Rotato supports transparent backgrounds in three ways.
What you'll need
Let's get the simple one out of the way: Simply choose the transparent background color in the sidebar, and hit Snapshot to render your still shot.
Rotato has a really handy, yet hidden feature: Backgrounds. Just like you can drag an image or a video onto the phone mockup, you can do the same on the background!
This method is really powerful, and requires a video editing app that supports PNG sequences. We'll use Apple's Final Cut for this tutorial, but you can use Adobe Premiere or Adobe After Effects, too.
Go to Rotato > Preferences, and check Use PNG sequence when background is transparent
You have now enabled transparency for Rotato videos. But only when the background actually is set to transparent. As a reminder, here's where you do that:
You're all set up now. Next step is to export your PNG sequence.
Depending on which resolution you've chosen in Rotato, it will take a while to finish. Once Rotato is done, a folder with all your frames will pop up on your screen.
And that's it. You now have a transparent clip in your timeline! You can drag in another video track below the Rotato clip - and, of course, above it.
But wait, this still doesn't look quite like the video above, now does it? We still need the foreground smoke.
You saw how we added the smoke video to the background, and had the phone mockup appear on top of it. Now let's also add the smoke video to the foreground!
Just one problem.
The smoke video has a black background. Simply duplicating its timeline track and dragging it up above the phone mockup track won't work. We also want the foreground smoke to enter the video from the opposite side of the screen. Let's get to work.
Your timeline now looks something like this
If you play the video now, you'll notice that you can no longer see the phone mockup! Let's sort that out.
In Effects (⌘5), find Keying, and drag a Keyer onto the new smoke clip
That's better. We can now see the phone again. But it's a little too visible, if you ask me.
In the Video Inspector, you should now see the properties for your keyer
Click the Invert checkbox
Still not perfect. There's a lot of black smoke particles we don't want there.
There's tons of ways you can refine it and make it look great. One example is in Color Selection, select Manual Color, and then drag the left hand slider knob towards the white area to filter out some of the black smoke particles.
Much better. But it's kind of hard to see the background smoke. Let's do something about that.
We wanted the smoke to come from the other side of the screen, remember? Let's get to it.
The video has been flipped. Now hit Space and enjoy your work! Keep tweaking the Keyer until you get results you like.