Multi-Tenant SaaS: The answer to cost savings & efficient scaling in D2C streaming

Kirstin White | Wed Dec 20 2023 | Industry insights

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As the OTT streaming industry evolves, the importance of cost management and improving operational efficiency for broadcasters is growing. Amidst rising competition and economic uncertainty, industry-wide churn is rising. Broadcasters now need to put in more effort and resources to maintain the same revenue level. 

How can broadcasters grow their bottom line?

The short answer is raising ARPU by reducing churn and reducing costs.

Offering delightful, personalized experiences to subscribers can help carve out an edge, win loyalty, and reduce churn. This, in turn, can raise ARPU and profitability. At the same time, reducing costs without compromising efficiency is another way to boost profitability. 

How to achieve that in the dynamic OTT realm?

The easiest way is to depend on technology to deliver stellar customer experiences while keeping costs in check. State-of-the-art OTT subscriber management solutions are equipped with specialized features. They operate at the heart of data science and artificial intelligence - a critical success driver in the present day.

They present broadcasters with the advantage of:

  • Personalization of experiences
  • Extending a variety of payment methods as and when they become popular
  • Robust data security for sensitive information
  • Intuitive analytics dashboards to drive strategic initiatives
  • Churn prediction and prevention capabilities
  • Continuous technology upgrades as per the latest market developments

However, despite all these advantages, broadcasters are not using updated Subscriber Management Systems. According to a primary survey by Cleeng x Omdia, 50% of respondents use on-premises subscriber management systems. Another 23% are using single-tenant SaaS solutions. This is getting in the way of delivering excellent experiences, standing out from the competition, and raising overall profitability. 

So where’s the problem?

Examining the gap: Why are broadcasters not upgrading their systems? 

Upgrading to include the required functionality requires incurring high capital expenditure. It also involves regular maintenance and R&D expenditure to stay updated. Considering the challenging economic conditions, this expense may only be viable for some broadcasters. It raises costs and, in turn, may shrink profits.

The Solution: Multi-tenant SaaS

Overcoming technological limitations to reducing churn is achievable using multi-tenant SaaS models. This is compatible with scaling up as the platform grows. Primary advantages include:

  • Reduced fixed cost requirement: 

Using SaaS eliminates the need for significant upfront investment in infrastructure, data security, and backups. With SaaS, these burdens get shifted to the provider in exchange for a monthly fee. As a result, the latest technology becomes affordable, especially for growing broadcasters looking for a solution to scale their services on demand. 

  • Data consolidation abilities: 

Collecting and integrating data from multiple platforms is crucial in today's landscape. Nearly every business relies on diverse software applications. Managing and integrating these different platforms is necessary. However, practically doing that can take time and effort. 

Modern-day SaaS tools usually come with built-in connectors and data integration tools. This simplifies data collection from various sources, including customer information, sales data, and marketing analytics, and helps raise operational efficiencies.

  • Focus on growth initiatives:  

SaaS models eliminate the need for video service providers to manage and maintain on-premises infrastructure. Since the SaaS vendor governs the technical aspects, video service providers can focus their attention on areas that matter most. This helps immensely develop a unique value proposition and differentiate in the crowded market.

  • Cost-sharing benefit:

Multi-tenant SaaS platforms create additional cost efficiencies. Multiple video service providers share the same software infrastructure, so resource utilization is significantly higher. This contrasts single-tenant SaaS platforms, which require a separate instance of the software and infrastructure to be run and maintained for each customer.

These characteristics of multi-tenant SaaS deployments directly address and solve many of the significant concerns and critical areas for innovations that video service providers have for subscriber management. This message resonates with video service providers, and 93% of organizations actively encourage the utilization of SaaS platforms and tools.

Bottom Line: Choose Growth with the right infrastructure

Multi-tenant SaaS offers an excellent way to balance growth and costs as an OTT broadcaster. It provides the necessary tech backing to fuel strategic initiatives easily and drive success. Upgrade your tech infrastructure if you haven't already, and prime your OTT platform for maximum success. 

Want to know more facts about the Evolving Path to Profitability for OTT Broadcasters?

Read our whitepaper 

 

 

Cleeng SRM Product

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