Viewing on the move: The rising market of video-on-demand

A fast-paced life coupled with long hours at work and a need for change has driven the video-on-demand market in India

It would not be wrong to say that 2017 has been the year when the over-the-top (OTT) market has come into its own in India. While 2016 saw a spate of launches, 2017 has seen players largely consolidate their position. At the same time, it wouldn't be inappropriate to surmise that OTTs or the video-on-demand (VOD) or video streaming market (as some choose to call it) has permanently altered the viewership game in India.

What was viewed as a fad only a year ago has now hardened and the market will only grow from here. From broadcasters such as STAR, Sony, Zee and Viacom18 to start-ups such as Viu, TVFPlay and Hooq to production majors such as Balaji and Eros or video-streaming giants such as Netflix and Amazon Prime, you have them all vying for a slice of the Indian viewership pie today. There will be more of these as we go forward. There is already much ebing written about how Disney following its acquisition of 21st Century Fox has got right into the centre of the OTT market here as it lays its hands on Hotstar or Discovery's interest in the space at the same time. Don't be surprised if ten years from now, our first port of call is the smartphone, not the television set for our entertainment needs. We are already heading there.

Estimates peg the internet user base in India currently at around 450 million. By 2020, this base will cross 700 million, driven by the use of internet on mobile phones. Aiding this phenomenon is the growing penetration of smartphones in India, estimated at around 115 to 120 million now, and crashing data prices. Naturally, the propensity to consume entertainment on mobile phones will only grow because it will be convenient to do so.

Look around you, if you are travelling in a train, bus or car or you are in a lift or anywhere for that matter, people are keenly following their favourite shows on their mobile phones. Those days are gone when you rushed home to watch your favourite show on TV. Television shows today no longer figure as much in our conversations as they did earlier. Instead, discussion points have shifted to the next episode of Game of Thrones or House of Cards and TVF Pitchers. Forget millennials, even those over 35 are downloading OTTs and watching their favourite movies, shows and allied content on these platforms.

In fact, it is not just English and Hindi content that has come to fore on OTTs. It is also vernacular content that has got a boost, with players such as Sun stepping in with Sun NXT (in Tamil). (Plus there is a significant amount of regional content on the English and Hindi OTTs too)

On the pricing front, Amazon Prime Video should be credited with making OTT platforms very affordable with its aggressive pricing and promotion. Apart from Amazon Prime and Netflix, Indian players such as Hotstar, Voot and Alt Balaji have begun launching original content thereby bringing variety to the fare on offer. All this is indicative of one thing: OTTs are serious business ventures and not experiments at all. And all of this ground has been covered in a year to be precise.

Catch up TV is also driving OTT usage as fast-paced lives, long work hours implies that it is increasingly becoming important for entertainment giants to reach the consumer rather than the other way round. Given the ease of access and convenience of OTT apps, many prefer to catch up on TV programmes and allied shows and content on these apps while travelling or whenever they have time. Which is why even TV shows like Bigg Boss have huge viewership numbers (over 70 million views) on Voot.

Live viewership is also another factor that has driven the growth of platforms like Hotstar which has rights for IPL and other tournaments.

The opportunity: Niche, new and novel

Indian millennials are getting more comfortable with VOD than with appointment viewing on TV. This lends itself to a situation where content creators are empowered to deliver diverse content for distinct audiences. Every niche will find an audience as this medium grows and every language may have an audience as well. Just like there are over 100 channels on TV, one can expect more than 100 OTT players when it comes to digital as well. With the parallel growth of mobile internet, new users are joining the OTT bandwagon by the hour. And this is introducing new audience opportunities for the players.

The future: More branding power 

While mobile internet usage and smartphone penetration will all contribute to the growth of the OTT market here, there is one more aspect to growth that needs to be acknowledged. The explosion of digital payments such as PayTM and UPI in the last one year. Also Google’s entry into the payments space with Google Tez has ensured that this space too moves with even more vigor. Brands will capitalise on this growing trend thus increasing the scope of associations and co-branded content. In other words, OTTs will perhaps emerge as a win-win for all, equally enveloping all—content providers, platform owners and viewers in its growth story. 

The author is founder and CEO, WatConsult

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