India has a population of around 1.4 billion people. With an average age of 29, the country has one of the youngest populations in the world, with about 70% of the population being under the age of 35. The desire and appetite for entertainment is enormous in such a population. Over The Top (OTT) is a media streaming service that provides content to users online over the internet. Over the last decade, the OTT business has made great strides, challenging the old television paradigm and fundamentally changing the way consumers watch entertainment and media content.
OTT market revenue is anticipated to surpass $205,565 million globally in 2022, with India accounting for over $2,673 million of that total. By 2026, this market is anticipated to increase at a Compound Annual Growth Rate (CAGR) of 10% and surpass $3,928 million, making India the second-most important market after China.
OTT platforms have grown dramatically in India in recent years. This can be attributed to a variety of reasons, including growing income levels, increased Internet and smartphone adoption, good service quality, and affordability. Following COVID-19, India saw the largest growth of any global market, with a 28.6% CAGR. These elements will be further discussed in this article.
PANDEMIC INDUCED BOOM
Although OTT platforms first debuted in India in 2008, it wasn’t until the larger companies in the streaming industry, such as Netflix and Amazon Prime, emerged that the Indian public became interested in this kind of media consumption. However, the true OTT boom occurred when the majority of the population was trapped indoors owing to the 2020-21 COVID-19 pandemic and their options for amusement were confined to indoor activities. Prior to the pandemic, access to OTT platforms was regarded a privilege and was limited to a largely urban and middle-to-upper-class populace.
An Indian viewer is reported to spend close to 11 hours on average consuming video content on OTT platforms, that’s around three times more than what people watch worldwide. This illustrates that Indians mostly watch video content online. Furthermore, during the COVID-19 Pandemic, the number of persons who subscribed to an OTT platform surged by a whopping 70%.
CHOICE WITH CONVENIENCE & VALUE
OTT platforms are simple to use and require only a few items such as a stable internet connection, a smart TV or a smartphone. The total cost of OTT usage is determined by the internet data package selected as well as subscription fees for the OTT platform, if any. The charges are thus lower in comparison to traditional cable network charges. As internet is accessible from anywhere, at any time and from any device, it becomes easy to access content on OTT platforms. This freedom to locate OTT services makes it easy for viewers to view their preferred contents. Thus, an OTT platform’s freedom of location makes it very convenient for viewers to watch their favorite content regardless of network carrier. Additionally, the ability to watch or upload videos from smartphones allows live video streaming from anywhere and at any time.
OTT platforms provide a wide range of content, with the majority providing both free and paid content. Subscriptions allow viewers to become premier members, but even without subscribing to OTT platforms, a viewer can watch a diverse and nearly limitless amount of content.
MOBILE PENETRATION ACROSS INDIA
The cell phone has evolved into one of the most popular streaming devices in India as a consequence of the widespread broadband internet penetration in the nation. India, which has the second-largest OTT consumers worldwide, has highly a competitive OTT market with well over 45 OTT platforms. Both well-established businesses and new entrants in OTT landscape vie for customer attention with aggressive pricing and offers. For example, Netflix India offers as low as INR 149/- per month subscription for mobile devices only.
The telecom industry’s unprecedented growth has meant better connectivity over both fixed and wireless networks, which is yet another massive benefit for OTT platforms. Majority of Indians use the 4g network, which provides not only high-speed data but also a fairly high limit. Users can stream videos regardless of their location as long as they have the appropriate app installed on their device. Furthermore, OTT platforms do not necessitate any additional hardware, such as a set-top box or an antenna. As long as their mobile has a working data plan or WIFI access, they are good to go.
Based on a recent PwC report, the OTT market will grow at a rate of 22% over the next 3 years. The deployment of 5G networks will provide a boost to OTT platforms. Businesses are driven by continuous connectivity, mobile platforms, competitive pricing for end users, and personalization offerings. The availability of 5G wireless access will undoubtedly push and encourage consumers to stream OTT material more often, perhaps making this way the dominant mode of digital media consumption. OTT appears to be one of the sectors that will benefit the most from 5G rollout, as it delivers superior data streaming speed, dependability, and enhanced video delivery potential.
FLEXIBLE SUBSCRIPTION PLANS & PAYMENT OPTIONS
Unlike DTH/Cable, where subscribers are given options that are barely distinguishable from one another, OTT platforms provide simple subscriptions. Users receive an all-access subscription with just one Amazon Prime subscription, whether monthly or yearly. Depending on how many screens are in use, Netflix provides a variety of options. Other major regional platforms, such as Alt Balaji and Viu, provide ad-free subscriptions to premium users. The terms and conditions are straightforward, with no hidden strings attached, and users can cancel their subscriptions at any time without disrupting services until their current subscription expires.
Subscription payments can be made digitally using debit/credit cards, digital wallet or UPI, or Amazon pay wallet if the subscription is for Amazon Prime. Subscribers also receive text/email reminders for payment.
COLLABORATION WITH TELECOM COMPANIES & DTH SERVICE PROVIDERS
Telecom Companies are collaborating with OTT players to grow their subscriber base by providing free subscriptions and unlimited online streaming. For example, AIRTEL and ZEE5 announced their partnership in May 2020 to bring online entertainment media to its customers in India. AIRTEL has also collaborated with Disney+Hotstar to provide viewers with high-quality video entertainment.
To provide a more balanced viewing experience, OTT platforms and DTH service providers are collaborating. Take into account Tata Sky, the market leader in DTH services in India. Tata Sky has recently rebranded as Tata Play. They expanded their commercial interests beyond DTH services two years ago by incorporating OTT apps on their interface. Despite its origins as a DTH distributor, the company is now primarily a content distribution company. Users of Tata Play now have access to on-demand entertainment. Consumers can access both broadcast television channels and OTT content via a single user interface.
DIVERSIFIED & ORIGINAL CONTENT
While some English content is still being streamed in the form of popular movies and international TV series, the majority of OTT players are focusing on sharing Hindi and other regional language-based content. The current emphasis is on a specific regional audience. Thus, the creation of a repository of regional language movies, web series, and so on is seen as a strategic move, and most OTT players are focusing on producing original regional content to keep audiences engaged.
The main reason the Indian audiences have switched to OTT platforms is because the content is so different and fresh when contrasted to satellite TV channels. On Prime and Netflix, one can watch almost anything, from movies to web series to original shows. The originality of the content is important, as is the fact that they now have the option to watch shows from all over the world rather than just India. Both Amazon Prime and Netflix have been focusing on content specially tailored for the Indian market. HotStar was the official partner for the Indian premiere of Game of Thrones.
With contemporary viewers and viewers constantly looking for more edgy, exciting, and unique storylines, OTT platforms were indeed clear winners as they are concentrated on premium content rather than quantity. Platforms such as Amazon Prime and Netflix have responded to the growing demand for new and original content. Amazon Prime has several original web series and stand-up specials aimed at the Indian audience.
INCREASED DEMAND FOR REGIONAL CONTENT
During the pandemic, India also witnessed an increased demand regional entertainment. The era of a nation-wide lockdown opened avenues for viewing vernacular and multi-cultural content. OTT companies, production houses, and investors saw a huge opportunity and a great source of growth and began capitalizing on the rising demand for local language and regional content. Since their inception, regional OTT services have been steadily capturing the Indian market and meeting the demand for local language content.
Given the OTT platforms’ content-centric policy, Punjabi, Marathi, Bengali, and South Indian movies have attracted a considerable audience. Regional cinema, particularly low-budget films, has attracted a sizable following for its substance. OTT with its phenomenal reach has provided a fantastic avenue for regional film to entertain non-Hindi speaking Diasporas over the world. HOICHOI, an OTT platform based out of Kolkata, reportedly gained 13 million subscriptions in September 2020, and the Bengali audience not just in India but also in Bangladesh contributed to the unprecedented increase in revenues.
As several OTT platforms compete for consumers’ attention, original premium content, particularly in regional languages, is one of the most important growth drivers and differentiators. According to reports, Tier II, III, and IV cities and regional languages speaking audiences will drive the next stage of growth in the OTT landscape.
CONCLUSION
Consumers in India have never had as many options for home entertainment as they do now, thanks to the ever-growing number of OTT platforms. Many factors have contributed to the enormous success and popularity of OTT platforms among viewers. It includes inexpensive data, variable pricing models based on user budgets, premium content, and the COVID-19 pandemic, to name a few.
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