The over-the-top (OTT) platforms that India has had at its disposal in the recent times has been insane. Other than the usual suspects in Netflix and Amazon Prime Video, its great to see India developing its own OTT subscription service through Hotstar, VOOT, etc. But all of this points in one direction – the flourishing scenario of OTT market and a big window of opportunity for all the players in India. A report by Boston Consulting Group points towards the growing Indian OTT market and the reasons why the Indian consumers prefer the OTT form of content delivery over the other forms of content delivery. Let us look at what the report has to say.
Indian OTT Market In Next 5 Years
The Boston Consulting Group stated that the OTT content market in India is “at an infection point“. BCG then went on to describe the potential scope that the other OTT business models might have in this country, like that of SVOD (subscription-based platforms), AVOD (advertising-based platforms) and TVOD (transaction-based platforms).
In 2018, the revenue contribution of the Indian video OTT market was $500 million. A whopping 82% of the revenue was from AVOD, while the rest of the 18% was from consumer pay (SVOD, TVOD). However, by the end of 2023, this number is expected to increase tenfold! Yes, you read that right. The Indian OTT market is expected to generate $5 billion in revenue in the next 5 years. That too, with much more of an equal distribution. The predicted share is – 43% from AVOD, 32% from SVOD & TVOD and rest 25% from the global market.
After that, the report goes on to point towards the fact that there is one television in every Indian household. Hence, coordinating times so that the whole family gets to watch their favourite shows might be difficult. The OTT provides an escape to this by allowing the user to access content from an extremely diverse range as and when is convenient for the user.
Interestingly, the numbers of players in the Indian OTT market have witnessed a 3.5x increase in the last six years, growing from just nine players in 2012 to 32 in 2018.
The Types of Media Consumers In India
The people consuming the media in India has been categorized in the report to be roughly of three types. They are:- Traditionalists, OTT Experimenter and Early Adopter.
The traditionalists are used to refer to the people who consume media other than that of the OTT platform. The OTT Experimenter is similar to the traditionalists in the sense that it does have media consumption from the other platforms. However, in addition to that, it also has media consumption from the OTT platform as well. The Early Adopter refers to those people who are primarily dependent on OTT platforms for content consumption. Now, the early adopters are the ones which will drive the OTT platform forward. Still much of an urban phenomenon, it is expected to be more distributed in the years to come.
Surprisingly, a majority of consumers (81%) do not have more than 3 video or OTT apps on their phones. Probably that’s the reason every OTT player is trying too hard to be among the top 3 of the consumers’ attention.
The Untapped Rural Market
According to BCG, nearly 50% of total Internet users in India by 2020 (650+ million) will come from rural India. Interestingly, the OTT players are now beginning to target this market with the production of regional shows. This added with the boom in data consumption in the rural areas provides a great opportunity for the OTT players to profit from.
In A Nutshell
In a nutshell, the above report by Boston Consultancy Group throws light on the types of media consumers in our country, as well as the total amount of content consumed in terms of money. It identifies the potential of having such a huge consumer base and it being able to drive a $5 billion dollar Indian OTT industry in the future. In all fairness, none of the analysis seems to be out of place. People are taking to the OTT platforms in a much better manner than what they used to. Will it grow at the rate predicted in the report? With life getting busier and busier, it is very possible to imagine people preferring an OTT subscription over a normal TV subscription. Hence, the possibilities are, indeed, endless.