Norigin Media – Sourcing: In or Out?
Ajey Anand, CEO, Norigin Media
Sourcing – In or Out? It is a long cyclic debate within any business – whether it’s better to build or buy. Such discussions revolve around business investments, where any spending must be weighted alongside the value of IPR ownership.
Within media and streaming TV businesses, while many have periodically switched between build and buy options, it has never been one or the other. The contributing factors are not only business mandates for ownership but also fluctuating economic climates. As seen after the pandemic, high inflation or recessions in different parts of the world, and large changes in staffing and skill-management contributed to decisions regarding spending.
Technology evolves at great speed, so in-sourcing requires large investments in training and skill development. Out-sourcing results in higher costs for key staff and loss of control or access to intellectual property. It is a hard decision, but calculable in terms of value. Businesses decide based on longer-term mandates, including ownership, but also investment capability and confidence in business verticals during uncertain times.
In a world of acquisitions and consolidations, larger businesses prefer to build, while new entrants prefer to buy stable existing solutions as they await their ROI and growth. The Media and Streaming TV industries have seen some great acquisitions with Disney and Discovery launching global brands for VOD while also acquiring tech companies to build internally. New and smaller niche entrants attempt to make their mark across the globe by buying solutions that are ready and tested.
Netflix on the other hand has always developed in-house with most of its brand identity coming from an ever-evolving product. This innate innovative building approach has been inculcated over years of perfecting a singular service where owning its IPR and brand is synonymous. The price tag for this is, of course, not provided, even on request – as with any luxury product which is difficult to imitate.
Looking at this from the other side, tech companies or teams evolve and improve by working with multiple customers on various projects where they gain a multitude of experiences. When acquired, they end up focusing on a single scope, and so there are limitations to the learning, delivery, and improvements that are possible.
My advice would be to cut your coat according to your cloth and set your TV App building or buying goals based on your limitations – of budget and capability to innovate. Grow your ambitions alongside successes that are quantifiably achieved. At Norigin Media, we do not say one is better than the other; building and buying are rather intrinsic and subjective strategies, which we support based on the needs of the broadcasters who we work with.
