How To

How Much Does It Cost To Build A Streaming Service Like Netflix In 2019?

12 Jan 2019
9250
20 min

Beyond any doubt, modern people can entertain themselves with any TV program, movie, and series to make even the most boring evening interesting. Moreover, modern TVs have the Internet connection so it is not necessary to browse channels for hours to find something interesting. Thanks to the Internet, you will always be able to find something worth your attention. But how to choose an appropriate service to watch a movie in HD quality without annoying advertising?

Today Netflix service is drawing TV viewers from all over the world. What is the secret of its popularity? Access to thousands of programs and movies and various service packages can satisfy any taste. Maybe, one day somebody decides to create something similar to Netflix and add new features to beat the Netflix fever. Is it possible to do? Well, you won't find it out until you try. Online streaming services like Netflix can become very popular. We will discuss how much it costs to create movie streaming website and mobile app similar to Netflix and what should be undertaken. 

How does Netflix streaming work?

Netflix is a subscription service for watching movies and series on various platforms. It is the largest video-on-demand service with the enormous database of cartoons and films. Having paid a monthly fee, clients get access to an unlimited content. Netflix can function on many gadgets and run on various operating systems like Smart TV, Windows Phone, iOS, Android, PC, Mac OS etc. 

how to start a company like netflix

Netflix website

Users can download and use this app for free during the first month. Then automated subscription and purchases are integrated into the app. For example, if you are subscribed via iTunes, payment is made via iTunes account. 

Netflix is constantly adding new content. But its features are rather wider than it may seem at first glance:

  • You can list the content in the already existing library or use an integrated search feature; 
  • With the help of the CineMatch system, Netflix can offer you new TV shows and films according to your preferences; 
  • The app makes it possible to create up to five separate profiles in a single account; 
  • It offers a lot of streaming videos. 

Various profiles allow your friends or family members to have their own personalized Netflix experience that is built on the basis of their preferences. 

You can also add your search categories to your service. You should rate films viewed, then the app will sort out films you like more precisely.

How to create an app like Netflix

Follow these steps to build your Netflix-like streaming service:

  • Step 1. Follow the right strategy to start Netflix-like app building 
  • Step 2. Prepare your business model 
  • Step 3. Use tech stack to create streaming service like Netflix 
  • Step 4. Add MVP features to build the skeleton of your service 
  • Step 5. Consider all important requirements to keep up with 
  • Step 6. Keep up with useful hints to make your service successful 

Right strategy to start a business like Netflix

We are going to list the main steps you should undertake before you start learning how to create a streaming website like Netflix. 

how to create an app like netflix

Strategy to build Netflix-like app

#1. Find your niche

Haste makes waste, so you don't need to build everything quickly. First, you should determine the type of your streaming specificity. Video streaming service on demand is a general conception, and you should understand what niche in this area you will choose. What types of movies or TV programs your website or mobile app will contain, or maybe you plan to build a streaming service for kids and it will include cartoons and developing TV shows. 

It is very important to make your choice. Of course, you can create your own Netflix-like service that will cover all potential viewers, but a personal specificity of your service may become your punch line. 

#2. Build your content

When you plan to find out how to create a video streaming website like Netflix, you should determine what your content will be. Because content is the foundation of video streaming service and it depends on content how attractive the service will be. 

First, you should make a choice how often you will update your content - daily, monthly, or weekly. You will add part of TV series or everything at once as Netflix does? Will your content be partially available for free or it will be necessary for subscribers to pay for watching? 

There are a few important issues with content you should pay attention to, keep it in mind. 

#3. Get licensing for content

Of course, you need to follow all guidelines and rules, and we all should abide by law. That is why you need to get licenses for all types of content you plan to stream. How can you do it?

First of all, you have only two ways to get the license for public performance:

  • You may rent the movie directly from a distributor that is authorized to grant such licenses;
  • Or you may contact the copyright holder directly.

Both options are appropriate, everything depends on your opportunities and individual particularities each of this option has. If you plan to rent a a movie or TV series from an authorized distributor, there are two major distributors in the USA:

  • Motion Picture Licensing Corporation (MPLC)
  • SWANK Motion Pictures

If you chose a second option, you need to contact a studio that is a right holder of a specific content, and negotiate with them.

Note: Keep in mind that there are different types of licenses. For example, one studio will sell you right not for the whole TV series but only for one season. It can be even more convenient since if you see that this TV series is not popular on your website, you will remove it and won't extend licensing for the next season. Also, it is important to know that some movies or shows can be under exclusive distribution rights and you won't be able to purchase licensing anymore - it means only one service has exclusive right for streaming and public performance. Besides that, licensing may be restricted to specific regions, and you won't find a licenses for content distribution in your region. So consider all these challenges.

As for expenses, if you plan to become as large service as Netflix, you will need to spend billions of dollars on content licensing. For example, according to Investopedia, the company spent about $13 billion in 2018 on content licensing and production. At the same time, Netflix earned more than $16 billion during 2018, so everything was paid off, according to Netflix Investors. However, of course, you will need to start small and monitor the development of your business, and if everything goes well, you will be able to buy popular films and TV shows that are usually expensive.

#4. Think about a style

Here you should make a decision on what design and general style your website or app will have. You have two ways to create a style of your service:

  • Use a style similar to Netflix, find some ready-made templates and offer software development company to use them in your service; 
  • Create your own style from scratch. UI/UX designers at software development company you cooperate with will build a unique style for your future streaming service.

As you understand, the second way is preferable. It is much better to have your own personal style than copy existing models. Netflix has its own design, so you'd better keep up with this model as well. 

#5. Consider all platforms

You will find information below regarding platforms you should choose to create your own movie app, but we will tell about it more in detail. If you plan to build a website like Netflix, you should keep in mind to create a mobile app as well. We don't need to provide you with statistics, everybody knows that the majority of users spend more time using their mobile devices rather than PCs. 

It means that a mobile version of your service will be a preferable option for such users. You may think that a responsive or adaptive website version will be enough, but it is a big mistake. A native mobile app on iOS/Android gives users a more personalized experience and more convenient. 

#6. Focus on your audience

And the last step in this strategy is to find your target audience. You can do it in a few ways:

  • Social media. Popular social networks like Facebook, Twitter, Instagram etc. Share videos of your service in these social media to promote your service and find the right target audience; 
  • Use YouTube. This service is a very powerful engine for brand promotion, so use YouTube to build a trustful attitude towards your product; 
  • Arrange newsletters. Send your potential customers letter with a detailed description of your product, but mind to make a letter presentable and attractive. 

Thus, you will find your audience quickly. And then you can proceed to business model you should keep up with to understand how to create a movie website like Netflix. 

Business model to follow

I guess everybody understands that launching a new business resembling the Netflix model does not guarantee you an immediate astonishing success. Of course, it will take time until you start earning money, at the very beginning you will scale gradually. If your aim is to become a competitor to Netflix and create a website like Netflix, you must be ready to spend at least a few years on making your business profitable. If you want to know how to write a startup business plan, read this detailed article.

First, you need to create a Netflix-like service - a unique content. Nobody wants to pay for content that is come-at-able. But you should obtain the license for the content distribution, and then begin to develop your new business.

Monetization

Monetization of video platform is performed on the basis of the subscription model, so you can propose variable plans for your viewers. For example, you can charge a monthly, quarterly or annual fee. But you shouldn't forget about free trial versions for month or more in Netflix-like apps. You can either propose to subscribers all video library or only its part. It allows you to control monetization. 

!

Take a look at a detailed guide to your app monetization. Read How to monetize your app

That is you must anticipate the following: 

  • Creation of plans for users; 
  • Automated repetitive payments; 
  • Free trial version; 
  • Auto-updating/discounts; 
  • Video advertising. 

Furthermore, you should consider a multi-currency support and integration with several payment gateways to allow subscribers to pay with their local currency.

Lifetime Value - its definition and importance

Any successful entrepreneur will tell you that you shouldn't be afraid of losing money in short-term prospect if you can earn more in long-term prospect. But before losing money, you should determine the lifetime value of your customers. Without it, you cannot optimize your profit. It is one of a key factor in the understanding of how to make a website like Netflix. 

Maximal increase of lifetime value

Following specific events and activity of customers, you will notice that the more active users are, the more they are likely to pay for services during a longer period. To increase your income, you should follow each client. Tracking statistics and customer behavior, Netflix managed to reduce the outflow of clients up to 4%.

Marketing expenses

The marketing campaign is a very good way for developing your business, but you shouldn't spend too much money without elaboration of your business model of the future website or app like Netflix. It is not enough just to determine the customer lifetime value.

You should understand the lifetime value of customers that come from various sales channels. It will help you make a decision about how many clients you can obtain for each channel.

To sum up, the development of a streaming app like Netflix is expensive and painstaking work where a good marketing strategy is a key factor for success and profit. 

Technology stack for Netflix-like service

Here you will find the list of the main tools that should be used for the development of streaming service. 

how to create a website like netflix

Tools developers should use to build your streaming service

Development tools

Languages: Java, Python, Kotlin, Swift, Javascript; 

Database: MySQL, Cassandra, Oracle; 
Frameworks: Node.js; 
Cloud hosting: Amazon EC2; 
Cloud storage: Amazon S3; 
JS libraries: React, WinJS; 
BDaaS (Big Data as a Service): Amazon EMR; 
Operating system: FreeBSD; Server: Nginx.

DevOps tools

Code collaboration & version control: GitHub; 

Continuous integration: Jenkins; 
Server management: Apache Mesos; 
Log management: Sumo Logic.

As you can see, there is a large set of tools that can be used to start your own streaming service, and developers at Cleveroad have enough experience to deal with all featured tools. 

MVP of Netflix-like streaming service

Netflix falls under the app category of databases that require heavy backend for processing of streaming data transfer. The total cost of the development of TV services like Netflix depends on a number of features it will have. The more features it has, the more expensive it is. So for the beginning, it is better to add main features only into the first app version, to reduce its cost. Additional features can be added later when the app and website will start gaining popularity.  You can also check our App cost calculator - it will help you estimate how much you will need to spend for your app.

MVP features development cost
MVP features Mobile/web development time, h Cost, $
Users registration + login Approx. 13/15 650/750
Payment gateway Approx. 58/39 2262/1950
User profile Approx. 38/32 1900/1600
Content search Approx. 30/34 1500/1700
Chat and comments Approx. 126/74 6300/3700
Push-notifications Approx. 15 750
Settings Approx. 400 20.000
Total app/website cost Approx. 32.600/29.700

Our expertise: Pay attention to the app like Netflix that we enhanced and improved this year in this case study. The app called Blockbuster designed for video streaming targeted at Danish market. We haven't built it from scratch, but our team has fixed bugs and changed the app architecture. It took about 3 months for our specialists to improve the architecture and they added also a few feature like movie downloading that took 140 hours for them.

Platform

There is no substantial difference between an app development for iOS or Android. But for the minimum viable product, it is better to choose only one OS to start. But if you want to involve as many users as possible, you must consider the development of the app for both mobile OS versions. Besides that, you should also build Netflix-like website, since streaming services are often used in web versions as well. 

Design

Hard-to-use apps definitely alienate users and people are unlikely to use such apps in further. Therefore, simple design is very important in other apps like Netflix. It will allow users to receive the necessary information at a blink of an eye. 

UI/UX design: up to 140 hours

Users registration

The first feature that cannot be ignored is registration. Registration via email and social networks will make it very convenient for the potential users. 

User registration Netflix

User registration feature in Netflix

Mobile development: up to 13 hours; 

Front-end: up to 15 hours; 
Back-end development: up to 8 hours.  

Payment gateway

There is no need to integrate your own payment gateway into your app if you are going to use an operating system from Apple or Google. Android and iOS have their own mobile payment systems that allow making purchases in App Store and Google Play just with one click of the button. The only thing users need to make payments is to register their account. Apple and Google offer special frameworks for using their APIs. All operations are performed in Google Play Store and Apple App Store. But it is worth considering that these companies charge 30% from all purchases total amount in an app.  

Payment gateway Netflix

Payment data on Netflix website

If you are intended to create a streaming website as well, in this case, we advise you to use payment gateway for like Stripe or Braintree. Each payment service shall have PCI-DSS compliance. And such gateways providers as Braintree and Stripe PayPal also offer their native libraries for both Android and iOS. 

Mobile: up to 58 hours; 

Front-end: up to 39 hours; 
Back-end: up to 47 hours.

User profile

Here users can add their favorite movies or something like that. Also, it is possible to add more people to your account in order they can watch their own content in Netflix-like streaming service. 

User profile Netflix

A few user profiles in Netflix

Mobile: up to 38 hours;

Front-end: up to 32 hours; 
Back-end: up to 24 hours.

Content search

Selection of genres, selection by user reviews. You can check what your friends watch and what films they like.

search feature Netflix

Search bar in Netflix to find your favorite movie

Mobile: up to 30 hours; 

Front-end: up to 34 hours; 
Back-end: up to 20 hours.

Chat and comments

Communication with other users, leaving a comment.

Mobile: up to 126 hours; 

Front-end: up to 74 hours; 
Back-end: up to 107 hours.

Push-notifications

For example, you will be notified once a new TV series or show is released.

Mobile: up to 15 hours.

Settings

Selection of audio track, subtitles on/off, play/pause, rewind, volume control etc.

Settings Netflix

Settings in Netflix

Mobile and front-end: up to 400 hours; 

Back-end: up to 400 hours.

Multiple language support

The more languages Netflix-like app will support, the more users you have.  Development time is included in Settings feature.

Blocking of screenshots

Protection of the copyright so that users can not make any images from the content. However, this feature is available only on Android OS. Development time is included in Settings feature.  

!

How can MVP be a profit for you? Read Minimum Viable Product as a start of your business  

Admin panel

It should be available obligatorily since you as an admin will have access to all content to manage videos and users as well, edit videos, block users if necessary and so on.

Front-end: up to 127 hours; 

Back-end: up to 153 hours.  

Additional possible features

We mentioned features of the minimum viable product where all of them are an integral part of your future streaming service. It is impossible to design a Netflix type system without the above features. But if you want to enrich your new app and website and add more interesting features, here are some of them for you to integrate into your new product.

Social sign-in

Capability to share news and reviews via social media.

Sign-in Netflix

Sign in via Facebook account

Reviews and ratings

You can rate a television program or movie, forming your own rating on the basis of your portal users' opinion.

Live streaming video

Live broadcasting of specific TV programs, shows, sports events etc.

Content recommendation algorithm

Netflix has the CineMatch system that provides users with content which is more interesting for them. You can integrate something similar into other services like Netflix.

Geo-blocking

Due to different restrictions in separate regions of the world, some of the available content in your app can be forbidden in these regions. So if you want your app to be available in as many countries as possible you should pay attention to this feature.

Download feature

Users can save content on their tablets/smartphones/PC so that they can watch it even when there is no Internet connection available.

Video quality

According to clients' requirements and the technical features of his/her gadget, he can choose a quality rate. 

video quality change Netflix

Change video quality in Netflix

But if you think that there are other features your future streaming service requires, you can add them!

Crucial requirements for streaming service to keep up with

How to make your own Netflix-like service? You should know that your streaming service should keep with some important requirements that ensure a proper functionality of the service, and, respectively, it has a direct impact on users' engagement. 

Stable storage. Today cloud hosting is fairly considered as the most reliable storage for any type of content. So all your videos should be stored on a good and well-tried hosting so to provide users with seamless content delivery and trustful experience. 

Good network connectivity. Mind to apply Content Delivery Network (CDN) to create a stable connectivity and prevent servers overloading, give users a shorter request time and so on. If you don't what CDN is better to choose, our specialists will give you a useful hint about what is preferable in your case. 

Do you know what you need to build a digital streaming app? Watch our video to find out: 

How to Create a Digital Streaming App?

High bandwidth. The combination of reliable video streaming protocol and CDN will ensure high bandwidth and low probability of lagging. If you add video in 4K resolution, you should equip your service with a stable and high bandwidth.

Security. You should protect your service from any unwanted intrusions from third parties, so you should think about token security, domain restriction, geo-restrictions, SSL encryption. 

Choose your video streaming protocols. There is a large number of streaming protocols like WebRTC, HLS, RTMP, and each of them has its benefits and drawbacks that should be considered. Developers can help you choose a video streaming protocol that is acceptable in your specific case. 

Final hints to consider when creating a high-quality Netflix-like app

What actions should be undertaken to achieve success when you create website like Netflix? We can help you with this issue since our experience is rather rich. Furthermore, we can advise you on how to become a prosperous owner of other movie apps like Netflix. 

Product determination. Proper estimation and planning during the development will surely lead you to success. 

User experience. Pay attention to the way your audience is immersing in your content, starting from menu structure to player design. Users want to log into the system and make online purchases as simply as it is possible. Also, they need a large list of content where they can add bookmarks of films to watch in the future.

Personalization and big data. Development of various recommendation models on the basis of various analytical information, A/B testing.

Planning of ad strategy. Capabilities of audience growth, income increase, advertising strategies.

Security. Content security provision so as to avoid legal problems.

Analytics. On the basis of data analysis and data collection, you can improve your rates, determine which features confuse users, what is necessary to modify to draw more customers or increase loyalty for existing customers.

Quality of service (QoS). It can refer to many app components whether it be user experience, streaming speed, transfer, delivery or playback of the content. The ad is an important part of customer's experience, it shall be effective and it shouldn't alienate users.

Multiplatforming. You must choose the platform you find the most applicable in your case. Furthermore, you should take into account that users are expecting to watch content on various gadgets, and many of them want to see the 4K resolution. 

Total cost of the Netflix-like service development

As you can see, it can take a lot of time and resources to make a website like Netflix or a mobile app. But the cost of the final product will depend only on how many features will be added to the app. Of course, if you make a decision to create such app, the cost may seriously vary, but we will show an approximate total development cost of the Netflix-like app. 

Important note! Please, take into account that all costs are rough and the final price of your streaming service may vary. Everything depends on your specific requirements. Moreover, to the indicated price we also include meetings and code documentation processing. 

Design

Design should be both attractive and easy-to-use. It is a guarantee of success. So for the development of the TV app like Netflix, development cost may be the following:

  • iOS - min $37.600 - max $53.750 
  • Android - min $37.750 - max $54.050 
  • Back-end - min $36.650 - max $48.000 
  • Front-end - min $28.900 - max $37.900 
how much does it cost to start a streaming service

How To Create A Service Like Netflix And Estimate Its Cost

!

Get know more about software development cost in Europe by region. Read European IT services market

Thus, according to the infographics above, you can easily imagine how to start a video streaming website and how much it will cost. And it can become profitable if you are intended to follow the correct marketing strategy and ready to invest the required sum amount. But for proper development of the app itself, you should trust the high-skilled development company that can implement your ideas accurate within your requirements and desires. So please get in touch with us anytime, we are always at your disposal! And click a Subscribe button to get our newsletters! 

By the way, you can check our new design of the concept app for desktop dubbed My Cinema Dashboard. Using it, you can filter out all details concerning movies, read movie news, draw up your own movie collection. 

My Cinema Dashboard

My Cinema Dashboard

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