In the last one or two years, a number of OTT (over-the-top) players or video content providers watched via internet has grown substantively and acquired a niche market for themselves despite bigwigs like Netflix or Amazon Prime investing millions to acquire the Indian market which largely consists of millennials looking for fresh content while on the go.
With new urban inclined content, a number of home-grown companies and newer players like Ekta Kapoor’s ALTBalaji, SVF-backed Hoichoi, FastFilmz, apart from channel based players like Hotstar, Voot, SonyLiv, Zee5 are now targeting youngsters approximately within the age group of 20-40.
“The next 100 million users that Netflix plans to acquire from India, are inclined towards Hindi or other regional languages which is a boon for us. We have already seen a huge growth in the last one year and am confident the next one year will see even larger growth,” said Manav Sethi, CMO of ALTBalaji.
With a team of 70, ALTBalaji is focusing on content in Tamil, Gujarati, Telugu, Marathi along with stand-up comedy. Sethi says that the content is available across 90 countries which are majorly driving the business revenues.
Explaining this, Sethi says, “In India, while it costs Rs 100 a month, we are charging $4.99 monthly outside. So with Tamil content, the traffic shoots up from Sri Lanka, Middle East, and Singapore while Hindi brings traction from UK, Canada, US.” In next few days, ALTBalaji plans to cross a million subscribers.
On the other hand, Hoichoi which focuses on Bengali content at the moment bets on bringing in more volume and different products like music streaming and more. Launched in September last year, Hoichoi has so far launched around 15 original shows and plans to add two every month.
With a minimum yearly subscription, Hoichoi sees major traction between the age group of 18-36 from the eastern region of the country and movie buffs from other states.
“At the moment we will be focusing on Bengali content but going forward we will be looking into expanding and include other regional languages as well,” says Vishnu Mohta, Co-Founder, Hoichoi. He adds that within 5 months, Hoichoi has seen a significant growth and seeing no competition in the regional market at the moment, he is confident Hoichoi will see stronger growth in the coming months.
The cost of these original shows produced by these video streaming players varies from a range of Rs 5 lakh up to 1 crore depending on various parameters like hours of the show, cast, location etc.
Regional OTT players are charging a subscriber Rs 300-400 yearly which is comparatively significantly lesser than the likes of Netflix which starts at Rs 500 a month. According to reports, roughly there are more than 25 video streaming platforms in India today.
According to Akamai’s report, the average speed has dramatically improved in the last 18 months from a 3-odd Mbps to a 6.5 Mbps. With the uptick in 4G connections, the industry experts are also welcoming the new-age content which reflects a behavioural user shift. To this, Sethi adds that the experience is targeted to be mobile-first and the content, actors, is chosen based on the audience’s preference as well.
With a different business strategy, Mumbai based digital media company Culture Machine is also eyeing this sector. Sameer Pitalwalla, CEO and co-founder of Mumbai-based says that the market is still quite nascent.
“It’s a deep pocketed game and investors are still not confident about the market with big names already being present. But, in the long run, video content is bound to take over as TV growth rate is slowing down and mass programming content is not in demand anymore.” Culture Machine runs Put Chutney, a Tamil web channel and plans to launch content in other vernacular languages too.
Gauging the growth of the sector, Frank D’Souza, leader of media and entertainment segment at PwC, says that the OTT players are right now competing with television content which has far wide reach at nominal charges. “If you are using OTT, it’s just not subscription charges but also data that one is paying for. Moreover, advertisements still prefer TV over OTT since effectiveness can be measured.”
According to global media and entertainment outlook 2017-2021 report, an Indian consumer spends $32 yearly on entertainment. However, betting that OTT will be the future, D’Souza says that it will develop just like television did decades back and depending on quality regional content is the only way forward.
Bengaluru-based video streaming player FastFilmz that focuses only on southern languages, has 100,000 paid subscribers currently but is concerned that in the long run disproportionate funds and bigger players might halt growth for smaller players if VC’s interest is not high. “Although we have a good share of paid users, sustainability will be a major problem with Amazon and Netflix already present in the market,” Karam Malhotra,co-CEO of FastFilmz told ET.
Meanwhile, few domestic content aggregators have also mushroomed up. One such is New-Delhi based GoldSeat that is partnering with inter-city bus operators and is also looking to partner with airways once Wi-Fi is permitted in-flights.
“We play in the arena where there is no connectivity when you travel. For instance, when you are travelling to Ludhiana or Manali, you experience about only 20% connectivity. With our LAN connection, we stream media on your phone making it a personal seamless experience.” GoldSeat has so far partnered with Reliance and Phantom.
Even ALTBalaji bets a major share on its partnerships with Vodafone and Jio and expects to drive growth in smaller cities with these partnerships. “Partnerships will help us reach out to the next 80 cities,” says Sethi.
