OTT App Development: How Does Netflix Make Money?
OTT App Development: How Does Netflix Make Money?
With the growing audience for OTT platforms, OTT app development is in huge demand. Companies are looking for an OTT app development company that can develop popular like Netflix. Let's understand the Netflix business model to learn how you can create a similar OTT app.

Being the world's biggest OTT app development company, Netflix was the pioneer in on-demand video streaming apps. But everyone is curious to know its business model. How does Netflix make money? For the answer to come to you, you should read this blog.

Netflix was the first successful OTT app development that encouraged customers to subscribe to all-exclusive video content. In modern times, Subscription Video on Demand (SVOD) is being used by several other OTT players such as Disney Hotstar, Hulu, Amazon Prime, Youtube, etc.

Entertainment app development solutions have a new name OTT (Over The Top) platform. Read ahead if you're planning for an OTT app development and want to learn how Netflix makes money.

What is Netflix Business Model?

Netflix's business model is subscription-based rather than generating revenue at a specific title level. With its unique media & entertainment app development solutions, Netflix produces, acquires, and licenses content which includes original content in various formats.

As part of its core strategy, Netflix grows its streaming membership business internationally by improving the user experiences. Netflix tries to delight current members and attract new viewers, whether using an app or a website.

Netflix breaks down its revenue into four leading geographic regions, including:

  • The United States and Canada(UCAN)
  • Europe, Middle East, and Africa (EMEA)
  • Latin America (LATAM)
  • Asia-Pacific (APAC)

The entertainment app development industry has many options, such as HBO Max, Disney Hotstar, Amazon Prime, and Hulu. Netflix differentiates itself by producing more original content.

What are the ways in which Netflix makes money?

Netflix has two primary sources of revenue:

Membership Fees

Monthly subscriptions are the primary source of income for this media and entertainment app. Netflix offers many different pricing levels, which leads subscribers to find the most suitable plan per their needs.

The price differences are based on the following criteria:

  • Number of screens watched at the same time
  • Number of devices for downloads
  • HD availability
  • Ultra HD availability

A basic plan for Netflix stands at $8.99 per month. With this membership, the users can watch one screen at a time and can download content on a single device, whether it's a smartphone or tablet. No HD is available.

A standard plan is for $13.99 and provides the facility of two screens at a time and downloads on two devices. It also has HD available.

The premium plan stands at $17.00 and gives access to four devices for viewing and downloads with ultra HD.

The OTT company doesn't plan to extend to additional plans, which would draw more out of a user's pocket.

2. DVD Rentals

Since 1997, Netflix has sold DVDs to customers across the U.S. It continues to make money by delivering its DVD via mail service in the U.S. But, presently, the model is turning obstinate, with revenue dipping year after year.

Customers in the U.S. can Log in on to browse from a list of thousands of movies and shows. The customers can also choose which content they want to purchase on rent. The disc is sent to the customer's desired address within two business days.

Disc returns do not cost anything, and there is no provision for late fees. Netflix offers content from HBO and Starz on its DVDs with its entertainment app development solutions.

Netflix has the following DVD plans:

  • $7.99 per month with one disc at a time and an unlimited number of discs in a month
  • Premier DVD plan of $11.99 per month and permits customers with two discs out at a time.

Closing Words-

Even with the growing competition in media & entertainment app development solutions, Netflix has successfully held on to its audience with its vast content offerings.

If you're looking for a successful OTT app development like Netflix, Consagous Technologies can help you create a fully customizable interface. With multiple device streaming, portability, and excellent streaming services, you can get the best with our OTT app development company. Reach us today.

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