Hotstar has reached 300mn monthly users: Uday Shankar

Shankar, President of Walt Disney Company Asia Pacific and Chairman of Star & Disney India, spoke at the Disney Global Summit on April 11

UdayShankar

At the Disney Global Investor Summit held on April 11, Uday Shankar, President, Walt Disney Company Asia Pacific, Chairman, Star & Disney India, revealed that Hotstar has reached the 300mn monthly active users mark. He also

explained in detail how Hotstar managed the feat that makes it one of the largest video platforms in the world and what the OTT platform is ready to offer in the next few years.

Giving an insight into the Indian market, Shankar explained, “India is the largest growing economy in the world. Currently the sixth largest, it has hit this milestone in less than three decades. GDP growth has averaged 8% over the last decade and the trend is projected to continue. By the end of the next decade, it will be the third largest economy in the world. A key driver of this growth is favourable demographics. We are talking about a market that has 600mn consumers below the age of 25. That by the way is the largest youth population in the world. Besides the general power of consumption of this demographic, this is also a population that is extremely comfortable with modern trends, including digital media consumption.”

Shankar also pointed out how the purchasing power has grown in the country. “India has a strong and rapidly growing middle class. The number of households earning more than $8,500 a year has grown by 10% annually. And this segment will constitute almost half of the population by 2028. If you consider purchasing power parity, discretionary consumer spending in this market is going to be extremely attractive and the media industry is set to be a key beneficiary.”

In his speech, he spoke about how there is every indication that mobile is set to be the primary screen for the largest segment of Indian population. The ones who are affluent are opting for mobile as their personal screen and the not-so-affluent are having their first screen experience on mobile phones. “The trend will continue to get stronger and as a result, India is set to have more internet users than the entire population in the G7 countries put together. In the next five years, India will have over a billion video screens. However, what is most exciting is the rate at which wireless data is becoming available and affordable. From one of the most expensive data markets in the world, data costs have crashed to as low as 2 cents per GB today. All of this while, access to data has exploded. In just 2 years, per capita data usage has shot up 12 times on account of video streaming. Today, an average Indian viewer already spends two and a half hours on video every day. In the next five years, it is set to double to five hours/day. Smartphones are going to drive that search.”

That is why India has emerged as a thriving market for advertising as well as consumer payments. “Together, advertising on TV and Digital is projected to grow at about 20% annually to $14bn in the next five years. Hunger for content and ability to pay are also unlocking growth in consumer payments for video. That market is expected to be $12bn in next five years.”

Speaking about how Star India has contributed to this rapid growth of consumers, he said, “Our business Star India has played a key role in shaping this market so far. Driven by our strength in content and our uniquely successful digital video delivery platform Hotstar, we have pole position in this incredible market. In the last two decades, Star has created unparalled capacity to produce market-leading entertainment and sports content in no less than 8 languages. For every 4 hours of TV watched in India, one hour is on Star. Star broadcasts 250 days of live sports every year and has 65% share of the sports viewership in India. Hotstar has just broken the 300mn monthly users mark that makes it one of the largest video platforms in the world.”

Shankar then explained how the network has managed to make those numbers believable and achievable. “First and foremost we were ahead of the curve, when everybody was dismissing India as a data-dark market, we anticipated the impending shift and built Hotstar. We also kept mobile, and in particular android, at the centre of our strategy and created an app that was high quality feature rich but it was also light and nimble. We also put all of our television content on Hotstar almost simultaneously with its linear airing. Given the large Indian population, we built Hotstar for scale and focused on creating a scaled advertising platform too rather than focusing only on the nascent subscription market. Today it accounts for 40% of all long form video consumption in India. Star has always been interested in creating and owning Intellectual Property. Today that rich library is serving us very well.”

Shankar also revealed that Hotstar is home to over 1,00,000 hours of drama, movies, sports and news on a single platform and several times this volume is available in their library.

“We have also localised our sports offering. Cricket has always been an obsession in India. But for decades, its reach was limited because it was served largely in English. We took cricket deeper and made it more accessible in Indian languages. The success of our strategy is reflected in the improved performance of IPL last season. Localisation and creativity also led us to develop uniquely Indian sport like kabaddi, which has already become the number 2 sport in India.”

“Today, Star captures almost 30% share of all TV advertising, and almost 30% share of all digital video advertising as well. It also takes 40% of all TV affiliate revenues. Our goal is to improve this share further with a cross screen advertising engine. In this enterprise, the key goal has been to enhance consumer engagement. Hotstar is arguably more advanced in engagement initiatives than any other service in India. These include gamification of content, social experience around video and even allowing in-app transactions now. As a result, an active viewer spends 2.7 times more time on video than a passive viewer. We are pushing for even deeper engagement. We believe now that the Indian market is ready for a subscription push and that’s why we are on the path to use Hotstar’s massive scale as an AVOD platform to establish compelling SVOD service for the top-end consumers. This is driven by premium content and an easy transaction experience. It is satisfying to see what we have created so far,” he said.

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