The Art of Content Acquisition for OTT Platforms: Original Productions vs. Licensed Content

A well-known reason people unsubscribe from streaming services is a lack of engaging content, which leads to low usage as users find little motivation to return. A recent YouGov survey among UK consumers found that 40% of respondents cited infrequent use as a primary reason for considering cancellation. This underscores the critical role content plays in a platform’s success, highlighting its power to either retain subscribers or drive them away.

A strong content strategy is crucial. Operators must carefully consider whether to focus on licensed offerings, invest in original productions, or strike a balance between the two. In this blog, we explore these options, highlighting the benefits and challenges of each approach. We also delve into the importance of content diversity, regional preferences, geo-restrictions, and other critical factors that influence a platform’s ability to retain and grow its audience.

Investing in Original Productions

The trend of streaming services producing original content is rapidly growing, especially among industry giants like Disney+, Netflix, and Amazon Prime. As more platforms prioritise exclusive programming, original productions offer several compelling advantages:

  • Exclusivity: Original content provides a unique selling point that helps establish a platform’s brand identity. Exclusive shows and movies attract and retain subscribers, as they can’t be found anywhere else.
  • Creative Control: Platforms have complete creative control over original productions, allowing them to tailor content specifically to their audience’s demographics and preferences.
  • Long-term Value: Original content serves as a long-term asset, offering continuous value without the need for re-licensing. Additionally, when a production becomes a hit, it can significantly drive audience loyalty and engagement.

However, despite these advantages, producing original content isn’t always the right approach for every platform. The significant upfront investment required for development, production, and marketing can be a substantial barrier. There’s also the inherent risk that the content may not resonate with audiences, leading to low financial returns.

For niche or localised streaming services, original productions can be particularly effective in connecting with a specific audience. Take Magine Pro customer Passionflix, for example. As a niche streaming service focused on romance, Passionflix employs a balanced content strategy—acquiring popular licensed content while also creating original adaptations of beloved romance novels. This dual approach allows Passionflix to serve a dedicated market and build a distinctive brand identity. By combining cost-efficient licensing with the unique appeal of original productions, Passionflix offers a curated experience that deeply resonates with its audience.

Specialised niche services can also benefit from adapting to regional preferences. By partnering with local creators and collaborating with regional production houses, they can deliver more authentic original content that truly connects with local audiences.


Licensing Existing Content

Licensing existing content is a widely used strategy in the streaming industry, offering several significant advantages:

  • Cost Efficiency: Licensing is often more cost-effective than producing original content, as it avoids the substantial upfront expenses associated with development, production, and marketing.
  • Broad Appeal: Established content, particularly blockbuster movies and popular TV shows, has the power to attract a wide audience and quickly enhance a platform’s library, making it more appealing to subscribers.
  • Flexibility: Licensing deals can be tailored for different durations, allowing platforms to regularly refresh their offerings and keep their content libraries dynamic and up-to-date.

However, licensing content also comes with its own set of challenges.

One major drawback is limited exclusivity—licensed content is often available on multiple services, which can diminish its potential to attract and retain subscribers. Moreover, licensing fees can fluctuate and accumulate over time, adding to the overall cost. The renewal of licenses is another critical factor; as contracts expire, streaming services must renegotiate terms, which may result in higher costs or, in some cases, the content may no longer be available for renewal.

For global streaming platforms, additional complexities arise from geo-restrictions. Securing global rights is ideal but often difficult, requiring careful navigation.

Despite these challenges, licensing content allows streaming services to offer a diverse and expansive content library, appealing to a wide range of tastes and preferences. For global platforms, this means curating a mix of genres and ensuring that content is available in multiple languages and formats to cater to different regions and cultures. This diversity can be a key factor in attracting and retaining a broad and varied subscriber base.

A Balanced Approach: Mixing Original and Licensed Content

Most streaming services, including those of our customers here at Magine Pro, benefit from offering a mix of original and licensed content. Original productions help build brand identity and exclusivity, while well-known licensed titles quickly attract a broad audience. For newer services, balancing these two will require careful budget allocation, guided by audience insights and strategic content planning.
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Want to learn more about our customers who successfully offer both original and licensed content? Explore our experience here.

If you’d like to discuss your OTT platform plans, get in touch with us. We leverage our in-market expertise to support our customers from start to stream.

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