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Top 5 reasons to go with a SaaS service instead of building your own OTT platform

Roshan Dwivedi Published on : 21 July 2017
OTT platform - SaaS vs Custom Build

Thinking of starting your own streaming service or are you an organization that’s looking to expand into the realm of OTT Streaming Service?

I am sure you would have thought about various things that go together to make an OTT service, like content, revenue models, marketing and also technology and one of the most common thought when it comes to technology for most people is, should I go with a SaaS based platform and whether it is right for my organization’s needs or should I go with a custom-built solution?

If you find yourself in this dilemma, you are not alone. The rapid growth of cloud-based software solutions has literally shaken up previous myths about in-house development being the fastest and lightest approach.

Also, thanks to the low cost, lightweight SaaS solutions that are out there, increasingly businesses are preferring SaaS solutions over in-house or custom built, and why should OTT be any different?

If you are looking for information on why a SaaS based platform vs a custom-built one, are scratching your head in confusion and are struggling to make sense of the technical mumbo jumbo that’s out there, then, look no further because our aim with this blog is to fizzle out some if not all of that confusion as we evaluate both options.

We list 5 top reasons why you should go for a SaaS based platform instead of building your own. But first, we take a look at what is SaaS.

So what is SaaS anyway?

Software as a Service (SaaS) is typically a cloud based solution that provides users with ready-built software and hardware, accessed via a secure online (Cloud) platform and is offered on a subscription basis.

Basically, it means that you lease space on someone else’s software application for a specified period of time vs buying a license to use the software indefinitely or getting one developed for custom build.

Instead of having to install and maintain software, SaaS lets you simply access it online via the internet or in some cases offline through desktop applications, eliminating software and hardware management.

Basically, you have 3 options when you want an answer to the “Technology” question –

  • Using Software As A Service (SaaS) – Rent software without owning it.
  • Buy a license for software – lets you own license but not software
  • Software is developed by in-house developers or external sources – lets you own all the code

The provider of the SaaS service manages a host of features apart from access to the application including IT Infrastructure, security, availability and performance.

Let’s examine the top 5 reasons why a SaaS based service is better than a custom built solution:

  1. Ownership

One of the biggest question you may have while deciding the SaaS vs Build dilemma is “Do I own the platform?

In the case of a SaaS based model, you may not necessarily own the “Technology”, however, in a SaaS platform like Muvi One, you are the “owner” of the entire business! You continue to own content, you own 100% of the revenues, users, data and reports, you own your business name and all the associated rights with it.

When you build your own OTT platform, you can own the technology, however, it comes with added costs and other headaches which we delve into it in a little bit more detail later in this blog.

So, is it really worth it, to own the “technology” or would you rather be the “Business” owner?

SaaS platforms liberate you from having the overheads of owning your technology component. Being a content creator, you would rather focus on creating content rather than getting into headaches of owning and maintaining the technology.

  1. Timeframe

Custom-built can take months or years from start to finish. However, in the case of a SaaS subscription, it’s instantaneous. In practice, custom-built Enterprise software projects take about 6 months to a year or more depending on factors like the organization size, the scope of the project, the number of developers & stakeholders etc. Plus other factors like project planning, testing and bug fixing, experimenting etc can push the timelines beyond expectations, thus delaying the overall roll out of your project.

For a SaaS software, it typically is instantaneous, as the solution is pre-built and ready to deploy. The timeframe also depends on factors that are usually client dependent, like ready to deploy using default features or complex customization request.

In case of Muvi, the entire OTT ecosystem from IT infrastructure, CMS to Website and Apps for Mobile & TV can be deployed instantly in 1-Click, giving you the competitive edge by being either the first mover or be able to catch up to any existing competition instantly!

  1. Costs and build time

Usually custom-built software in the long run works out to be more expensive vs SaaS platform’s subscription which at first looks expensive because of the “subscription” model, however, in the long run, works out to be much cheaper.

Let’s look at costs involved if you are building your own software:

Type of CostCustom BuildSaaS
Salaries$100,000+ in salaries over 1 year to teams that involve developers, designers, IT teams, QA, PMs and many moreNil. Absorbed in Monthly Contract costs
Development CostsAt an average billing rate of $50 an hour considering total duration for just the native platform development, is estimated at 1400 hours, total cost for each such developer module will be about $70,000+Nil Absorbed in monthly contract costs
Operation Costs and other OverheadsOffice Space or desk Rent for dev teams, Furniture & other Office & IT Equipment Staff retention and salary increments Other office operational overheadsNil, your existing teams can be taught to run and manage the platform. This means you do not incur any operational overheads
Maintenance, Customizations and IT Integration CostAdditional overheads, can run into thousands of dollars. New Features need to be budgeted and are indirect costs in time and effort. Costs of failure are also to be taken into consideration since failure costs typically impact 30-70% of enterprise development projects. IT Integration Costs will require additional time and money. Maintenance is usually included in monthly contract costs. New features & IT Integration costs are additional cost but only a fraction of overall cost is charged to the customer. E.g. Muvi usually charges 1/10th as it becomes part of the overall SaaS platform.
IT Infrastructure costCosts such as servers, firewall, deployment and software and hardware maintenance costs are incurred upfront and ongoing when you build your own OTT platform.  Nil. Absorbed in Monthly Contract costs
Software and Licensing CostAdditional softwares installed on developer machines for which costs will be incurred on buying them and in case of licensed software, cost of buying those licenses. For many machines requiring licensed software, volume licenses will need to be bought. Nil. Absorbed in Monthly Contract costs   Cost of training for SaaS applications is low since organizations do not require in-house SMEs unlike on-premise software development for custom built software.
  1. Customization & Product Improvements, Upgrades & Support, Maintenance, Integration

Although in theory, custom-built software is completely customizable for your needs and SaaS software meets most needs for most companies, however, SaaS won’t necessarily be completely customizable.

In reality, the belief that all requirements can be met with custom-built software is an illusion. Factors such as resource constraints require prioritization of features which can get super messy. Not all requirements are met always and it isn’t highly recommended either since most people barely use a fraction of a product feature at the most. Quite often, organizations end up building overly complex software which affects the user experience which limits the usage of the custom built software solution. It also diminishes the overall quality of the custom built solution.

On the other hand, SaaS solutions incorporate best practices from different industries and companies into product development thereby ensuring maximum customer satisfaction. This ensures optimal utilization of features that are baked into the product based on user requests and helps build an ecosystem that can be used for multiple applications.

Customization & Product Improvements: When you build your own OTT platform, you add or remove features as you go along the product development process, however, the time and resources needed for those additional features would be more, whereas, for SaaS based services that come with pre-built functionality, any custom feature can be added based on client’s requirements at an added cost. The time duration and the cost involved are way lower than the time and resource investment for a custom-built solution. Also for SaaS OTT solutions, competition forces them to constantly improvize on their software. SaaS continuously evolves as it incorporates customer feedback into their product development roadmap.

Upgrades & Support: For a custom-built solution, once the software is built, the resources are allocated to other projects so any new upgrades on the software are mini-projects in themselves that eat up time and money. Also, maintenance and support for the existing platform requires investment in resources in terms of manpower and also they may not offer 24*7 support unlike SaaS wherein typically if users need help with any of its features, support is just a phone call or an email away and customer support is immediately available at anytime.

Third-party software integration: In theory custom-built software lets you integrate with any external software that you want. As far as SaaS subscription solutions are concerned, open APIs let most SaaS solutions integrate with a wide range of third party software.

In practice, most SaaS solutions these days come with inbuilt APIs. So, what are APIs? Let’s just say that APIs are like connectors that let two programs exchange information thereby facilitating integration with a wide-range of third party services.

This type of integration is possible only if the software has built in capabilities that permit such an integration.

When you are building your own OTT platform, developers may or may not know how to integrate the existing software with an external one(s). Man hours and costs taken to train the developers to perform such an integration successfully can prove to be expensive for your organization.

  1. Security  
SaaSCustom Build
Provide secure platforms that are usually pre-tested by QA specialists and/or third parties. The subscriber has no control or access to security features. The technical personnel working within your organization have complete control over security and data protection policies and procedures.
Security updates are automatic.Manual review of security protocols at regular intervals.
Additional security risks may be involved in an online SaaS platform compared to a fully offline solution.It is the organization’s responsibility to ensure stringent procedures and policies are followed.
A dedicated security team will most likely be allocated for ensuring the platform is secure. There may or may not be a team dedicatedly working to ensure the custom built platform is secure.

For SaaS based platforms, they come pre-built with security features so you don’t need to worry about your content being accessed and manipulated by external sources and you don’t need to worry about upgrades, updates or security patches unlike custom build where you would need to have dedicated personnel working on constantly looking into security upgrades and patches which is an added investment of time and cost.

If you are drawn by any of the below, then you or your organization could be an excellent candidate for considering SaaS software:

  • If you are not looking to set up an IT division or a business unit.
  • If you are not traditionally an IT Company with a team of developers.

It seems like a no brainer that an already built SaaS platform is more cost effective and an easy to implement solution compared to launching your own OTT streaming platform as it presents many challenges in terms of building it from scratch.

Convinced about SaaS? Let’s give you a head start by allowing you a 14-days Free Trial of Muvi so you can experience the simplicity and speed at which your Multi-Screen Platform can be deployed, instantly without any IT Teams or coding knowledge at your end!

Written by: Roshan Dwivedi

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