Content providers are constantly looking for ways to reach their target audience and empower consumers in order to offer a compelling experience. This is leading to a growth of OTT in India.
Traditionally, multichannel television and broadcasting platforms were used as a medium of communication to the consumer, and it is still used in many parts of the world. This mechanism is dependent on the controllers or distributors of content. Content owners have created businesses that seek new ways to reach their customer base. OTT streaming media has become the preferred way to reach the audience and deliver great user experience—putting the consumer in the driver’s seat. As a result, content creators became producers, turning the broadcasting world on its head. This created great opportunities for content creation under well-known OTT banners, such as Amazon Prime, Netflix, Hulu, and more. A by-product of this content creation method is that it allowed bypassing content certification, thereby encouraging freedom of expression.
This is where we stand at the moment. Businesses, both on the content creation side as well as those leveraging this phenomenon can really benefit from the use of streaming media. They hold the power to increase eyeballs on the regular broadcasting avenues. Case in point, Star India, a subsidiary of The Walt Disney Company, India provide sports content to viewers via the typical sports broadcasting channels that reach the end user through broadcasters. Additionally, they have the same content reaching consumers through streaming media via an entity called Hotstar.
While the traditional channels provide ad revenues, by using OTT they have now created a new business stream to generate subscription revenue and a new medium for ads too.
Sony Pictures Network India Pvt. Ltd., too have a very similar ecosystem. They provide all their content leveraging streaming media through SonyLiv while maintaining their broadcasting channels.
The single objective of content creators and providers is to create a magical experience for the consumer and gain the latter’s loyalty. This demands high-end analytics to keep the consumer interested and engaged. Netflix provides you with a % match of the content you preview based on your previous consumption. Obviously, this helps in better user experience as you get to view relevant content, which is tailored to your preference.
As we go forward, there is a sense that businesses will align more with streaming media. This will create new business avenues and entities. With more eyeballs moving to streaming media, the advertising ecosystem will also align with it. Companies such as, Netflix, Amazon, and a host of Indian providers are well positioned to take advantage of this change. There is a good chance we will start seeing an explosion of ads within the streaming content provided by them.
With the ongoing maturity of OTT in India, the advertising ecosystem will move decisively towards streaming and businesses will mature to have business models around subscriptions and ad revenues.
As a medium, the proliferation of smart phones and high-speed Internet with increasing bandwidth is a great facilitator for OTT or Video on Demand (VOD) penetration. India’s OTT subscribers are expected to grow to 105 million by 2020, according to a report by Media Partner Asia.
Given the opportunity, more and more businesses, both national and regional, are jumping on to the OTT bandwagon. The more mature businesses are focusing on deep insights to engage subscribers and provide a magical experience. Understanding customer behavior and leveraging it for business opportunities using artificial intelligence is a clear trend that we are seeing currently.
This also helps in deciding the content cost to be optimum to encourage subscriber stickiness. From a technology perspective, ensuring a seamless OTT delivery is another key aspect that businesses are looking at to ensure the happiness index of consumers.
OTT or VOD is clearly making significant inroads into how content consumers ingest content. It is a great opportunity for Indian companies and content producers to invest in creating/maintaining an ecosystem that has a lot of potential in the future.
By Rajesh Kurup, EVP – Media & Advertising, Cybage