India's OTT Market Landscape Report 2020

INDIA’S

OTT MARKET LANDSCAPE REPORT 2020

Table of

Contents

Scope Of The Report

01

Executive Summary

02

Introduction

03

India’s OTT Landscape: An Overview

04

The Big Market Opportunity

06

Video Streaming

10

Overview

11

Landscape & Business Models

11

The Big Battle: Indian Vs International OTT Platforms

12

The Key OTT Video Streaming Players In India

18

Deep Dive Into OTT Players Streaming Vernacular Content

20

Factors Driving The Growth Of Vernacular Content

23

Content Offerings & Segments

24

India’s OTT Landscape For Kids Content

32

Kids Content & Screen Time Concerns

39

Music Streaming

41

Overview

41

India’s Music Streaming Landscape Business Models

43 46

Audio Streaming & Podcasts

48

Overview

48

India’s Podcast Landscape & Key Players Business Models

49 54

Covid-19 Impact & Trends

57

Future Trends

63

Bibliography

68

Scope Of The Report

Over the top (OTT) industry has a key reference in the digital future of media and entertainment industry. By 2030, it is estimated that a new category of ‘Digital Enthusiasts’ will be at the forefront of digital revolution. The consumers in this category will consume content in all forms, primarily on gadgets and smart connected TVs. Also, this category will not shy away from purchasing premium subscriptions for quality content.

With most of the people working from home or in complete lockdown state, OTT platforms have observed an average 15% rise in consumption of both audio and video.

Despite concerns around business model and revenue generation, so far, Indian OTT players have been successful in capturing the attention of the price-sensitive audience. Today, between the Indian and international players, the war is being played primarily on regional, originals and kids content. The entry of deep pocketed teco players like Reliance Jio, Airtel and DTH players including Tata Sky and Dish TV has only intensified this battle.

Overall, the report would provide:

Sample | © Inc42 Media | not for distribution

The ongoing COVID-19 pandemic has further accelerated the deep pocket wars.

1

This report provides an overview and insights about the rapidly growing OTT industry in India, along with a detailed analysis of the future growth opportunities in this segment.

India’s OTT Landscape Key Players Business Models Content Offerings & Consumer Preferences Covid-19 Impact Future Trends & More

Executive Summary 40+

Number Of Video OTT Players Active In India

15+

Number Of Music Streaming Players Active In India

40+

Number Of Podcast Platforms Active In India

30%

Prefer To Consume Content In Regional Language

Tamil, Telugu, Marathi, Bengali, Hindi Most Preferred Languages

Subscription

Most Adopted Business Model By OTT Players

Bundled Content Most Preferred Consumer Choice

Short Form, Originals, Web Series Sample | Š Inc42 Media | not for distribution

Content Categories Gaining Attention At Fast Pace

2

Introduction To The Report

India’s affinity to OTT video and music industry goes long back to the days of YouTube, which has been a primary choice both for video and audio content. Of late, due to the internet and smartphone penetration coupled with Gen-Z’s obsession towards on-the-go content, the on-demand-streaming segment attracted a number of new local and international players.

Covid-19 has accelerated this growth a step further. The growth that was potentially anticipated to happen somewhere in late 2021-2022, has been accelerated in 2020 itself.

India saw a 55% hike in overall streaming traffic.

Within the OTT industry, each of the three key sub sectors — video, music and podcasts have been impacted differently during lockdown. While short form video and news aggregator platforms attained the maximum traction, OTT audio players particularly podcasts are yet to reach their pinnacle.

Sample | © Inc42 Media | not for distribution

Although the overall OTT sector has gained its much-awaited spotlight, analysts have shown concerns around if it’s a temporary phase of growth for the industry. It is believed that the growth curve will get flattened once lockdown opens. However, the OTT industry leaders believe that the runway received during Covid-19 will be enough to continue their long term plans in India.

This Inc42 report contains a detailed comparison between all key local and international players in the Indian OTT segment with a deep dive into the content creation, distribution and consumption patterns in each sub-segment.

The report will serve as a go-to-guide for just about anything and everything one may want to know about the Indian OTT ecosystem. It will provide deep, data-driven insights to influence one’s understanding of this industry to make key strategic decisions in the long run.

3

India’s OTT Landscape An Overview

Going by the simplest definition available on the web, OTT platforms are those which distribute content over internet or telecom services rather than traditional cable or radio broadcast based on terrestrial or satellite transmission.

Indian consumers had their first experience with subscription-based video streaming when DTH player Tata Sky first launched its Showcase service in India in 2006. Subscribers could rent a movie for the entire day and with the fees added to the Tata Sky subscription plan. The entry of brands like Eros Now, Spuul, BIGFlix (Reliance Entertainment) in 2012 and SonyLIV in 2013 played a crucial role in keeping the growing digital user base hooked to the screens.

Sample | Š Inc42 Media | not for distribution

Since then there has been no stopping for the Indian OTT industry since then. The rise of players such as Hotstar, ZEE5, Netflix, Amazon Prime, as well as regional players like Hoichoi, SunTVNxt, Ullu among others have been phenomenal.

4

Indian OTT Industry: A Comparison Video Platforms

Music Platforms

Podcast Platforms

Number Of Local Players

28+

9+

13+

Number Of International Players

11+

7+

7+

Most Prominent Business Model

Subscription

Freemium

Not Specific, Mostly Overlapped

Key Focus

Regional Language Content; Originals; Bundled Content

Regional Language Content

Regional Language Content; Originals; Bundled Content

Key Languages

Hindi, Tamil, Telugu, Marathi, Bengali

Hindi, English, Tamil, Telugu, Punjabi, Malayalam

English, Hindi, Kannada, Marathi, Tamil

Š 2020, Inc42 Media

While international players with deep pockets have been spending massively to boost their library or add regional content, Indian players have managed to maintain an upper hand in terms of number of subscribers.

For instance, Netflix has around 182 Mn+ global subscribers, and in India, it is said to have close to 3 Mn subscribers. Without an ad-based tier, Netflix is on the backfoot compared to Disney-owned Hotstar. Hotstar claims a subscriber base of 8 Mn+ and the launch of Disney+ on Hotstar has given it a massive content boost as well.

Many Indian players such as ZEE5, Voot, Eros Now are also expanding to global markets. The Indian audience is price sensitive and the average ticket size per subscription is low, considering many individual subscribers tend to share the subscription account with friends and relatives. In UK, US, Canada and European markets, not only there is a significant audience of Indian origin, but these markets are more mature to explore subscription-based models.

The purchasing power is also higher, whereas password-sharing is less prevalent in such markets. The average revenue per user, therefore, is also higher in these countries in comparison to India.

Sample | Š Inc42 Media | not for distribution

But none of these markets offer as big an opportunity as India in terms of volume and addressable base. As the infrastructure and market matures, OTT players will find average revenue per user growing to meet the western markets, in pockets of India.

5

The Big Market Opportunity

With high bandwidth internet, low mobile data tariffs and access to the best smartphones and upcoming technologies, the urge to consume content on-the-go is growing faster than most content creators can keep up with. This has opened up an ever-rising opportunity for over-the-top (OTT) streaming players in India for both B2B and B2C segments.

Sample | Š Inc42 Media | not for distribution

According to the data released by the Internet and Mobile Association of India (IAMAI) in April 2020, India had over 504 Mn active internet users, five years and older.

Particulars

2014

2019

2025

Total Wireless Subscriptions

904.51 Million1

1,173.75 Million2

1497 Million3

Total Internet Connections

251.59 Million4

687.62 Million5

1198 Million6

Total Wireless Data Consumption (Annual)

828 Petabyte7

68000 Petabyte8

148635 Petabyte9

Data Usage Per Wireless Data Subscriber Per Month (Average)

61.66 MB10

10.37 GB11

24 GB12

Cost Of Data Per GB (Average For Wireless Data)

INR 3313

INR 6.9814

-

Market Value Of Core Digital Services Industry

-

$200 Billion24

$600 Billion25 and $710 Billion26

Smartphone Users Out Of Mobile Phone Users

21%27

29%28

40%29

Smartphone User Base

170 Million30

354 Million31

1100 Million32

Š 2020, Inc42 Media 6

Battle #1: Paywall Vs Free Customers According to a ZEE5 whitepaper, the digitally sophisticated user base preferring content behind the paywall had a cumulative size of just 18 Mn in 2018. This is quite low in comparison to the over 310 Mn digital mainstream users (in 2018) consuming video content online either free or bundled with telcos and other distribution platforms.

Indian OTT Video Streaming Players Type Of Consumer Breakdown Consumer Type

Approx User Base In Mn (2018)

Content Preferences

Mode Of Consumption

Digital Sophisticates

18

International Original Shows & Movies; Typically Behind A Paywall

Tablet | Smart TVs | Smartphones

Digital Enthisiasts

190

Indian Original Shows & Movies; Freemium Content Preferred

Tablet | Smart TVs | Smartphones

Digital Mainstream

310

Free Content Or Content Bundled With Mobile & DTH Subscriptions

Smartphones

Fringe User

10

Mobile Messaging & Free Bundled Content

Feature Phones | Entry-level Smartphones

Source: ZEE5 © 2020, Inc42 Media

Sample | © Inc42 Media | not for distribution

Crucially for OTT platforms using a subscription-only model, the ratio of only digital content consumers to mass consumers is abysmally low. This makes it harder for the likes of Netflix, Amazon Prime and others that don’t have a free tier.

13

But this strategy does not seem to work well for most. To survive, either they have to let go of the monetisation or the unique user base share. Netflix which initially came with an INR 799 per month subscription plan was forced to retreat and offer more affordable plans, which are still the most expensive among all players.

Amazon Prime Video, despite being one of the key players in the international OTT video segment, is building partnerships with telcos to distribute its content to a larger audience. A key advantage for Prime Video is the allied services provided by Amazon Prime such as priority delivery, ad-free Amazon Prime Music and more.

Telcos are monetising their own online video streaming platforms as well while also backing independent platforms. The same is true for DTH players like Tata Sky.

Bundled Online Video Content Offers By Telcos And DTH Players

Bundled Offer

Amazon Prime subscription including Prime Video, ZEE5 and Airtel Xstream app

Bundled Offer

Amazon Prime, Vodafone Play and ZEE5

Bundled Offer

Jio TV, Jio Cinema, Live TV, SUN Nxt, Disney content

Content Library

10K+ movies, TV shows, 350+ live TV channels, and content from OTT partners

Content Library

450 live TV channels, 15K movies and partner content

Content Library

670 live TV channels, 4K+ SUN Nxt movies, 1 Lakh+ hours of content

Prepaid Plan

INR 349 (only Amazon Prime Access)

Prepaid Plan

INR 249 (Amazon Prime not included)

Prepaid Plan

INR 199

Postpaid Plan

INR 499

Postpaid Plan

INR 499

Postpaid Plan

INR 199

Bundled Offer

BSNL TV

Bundled Offer

Bundled Offer

OTT platform Watcho with Dish TV subscription

Content Library

NA

Tata Sky Binge with Tata Sky set-top box (Hotstar, SUN Nxt, Hungama, ErosNow, ZEE5, Amazon FireTv Stick, Amazon Prime)

Content Library

Live TV, primary focus on Hindi language Originals

Prepaid Plan

INR 97

Prepaid Plan

INR 160

Postpaid Plan

NA

Postpaid Plan

NA

Sample | Š Inc42 Media | not for distribution

Š 2020, Inc42. Media

17

Content Library

Tata Sky On-Demand Library of TV shows and 5K+ movie titles, TV catch-up and recording; unlimited content from OTT partners

Prepaid Plan

INR 249

Postpaid Plan

NA

Deep Dive Into OTT Players Streaming Vernacular Content Vernacular content is the latest gold rush in the Indian tech startup ecosystem. Whether it is regional language content or Indian language movies, TV shows and podcasts, there’s no doubt that the huge section of the Indian population that doesn’t use English primarily is a mega-market – larger than most countries even.

According to the 2001 census, India has accepted 23 languages (including English) as part of the Eighth Schedule to the Constitution of India. Psychologists believe emotional “thinking” is an individual’s true first language which needs his mother tongue to express further. Perhaps this is the reason India has a wide landscape of players offering regional content since ages.

Sample | © Inc42 Media | not for distribution

Vernacular Landscape Of India

© 2020, Inc42 Media

20

124

Newspapers published in 22 regional languages

23

AIR originates programming 23 languages and 179 dialects

226

Entertainment, news and movie channels in 13 regional languages

45%

People have Hindi as their mother tongue

5308

Use other regional languages as native language

10-12%

Is the English speaking population, but only 8% consume OTT content in native language.

India’s Music Streaming Landscape India currently has roughly 15 music streaming players comprised of Indian and international companies. The ratio of local to international players is almost equal. Of late, video streaming OTT platforms such as ZEE5, Hoichoi, Gemplex, Addatimes, JioCinema, and Tata Sky Binge+ has also joined the bandwagon. But music is not the core offering for these platforms.

Sample | © Inc42 Media | not for distribution

© 2020, Inc42 Media

43

Media & Entertainment In India: Before And After COVID-19 Market Size Of India's Major Industry Segments In FY2019 Television Print

Industries

Films OTT, Digital News, Social Media Animation Online Gaming FM Music Streaming 0

2

4

6

8

10

Size (in $ Bn)

COVID-19 Impact Survey Negative Impact

Mixed Impact

Positive Impact

Live Events

Television

OTT

Films

FM

Online Gaming

Print Media

Music Streaming

Podcasts

Animation

Video Conferencing

Sample | © Inc42 Media | not for distribution

Digital News Social Media

Source: KPMG, IBEF © 2020, Inc42 Media

58

12

Future Trends Is this a temporary book for the video and audio streaming platforms and will the consumption remain stable even after the lockdowns end?

What strategies will OTT players adopt in the reset phase to capitalise on this consumption and behavioural shift in the audience?

Home Entertainment Will Become More Immersive When it comes to TV viewing at home, there are certain limitations. At the maximum, the DTH players like Tata Sky have been able to switch people from SD to HD. This is the prime reason people have been inclined to watch movies on a larger screen in cinema halls with 3D and 4D support.

As highlighted by Girish Menon, partner and leader – media and entertainment, KPMG India, outdoor entertainment options including – films, events, theme parks – particularly in Covid-19 hotspots could see lingering risk aversion even in the medium term.

With AR/VR devices already available at affordable prices, and smart TVs making their way into households, it will not be an exaggeration to say if the users start experiencing hi-intensity advanced versions of their favourite movies and web series genres at their home.

Most used advanced technologies in digital video making: Augmented Reality (AR) Virtual Reality (VR) Mixed Reality (MR)

Sample | © Inc42 Media | not for distribution

WebVR 360-degree Videos Digital Reality “The depth of the experience that you’re able to provide within personalized viewing at home, versus what you’re able to do in movie theatres has always been challenging because you can’t do it at scale.

But if you do it on an OTT platform, the experience can be scaled across the country. So the evolution of technology in video will benefit the larger OTT ecosystem in a big way,” said Hussain.

63

Inc42 is a leading Indian media and information platform, known for its end-to-end coverage of the Indian startup ecosystem. We work with the mission to empower, connect & grow the Indian Startup Ecosystem by providing a deep understanding of the startup economy through data-backed news and analysis.

Inc42 is the authoritative voice of the Indian Startup Ecosystem and it has brought to light the amazing stories of thousands of startups, entrepreneurs, technological innovations, businesses and many other constituents of the startup ecosystem.

Starting 5 years ago, Inc42 has now become the gateway to the Indian startup ecosystem, having published more than 25,000 stories and touching the lives of more than 25 Million people in India every month.

www.inc42.com

www.datalabs.inc42.com

Credits

DataLabs

The research wing of Inc42 Media, DataLabs specialises in producing comprehensive data-

driven and insightful reports about the ballooning Indian

startup

economy.

Since

its

EDITED & COMPILED BY Meha Agarwal Nikhil Subramaniam

launch,

DataLabs has produced over 35+ reports — covering diverse sectors such as Blockchain,

Agritech, Foodtech along with regular coverage of investments and the overall health of the Indian startup ecosystem.

DESIGNS & INFOGRAPHS BY

Aditi Goyal

DataLabs reports are aimed at bridging the Sample | Š Inc42 Media | not for distribution

information & data gap about the Indian startup economy. In the last few years, DataLabs has

produced comprehensive & insightful reports to help readers make more informed decisions at

ADDRESS

work, in investments, and more. It is responsible

Inc42 Media 59/16, 4th Floor, Jujhar Tower RD Marg, Kalkaji, New Delhi, Delhi 110019

for producing detailed reports covering the diverse industries of the Indian startup ecosystem spread across 29 states and 7 Union Territories of India.

69

Disclaimer

The data provided in this report has been obtained from public and private sources. We have made every attempt to ensure that the information presented in this report is accurate and free from any discrepancies. Ideope Media Pvt Ltd, the parent company of Inc42 Media and Inc42 DataLabs, is not responsible for any inaccuracy in the information presented or for any damages caused by the use of information provided in this report. In case of any discrepancy or errors in the data, you can contact us at editor@inc42.com and we will try our best to update the information in the digital version of the report. We are constantly updating our database of startups. Due to new startups from various domains being updated, previously reported deals and amounts might vary.

This report has been prepared in good faith on the basis of information available at the date of publication without any guarantee the accuracy, reliability or completeness of the information in this publication. Readers are responsible for assessing the relevance and accuracy of the content of this publication. While this report talks about various individuals and institutions, Ideope Media Pvt. Ltd. will not be liable for any loss, damage, cost or expense incurred or arising by reason of any person using or relying on any information in this publication.

This document makes descriptive reference to trademarks that may be owned by others. The use of such trademarks herein is not an assertion of ownership of such trademarks

by Ideope Media Pvt Ltd and is not intended to represent or imply the existence of an association between Ideope Media Pvt Ltd and the lawful owners of such trademarks.

Information regarding third-party products, services and organisations was obtained from publicly available sources, reliability of such sources or information. Its inclusion does not imply an endorsement by or of any third party. The views and opinions in this report should not be viewed as

Sample | Š Inc42 Media | not for distribution

professional advice with respect to your business.

70

Sample | Š Inc42 Media | not for distribution

71