Facebook and YouTube will help faster adoption of non-linear forms of consumption: Vamshi Reddy

Vamshi Reddy, Founder, Apalya Technologies talks about what works in the OTT space, its monetisation potential and Apalya’s association with HUL

e4m by Madhuwanti Saha
Updated: Aug 16, 2017 7:50 AM


India’s OTT space has always been a tricky game to crack when it comes to monetisation and marketing. Whether it’s AVOD or SVOD, both models are burning cash for customer acquisition and retention. In this context, we get an insight from Vamshi Reddy, Founder, Apalya Technologies, which has worked with Vodafone India and Sun TV Network for Vodafone Play and Sun NXT respectively with its 'myplex' proprietary OTT platform. The platform helps in acquiring customers, managing them, partnering with media owners and giving their partners all-round support and services. The company is looking to sign a few deals in South East Asia, the Middle East and Africa. 

 

Reddy shares his take on the OTT space, its monetisation potential and Apalya’s association with HUL.

 

What is the monetization potential of the OTT space? What kind of model works? 

 

From all evidence at this point, monetization is a journey which will begin with habit formation, demonstration of value through not just content but also the user experience and the fine tuning of payment mechanisms to come together and really bring home the money. Ad-supported models will certainly be a quick win along this road and will continue to be the bulk for most services but we will have to tackle the tougher challenge of subscription sooner than later. Once we start doing that, the potential is huge. We are already at 420 million internet users on the mobile. Even differentiated audiences of 10–20 million from among these will be a viable proposition for advertisers and businesses as well as subscriptions.

If you take our clients, Sun NXT is a paid service. Vodafone Play was a free service but is going the paid route. However, Vodafone is seeing a 5x growth in terms of data usage. Indirectly, it is working for them. 

 

What kind of marketing works in the OTT space?

 

There is no one form of marketing that works. Targeted video ads, pay-per-view models, free subscription offers—all have an impact on consumption. Some OTT players are showcasing exclusive content to differentiate themselves and acquire new users. 

 

We have observed that a successful or effective service is one that judiciously marries a well-defined content strategy to an insightful product strategy, which in turn takes into account the peculiarities of a user’s behaviour and the ecosystem. For example, the importance of downloads in a market where the network conditions can be inconsistent, things which keeps the user experience front and centre.

 

At Apalya, we are trying to solve a part of the marketing puzzle by building a recommendation engine and improving data analytics which is the core of any OTT play. Our aim is to try and understand the consumer better so we can give them what they want, the way they want. 

 

Can you share some insights on customers’ tastes when it comes to content acquisition and management?

 

At this point, we are seeing a sudden increase in the amount of content across all sources and services. A lot of it does have similar tonality of bold themes, characters and execution and is predominantly for the younger audiences. This is understandable as they will be the early adopters in this space. But we will need to see a lot more variety in the themes and execution to start getting real insights.

 

So what’s your take on the OTT scene right now?

 

It has become imperative for most content owners and creators to get some clarity on their plans. We have a very large audience base and once you apply the cuts of regionality and psychographics, a lot of viable audience segments will emerge. 

 

While there will always be that one or two large horizontals that cater to everyone, we will have room for more specialised and distinctive plays. The good times will roll for those who last until then.

 

With Facebook getting into content creation (via their collaboration with content partners,) how do you think this is going to affect the future of OTT players?

 

Facebook is a distribution avenue and among the most powerful ones today. It is too early to measure its impact on OTT players. It will definitely be a significant avenue. But then we also have YouTube which didn’t stop the rise of specialist OTT platforms. Our view is that major networks like Facebook and YouTube will help faster adoption of non-linear forms of consumption. That’s a good thing for everyone.

 

Tell us about your recent association with HUL. 

 

We used our mobile video expertise to help build a consumer-facing mobile video service for HUL called Krispy, an app that rewarded viewers for watching videos as cash-back. This was a non-traditional format to work with. We used our video expertise which helped them engage with their consumers at a daily level through entertainment (mixed with advertising) and also gave them an insight into consumption behaviour through the mobile.

 

How has your flagship product Myplex helped the OTT space? 

 

Myplex is an end-to-end, plug and play OTT solution that encompasses all the components required for a state-of-the-art service. We take care of not only deploying the platform but also integrating it with all specialist services like billing, analytics, DRM and engagement that a modern OTT solution needs. 

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