Regional OTTs on the rise as native audiences demand local language content

Last one year has seen regional OTT platforms mushrooming in markets like Maharashtra, Gujarat, Kerala, Karnataka, Andhra Pradesh-Telangana and Tamil Nadu

e4m by Javed Farooqui
Published: Aug 3, 2021 7:58 AM  | 8 min read

With most of the big over the top (OTT) platforms focussing primarily on Hindi content, a new set of OTT platforms are emerging in the regional markets that cater to local tastes and preferences. Unlike the big players, who are targeting a large and diverse audience base, the regional OTT players are firmly focussed on meeting the content needs of native audiences.

The last one year has seen regional OTT platforms mushrooming in markets like Maharashtra, Gujarat, Kerala, Karnataka, Andhra Pradesh-Telangana and Tamil Nadu. Some of the well-known platforms in this space are aha (Telugu), hoichoi (Bengali), Planet Marathi, Koode (Malayalam), and City Short TV (Gujarati), among others.

This trend is similar to one that was seen in the TV broadcasting space more than a decade back. Sensing an opportunity, broadcasters like Star India and ZEEL had launched regional channels in a bid to expand their business outside the Hindi-speaking markets. OTT is following in the footsteps of TV broadcasting.

In fact, platforms like hoichoi and aha have managed to build a strong subscriber base in their target markets. However, the regional OTT platforms have their own set of challenges like limited investment capacity, competition from bigger OTT players and lack of clarity on business model.

According to a FICCI-PwC report, the share of regional language consumption on OTT platforms will cross 50% of total time spent by 2025, easing past Hindi at 45%. It further stated that content costs will continue to increase as the overall quality benchmark rises to address the needs of a more aware audience, particularly across regional markets.

Buoyed by the opportunities that regional OTT space presents, the promoters of Bodhi Tree Multimedia, with the backing of Sumukha Capital, launched Studio Bodhi, India’s first OTT focused regional content studio. The studio has plans to create two shows each in Tamil, Telugu, Bengali, and Marathi in 2021 and 2022.

"The whole idea was that the second wave of OTT will be regional considering that most of the broadcast consumption in India is also regional. Almost 45% of all consumption on streaming was supposed to be regional. It is a matter of time before we have a strong and robust regional OTT ecosystem. It will be interesting to see how it will evolve," said Mautik Tolia, Managing Director, Bodhi Tree Multimedia.

Tolia said the need for regional OTT content is huge, however, it remains unaddressed. "Even at the current internet penetration, the regional market is unaddressed. There are limited shows being made for regional markets. Eventually, a lot more shows will get made which will lead to more viewership," he added.

Studio Bodhi will produce regional shows and sell them to OTT platforms. The budget for an OTT show ranges anywhere from Rs 2 crore to Rs 20 crore, particularly in large markets like Tamil and Telugu.

Filling the void

Koode, which is owned by Studio Mojo, was among the early movers in the Malayalam OTT market. Studio Mojo is focussed on building regional programming, especially in south, through a creator network. Through Koode, it aims to provide a platform to budding content producers.

"Most of the big OTT platforms don't have an original programming plan at all for regional. None of the big platforms are interested in a language like Malayalam particularly when it comes to original digital content. Even in big regional markets like Tamil and Telugu nothing much is being done by the big players," said Studio Mojo Founder and CEO Radhakrishnan Ramachandran.

Soumya Mukherjee, Head of Operations and Strategy, hoichoi, noted that the demand for quality content on OTT in regional languages is on the rise. "Regional content should do well in the country because there is a considerable addressable market to cater to. Bengali is spoken by 250 million plus people in the world which is roughly the population of US. It is also the sixth most widely spoken language in the world. That gave us a lot of confidence to launch hoichoi. We were among the first regional OTT platform in the country."

Marathi OTT platform Planet Marathi made its debut on 30th June with a digital movie premiere. "We saw a gap in the market as there were no Marathi specific platforms and even bigger OTT platforms, barring ZEE5, are not focussed on original Marathi web content," said Akshay Bardapurkar, Founder, Planet Marathi, adding that regional is the new national.

Planet Marathi is targeting 24 crore Marathi-speaking population which is spread across Maharashtra, Madhya Pradesh, Telangana, and Karnataka besides Marathi diaspora. It will target urban as well as rural audiences. The Marathi OTT platform will focus on direct subscriber acquisition rather than riding on telco and cable/broadband platforms. "Creating quality content is the biggest focus and backing that up with aggressive digital marketing," Bardapurkar said.

Anant Roongta, Managing Director at Famous Studio, said that the user base across regions is expanding thanks to high-speed internet. "Major consumption comes from Tier II and Tier III cities where people now have access to smartphones which has enabled them to consume content on OTT. Regional content and local lingo is what resonates with such audience and that has successfully reshaped the regional storytelling on the digital medium. Regional content has unexplored potential and the ability to establish a strong connect with the audience."

Roongta believes that regional content has unmatched potential with compelling plots and earthy performances which is now getting the recognition and reach it deserves. "India is a country with rich heritage and culture brimming with stories that are worthy of a far-reaching platform to connect with its target audience. While the mainstream movie business focuses on commercial cinema, regional content on OTT is actively becoming a passage to showcase our tradition, and explore the layers of the local talent pool in the true sense.”

Finding the right business model

Studio Mojo's Radhakrishnan admitted that revenue model is a big challenge. "Taking on the big guys is itself a big task. Their content budgets are huge. We are following the model of amplifying good creators by working with them. Transaction VOD (TVOD) model is a good model for platforms like us. We are working on shorter duration movies which can be sold on Pay Per View basis (PPP)," he stated. Besides TVOD, he is also betting on branded content for regional brands.

Radhakrishnan feels that OTT platforms should not restrict themselves to shows and movies. "We have also tied up with India Today for Malayalam version of ESPL. OTT is not just about movies or original shows but about building highly interactive communities. We are also looking at building a gaming audience," he stated.

To grow Koode's reach, the company has done distribution deals with big players like Jio Fiber and Asianet Satellite Communications locally. "We will seek funding once we build a good product. We will launch our app in Middle East which is a large market for Malayalam content. We are looking to launch Koode in Tamil and Kannada also," said Radhakrishnan on his future plans for Koode.

Planet Marathi's Bardapurkar concurred with Radhakrishnan. The Marathi OTT platform is also building TVOD model. It will also launch subscription plans soon. The platform has 24 originals with plans to launch two shows a month. It has 120 titles in its film library. It will also get into gaming.

"Currently, we have TVOD model, and we will launch SVOD model soon on our platform. We will acquire films which didn't release due to pandemic besides commissioning content. We will have web series, movies, drama, music and later gaming on our platform," he stated.

hoichoi's Mukherjee said that the platform had worked out the right kind of business model right from the word go. "In the initial days, every platform was struggling with business model. However, we decided to go with SVOD model as we wanted to create a habit among users to pay for content. We were also the first ones to decide against having monthly pricing in India. We have only annual pricing because the recurring payment ecosystem in the country is not evolved. We kept the subscription price affordable keeping in mind the capacity of the users to pay and our ability to invest in content," he elaborated.

The platform has grown its business in India and internationally on the back of SVOD model. "International markets contribute almost 40% of our direct subscription revenue. We have seen significant growth in Bangladesh. We are creating original content for the local market. We have our own office in that country," Mukherjee said.

Most of hoichoi's subscribers are based in cities, but the platform is trying to make in-roads into rural areas primarily through a lot of distribution tie-ups with cable and broadband players. "We have a 65:35 split as far as male and female audiences are concerned. The starting age of our target audience is 23-24 year olds."

Mukherjee said that the Bengali OTT platform has 85-86 originals with plans to increase that to 100 by year-end. "In 2022, we will launch 30 more originals. We offer two new originals and one new film every month. Our movie library comprises 600 titles and these are premium titles curated over the last 5-6 decades. We have classic, blockbuster and newly acquired films. That is pretty much 80-90% of quality Bengali movies. We plan to add 200 catalogue movies."

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