India’s OTT market has potential to reach $5bn by 2023: BCG Report

The number 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, says the report

e4m by exchange4media Staff
Updated: Nov 21, 2018 8:22 AM

With India’s appetite for entertainment growing at break neck speed with high speed broadband connectivity, ease of payment options and availability of multiple platforms, the country’s OTT industry is poised to reach $5 billion by 2023, according to a study by Boston Consulting Group (BCG). The report also mentions that 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.

Titled ‘Entertainment Goes Online’ this report seeks to address the needs of the changing Indian consumer, learnings from other global markets, niche areas such as internationalization, music and regional acting as the key strategic imperatives and the agenda which can drive success in a market.

Overall, it is estimated that 16 percent of media consumption in India is already on digital media. Relative to developed countries, India is lagging. However, for the Indian youth, already 25 percent of media consumption is digital. This indicates that the growth in India is likely to catch up.

The digital consumption (relative to traditional TV and print) in India has been additive and not cannabilizing traditional media consumption.

The report has also identified three types of customers in the Indian market. The first ones are traditionalists, who primarily consume content on platforms other than OTT channels. Experimenters are the second type who have significant consumption on both conventional and OTT platforms. The third ones are the early adopters, whose primary consumption occurs on OTT platforms.

When it comes to investment on content made across OTT platforms, BCG report observed varied forms with different propositions:

 • Tent poles or hero content: heavily marketed, premium content (higher cost of production) aimed to bring new eyeballs on the platforms

• Hit movies: high budget movies which are expensive to buy, but attract eyeballs

• High profile sporting events

• Syndication of international content

• Original content / web series (Hindi, English and regional); build up library of differentiated content

• CAC (Content around content) specifically around reality TV, sports and others also covered on traditional TV

The report hinted at the possibility for multiple types of OTT models in India like subscription-based, advertising-based as well as transaction based.

Challenge lies with the retention of consumers where all platforms are struggling. According to the report, 81 per cent of consumers have up to three video/OTT apps on their smartphone. On an average 50 per cent of OTT apps installed are uninstalled in the first seven days of installation. The competition for user share is intense—every OTT platform is vying to be among the top three of the consumer’s attention.

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