Roku is the dominant platform for streaming services. Here is everything you need to know about building your own Roku channel.
Over-the-top (OTT) streaming is the most rapidly growing type of entertainment media. Roku is currently the biggest platform with almost 52 million users at the end of 2020 and 58.7 billion streaming hours in 2020 alone. This makes Roku a no-brainer if you are looking for platforms to develop a streaming app.
Roku is the company that pioneered streaming for TV. The first Roku model, developed in collaboration with Netflix, was introduced in May 2008. Since then Roku has helped to popularize the concept of low-cost, small-form-factor set-top boxes for OTT streaming entertainment. Roku’s line of products enables users to stream content from the internet directly to their televisions. Devices that Roku provides range from streaming sticks, set-top boxes and even smart TVs with built-in streaming technology. These products run on Roku OS which is optimized for content streaming and provide access to 4,000+ free and paid channels.
First of all, it is necessary to be clear about what constitutes a channel. Channel is just Roku’s name for an app. So channel and app are simply synonyms. I will use both terms but be referring to the same thing. Starting to develop on a new stage might be challenging because of the many platform-specific needs. Roku is no different with its own SceneGraph framework and BrightScript language. Luckily, if you just want to publish your video content to the Roku store, there is a straightforward way around this issue and that is the Roku Direct Publisher.
Before starting to create your first app, you will need to create a Roku customer account and enroll in the Roku Developer Program and the Roku Partner Payouts Program. The latter is needed for any kind of monetization of your channel.
The two most complicated parts of the publishing setup follow. You will need to find a provider to host your content. For this purpose, Content Delivery Networks (CDN) or Online Video Platforms (OVP) can be used. When you have your provider make sure that content is served in a Roku supported format (DASH, HLS, Smooth, M4V, MOV, MP4).
Next, you need to set up the feed, which is probably the trickiest part. If you don’t have experience with video stream setup, you will need a developer to do this for you.
When this has been done, prepare the logo and splash screen image and you are ready to head into the Roku Developer Dashboard to create your app.
This all sounds very nice and easy, but there is a big catch with using Direct Publisher - the UI layout, account authentication, analytics, and monetization of the channel all have limitations. This means that if your channel should be just a little bit more than a pure video presentation without any need to differentiate between viewers, Direct Publisher is not the way to go.
The monthly fee for CDN/OVP is between $10 and $1000 based on the scale and customization needed. For a one-off job, the cost of a developer to set up the content feed is usually $50-$100/hour. Overall costs to make a simple app should not be higher than $1000 and if the content is ready, the turnaround should be about two weeks.
If you want to make a custom robust and long-term stable app that won’t suffer from problems connected with Direct Publisher, you should look for a custom solution. The easiest and the most cost-efficient solution is to outsource the project to an experienced firm or team which will develop the channel to your needs and requirements. Although the cost and time requirements to develop a new app from scratch are a lot higher, in the long term the positives outweigh any negatives by a mile.
When developing an app from scratch, there are almost no limitations regarding the appearance of the UI except for a few edge cases which are caused by the Roku platform itself. In contrast, when using Direct Publisher, your options are limited to only two UI layouts, both of which are very similar to each other.
With Direct Publisher, you don’t have the option to verify users on your channel. For Roku developers, there is no problem in implementing a login page.
Other important aspects of apps are payments and subscriptions. These can extend the possibilities for making money from your content and are far more effective than video ads. This is a big plus compared to using Direct Publisher, which can generate income only from adverts. I will go over more points about monetization on Roku later in the text.
Analytics data are crucial for further application development as well as for targeting users with content they might like. Direct Publisher provides only Roku’s data about user engagement. With a custom app, you can also implement third-party analytics tracking support which will help you to understand what users are doing in your channel.
The last positive of a custom-developed channel over Direct Publisher is that you can use stream protection to ensure your content cannot be used by unverified devices.
The cost of development is tightly connected with the complexity of the channel the client desires. This is why the time required for the first release ranges from two months to half a year. However, prototypes can sometimes be done in three weeks.
The overall cost of the first release is something between $5,000 to $50,000 based on the time spent and the size of the team required. If long-term support is desired, initial costs can be slightly lower.
When creating an app that should be profitable, some kind of monetization is always needed. There are three main ways how to make money from the Roku channel. These are video adverts, monthly subscriptions, and one-time purchases.
The Roku platform provides technical support for video advertisement propagation and monetization. There are two business model options allowed and provided by Roku for including video ads in channels Inventory Split and Roku Sales Representation Program.
This is the default model, where the channel sets up its own ad server and must send 30% of inventory to Roku from which Roku gains 100% of revenue. The rest of the inventory (70%) remains with you as the publisher, together with 100% of the revenue associated with this share.
If your channel had more than 5000 new installs and more than 50000 streaming hours in the previous month, you can enroll in the Roku Sales Representation Program in which Roku manages and sells 100% of your advert inventory. As a reward for your ad inventory, Roku will share 60% of its net revenue gained on ads placed on your channel (net of a 15% operational and service fee).
Roku Pay is only available in channels launched with SDK Developer. It enables you to add paid options to your channel - paywall for certain content, weekly/monthly/yearly subscriptions, charging one-time fees, payment for removing video ads, etc. There are almost no limitations. Roku takes 30% of all payments made through Roku Pay.
If you are looking to create a complex, robust and long-term stable Roku Channel, don’t hesitate to contact us. We provide a custom solution for your Roku app.
