexible, and customizable for different use cases. 

Here are some examples of how media streaming apps are used in several industries: 

  • Education: Online tutors, schools, and colleges use streaming apps to dispense educational videos and audiobooks. Students can also live-stream classes from remote locations via the app. 
  • Healthcare: Hospitals and clinics offer telemedicine services via streaming apps. Live-streaming video apps allow for one-on-one and group interactions between doctors and patients. For example, a therapist can live-stream group therapy sessions. 
  • Personal health and fitness: Wearables and fitness bands such as Apple Fitness+ leverage media streaming to provide live or on-demand workout sessions. Meditation specialists also offer content for practicing mindfulness via audio subscription apps. 
  • Gaming: Live streaming apps like Twitch send video games over the internet. Gamers can access user-generated content live or on-demand. 
  • Government: Governmental agencies such as law enforcement use live video streaming for search and rescue, training, surveillance, and more. In most cases, videos are captured using drones and body cams and streamed live for app users. 
  • Enterprises: In the aftermath of the health crisis, businesses increasingly use media streaming apps for meetings, marketing, employee training, and more.
  • Entertainment: Social media platforms like Instagram or TikTok allow users to stream posted videos. Media streaming apps have limitless potential. 

Media streaming market data

Subscriptions are a market standard widely adopted by users. Consumers acquire more than one subscription from different streaming platforms to access their favorite TV shows, movies, and audio content. Lockdowns and stay-at-home directives in 2020 enhanced this trend further. 

According to a JD Power survey, about 39% of respondents subscribed to four or more streaming services in April 2020. By December 2020, respondents with four or more subscriptions increased to 49%, and 13% use seven or more services. 

Another survey found that US households subscribed to an average of 3.33 SVoD services. To build a robust and profitable streaming service, understand why consumers choose specific subscriptions.

Building a streaming app – most popular billing systems for subscriptions

A complete billing system consists of several components to support in-app purchases and the billing process. To build a robust streaming app, use a billing system that streamlines subscription management. Your software should simplify payment processing, billing, invoicing, accounting, and more. 

Here are the most popular billing systems for subscriptions: 

  • Stripe: This solution supports subscription services and provides premade UI components. You can leverage Stripe’s API-first approach to customize your platform’s payment gateway. Most OSes support in-app purchases through Stripe.  
  • PayPal: This full-stack solution offers marketplaces and end-to-end subscription management. Android supports in-app purchases via PayPal. With PayPal Payments Pro, you can create and host your checkout pages. This option provides complete control over your subscriptions.
  • In-App Payments (Apple&Google): Apple and Google in-app purchases also can be used as the payment method for the digital content distributed via apps. Apple App Store and Google Play Store provide developers with a platform for distributing applications. All transactions have to go through the store, no direct transfers are allowed, and the commission is subtracted from the amounts spent by customers.
  • Chargebee. Easy-to-use billing system with robust features and customizations. It provides free and paid plans and supports 100 different currencies and payment options. 
  • Wave. This recurring billing software is free to use. It can streamline your streaming app’s online payment, invoicing, and accounting processes. Although Wave is cost-effective, it doesn’t provide advanced billing features.
  • Zuora. It offers sophisticated billing features, ideal for high-revenue subscription-based streaming platforms.
  • Chargify. A robust billing system for managing the entire subscription lifecycle. It offers recurring billing, subscription management, business analytics, and more.
  • Zoho. With Zoho, you get customizable billing, automated invoicing, and end-to-end subscription management. It supports multiple payment methods and currencies. 
  • Recurly. This recurring billing software leverages machine learning to help you minimize churn and maximize revenue.

Robust subscription systems combine several features, including analytics, payment gateways, dunning tools, and merchant accounts. Payment gateways eliminate the need to submit PCI compliance. Then, recurring billing services sit on top of payment gateways. Stripe, Paypal, or In-App Payments are the options also available for the split payments and marketplaces.

Streaming app development – subscription business models

Your business model can make or break your streaming service. It determines revenue generation, profitability, and long-term sustainability. Take some time to analyze all different audio and video streaming business models. 

  1. Freemium: With this business model, you offer a basic streaming service for free and optional in-app purchases for premium content. Freemium can attract new subscribers.
  2. Transactional Video on Demand (TVOD): TVOD allows your viewers to pay a one-time fee to download, rent, or live-stream your content.
  3. Subscription Video on Demand (SVOD): You charge a recurring fee for unlimited access to your content. Streaming companies like Netflix and AppleTV use this business model.  
  4. Ad-Supported Video on Demand (AVOD): AVOD model generates revenue from advertising partners. YouTube uses this business model, which is similar to pay-tv.
  5. Hybrid: In this case, you combine two or more models and different in-app purchase options. For example, Disney+ blends SVOD with TVOD while Hulu combines AVOD and SVOD. 

Regardless of the preferred business model, you’ll need to bill your customers for services rendered. Subscription-based streaming platforms generate monthly or yearly recurring revenue. An annual billing cycle covers the service cost of an entire year. The subscriber is billed once a year unless they cancel. With a monthly billing cycle, subscribers can cancel at any time. 

At its core, a subscription bundles content and offers them to the consumers as a package. So, you have to consider the most enticing packages for your streaming service. Focus on providing your subscribers value for money. 

Media Streaming Services for subscription-based apps

Media server software is advantageous in both personal and business environments. Since it allows users to play your media on multiple devices simultaneously and watch or view it any time they want on any device. However, lags and distortion can undermine viewing experiences. To build a high-performance streaming media platform, consider the following ingredients for success:

  1. Hosting platform. When choosing a hosting platform, focus on your needs. You can use cloud hosting platforms for video streaming services to guarantee quick and easy access to content. 
  2. Low-latency cloud hub. Select the cloud hub with the lowest latency for your subscribers to live-stream as close to real-time as possible. Low latency is a must-have if you’re building a live video streaming app. 
  3. Choose CDN. A content delivery network (CDN) facilitates seamless content delivery to users via server networks. Like server clusters, CDN brings your audio or video content close to your subscribers. It reduces the distance to the viewer, ensuring high-performance, availability, and stutter-free live stream. To enjoy these benefits, choose the right CDN. 
  4. Think about scalability. Build a scalable streaming app architecture from the ground up. Existing complexities increase as your streaming business grows. So, think about scalability from the start. With a CDN, your streaming app can handle more traffic. A robust cloud hosting platform increases storage space automatically. Both play a role in scalability. 

Building a streaming app – 10 must-have features

As we've shown before, video and media content is significant in today's world. However, to get video content accessible to a target audience and to build a subscription-based streaming app, you'll need these ten features in your mobile application: 

  • Registration and account setup

Complicated registration and account setup can discourage willing subscribers from signing up. Ensure your app’s registration process is seamless, painless, and quick. Leverage social media integrations to entice more people to register. You can use this step to gather personal preferences, which will help you provide personalized experiences. The trick is not to be too pushy or annoying. On social media, use a simplified account creation and registration process with logging in to the app. 

  • User profiling 

Streaming apps work with profiles like social networks. These profiles work independently for each user, so each user has their playback history, ratings, and likes; based on this information, the platform's algorithm establishes recommendations. Don’t underestimate the power of personalized experiences. Implement user profiling for more accurate content recommendations. Ideally, you should allow users to personalize their profiles based on their preferences. 

  • Robust search engine

Likewise, streaming apps must be exact in users' searches to meet their needs to consume streaming content. Incorporate a powerful search engine into your streaming app architecture for users to explore content more efficiently. You can use a filter search box to simplify users' search process.  

  • Browsing for discovery

Search engines work best when the seeker knows what they are looking for. But your subscribers don’t know about the content on your streaming media platform. To enhance users’ exploration and discovery journey, incorporate intuitive browsing in your app. For example, subscribers can find what they need by searching “I want to watch something funny.” If you're building a music streaming app, allow users to search by mood, genre, and remixes. The idea is to provide advanced search options beyond movie or song name, artist, actor, and producer. 

  • Freemium access

As mentioned above, one of the business models frequently used by streaming apps is freemium access, which attracts many users who can consume the existing content, but in a limited way, and to have access to all the content, they must have a paid subscription. Providing freemium access to the content is an effective way to attract new users. First-time users will promote your streaming service to friends and family through word of mouth. Freemium is a low-cost marketing tool.  

  • Paywall and paid access gateway

A paywall restricts access to paid content, while paid access gateway allows paying customers to access the content. Both are essential features for building streaming media services. Make sure to integrate them into your streaming app architecture. 

  • Smart player 

Your content should be accessible to customers via mobile, web, desktop, and smartTV. To this end, provide smart players on different platforms. A multi-platform player can broaden your target market. 

  • Traffic attribution

In addition, it is essential to have traffic attribution mechanisms in which it is possible to measure where the visits to the app come from. You can trace users’ journeys from external sources to your streaming app with traffic attribution. It can help you understand where your customers come from and the effectiveness of marketing campaigns.   

  • Funnel analysis 

After users subscribe, it is necessary to analyze the funnels to know which strategies are working and changing. Funnel analysis visualizes the journey of subscription users. How do users interact with your app? What is your app’s conversion rate? You can break down users’ engagement with your streaming app into views, comments, likes, and other actions. To leverage funnel analysis, implement built-in analytics in your streaming app. 

  • Marketing automation tools 

In a world as competitive as ours, it is impossible to keep up with user demand without a program that helps your marketing and sales team automate those analogous processes that take time and do not add value to the app. So there’s value in automating online marketing campaigns, sales activities, and all repetitive tasks. Integrating marketing automation tools into your streaming app increases revenue, reduces human error, and maximizes efficiency. 

Recommended technical stack for the streaming app development

Choose the ideal solutions for frontend interface and backend logic to build a robust streaming app. You’ll also need to pick the best hosting option for your platform. 

Here is a breakdown of four focal areas: 

  1. Frontend interface for mobile and desktop: If you aim for a seamless, integrated experience on both iOS and Android, you should consider a cross-platform development solution that allows code reuse, for example, Flutter, React Native, or Kotlin. Those solutions are ideal for technical product owners and startups with limited funds. What is more, Flutter also offers comprehensive libraries that meet streaming service needs and may bring you the benefits of other platforms like Desktops and Web portals being created from the same source code. Experienced Flutter mobile app developers from LeanCode can cost-effectively bring your ideas to life.

  2. Frontend interface for the web: With robust web technology, you can choose from plenty of frameworks. Specifically, React, and Angular are known for their widespread usage and ease of integration. What is important is that you must select the partner specializing in one of those and builds the specific expertise in a given framework. At LeanCode, we use React, which is considered a great balance between a modern yet stable framework for building state-of-the-art web portals with a great experience.

  3. Backend logic: With the rise of endless back services, the usage of a solid backend technology for the Proof of Concept phase is often underestimated. However, relying on a thin service logic has several drawbacks, some of which are described here. Use .NET Core, a solid and comprehensive solution for MVPs and long-term projects. It is ideal for projects that require rapid development based on agile frameworks, so it still gives you the required development speed. At LeanCode, we are Microsoft Partners and have great expertise in building a bulletproof service architecture based on .NET.

  4. Hosting and the infrastructure: Typically, when you choose the infrastructure, there is little that differentiates between the biggest providers like AWS, GCP, or Microsoft Azure. What you need to make sure of, though, is the ability to deploy your infrastructure automatically with Kubernetes and Docker services that are embedded in your cloud solutions. Use Azure CDN, and Azure Media Services. This solution provides flexible hosting with massive support for media services. Azure also has extensive infrastructure across the US and Europe.

Checklist for building your subscription-based streaming app

Here is a subscription-based streaming app checklist to help you get started.  

  • Define the MVP for your app. The characteristics of the Minimum Viable Product are that it is fast, cheap, accessible, and valuable. Why? It is a simple first version of the product, so it is neither expensive nor very elaborate; you can quickly get it to your customers because of its characteristics. Finally, it is handy because it lets you quickly study your customers' needs. As the basic model of your product, your MVP should help you fulfill the app’s primary goal and satisfy early adopters. 

  • Test your hypothesis on users. Validate the value proposition of your streaming app with customers as a central element of your work to become a successful entrepreneur. This is necessary to generate end-user demand and continue scaling the business on an ongoing basis. Organize goal-oriented research to confirm or disconfirm your hypothesis with confidence.

  • Estimate the cost and time for building the app. Estimating the development costs of the streaming app is an essential factor in analyzing IT projects; it is a strategic issue to have indicators to measure the same cost, ensuring efficiency, excellence, quality, and competitiveness. Streaming app development cost varies depending on factors like supported OS, architecture, and streaming engine integration. Developing a working prototype is cheaper than a full-fledged streaming app that runs on iOS and Android. You should also consider how long it will take to build your app. 

  • Select a reliable development partner. Finding a reliable streaming app development partner that delivers results can be an exhausting challenge in such a large market. The easiest way to refine your search is to consider all the elements of the company you choose and make sure these elements are in line with your own company for an effective transition. At LeanCode, we have an experienced team of .NET, Flutter, and React streaming app developers and designers. 

  • Ensure efficient project organization and communication. Good communication is essential in any aspect of life, especially when planning projects. If you want your project to succeed, you must communicate it well to everyone involved at all levels. From a communication plan of your project, you will have different means to distribute the information: reports, minutes, meetings, presentations, and other activities that make the project known. Good communication is essential to avoid costly delays and errors. 

  • Recruit early adopters for the product validation phase. In developing a streaming app architecture, validation is one of the most crucial parts of every project, as it ensures that the idea can generate revenue. This process helps answer vital questions when you need to make decisions throughout the streaming app development process.

With this checklist, you build a functional streaming app based on subscriptions. But you don’t need app development expertise in-house to acquire a streaming media platform. You can rely on LeanCode for mobile app development as a tech startup. 

If you want further inspiration, read our Case Study on how we developed Mindy Mobile Application, the subscription-based app for media streaming in the mindfulness market.

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