Over-the-top (OTT) players will take a deep dive into offering regional content in 2017 propelled by a boom in the telecom sector and the government’s move to connect all of India with reliable data networks.
The regional language revolution is taking off and is evident from the slow shift in content strategy of OTT players in India. Sony Liv, a major player in the OTT market, entered the regional OTT space earlier this year with a Marathi web-series, YOLO. YuppTV is one of the very few OTT players that covers nearly 10 Indian languages and offers original web-series in these regional languages in addition to catch-up TV. And platforms like Hotstar and DittoTV cater to regional audiences through a wide selection of TV shows and movies in regional languages.
Even international players like Amazon Prime and Netflix have taken a plunge into the regional content space. Both the OTT players have gradually increased their selection of regional content; Amazon Prime recently tied up with Bengali cinema’s Shree Venkatesh Films (SVF) to expand its Bengali language content. Given the scope of the market, the space to grow in the market is very high. “The regional OTT market is a fast-growing market, which has not been captured by any single player yet,” says Vinay Pillai, Co-founder, Dekkho.
Of the regional languages on offer, content in languages like Tamil, Telugu, Bengali, Gujarati, Marathi, and Punjabi have many takers. Consumer insights show that specific content types and increase in production quality of content are driving regional content. Pillai explains that “Punjabi drives a lot of music content, Gujarati and Marathi shows focus more on food, fashion, lifestyle kind of content, and Tamil and Telugu see a lot of short-form content like TV shows.” He adds that previously, vernacular language content was seen as inferior to Bollywood, but in the last couple of years the quality of content in regional languages like Tamil and Bhojpuri has increased and regional content has become more mainstream.
Given that OTT players completely rely on technology, affordable smartphones, internet penetration and increase in bandwidth are the key factors that drive growth in this sector. YouTube, or any free to use platform grew at 90–110 per cent since the launch of Jio of which 30 per cent growth was attributed to regional content, say industry experts.
While top OTT players entered the Indian market with catch-up TV and international content, regional content will be the future of OTT players. “Regional content will become critical with 4G and internet penetration reaching small towns where the first language may not be English or Hindi. And the share of regional content in the overall consumption pie will increase,” says Uday Sodhi, Executive Vice President and Head - Digital Business at Sony Pictures Networks. This growing demand is something that leaders in the OTT space, international players, and fairly new OTT players have all recognized.
Currently, internet penetration in urban India is at 60 per cent tending towards saturation, rural India has 17 per cent internet penetration with approximately 750 million potential untapped internet users.
“The ecosystem around OTT players is changing with the telecom boom. The new generation of users that will come onboard will be from tier-2 or tier-3 cities. When the 600-700 million potential users from rural India come on board, there will be a higher demand for regional content,” says Dushyant Kohli, Head Growth, nexGTv. Kohli adds that currently almost 40 per cent of the content consumed on nexGTv is regional content. He says that data cost-conscious users from tier-2 or tier-3 cities will now get on the data bandwagon with the entry of players like Jio and the increasing competition to provide data at cheaper rates.
This infrastructure development will translate into high growth potential for the regional OTT space. “Regional content growth will contribute to at least 35–40 per cent of the growth in terms of viewership and overall user growth, for the next five years,” says Pillai.
Regional original content will contribute to significant growth of the overall OTT sector in the years to come. “In terms of commanding advertising revenue, we feel that regional content will make up for 20–25 per cent of the overall share. Post 2019, it will hopefully grow and touch the 40–45 per cent mark,” says Pillai. He noted that in terms of watchtime, regional content is growing at the bare minimum of 2.5 per cent. Pillai expects that when viewership shifts to big screens from mobile screens, watchtime of regional content will grow at least 4 to 4.5 times the rate at which Hindi content is growing.