If digital content has emerged as a formidable player with overwhelming response. Cheap internet connections, low subscription rate and easy access to digital devices has further helped to increase penetration.
Current pandemic situation has only boosted the acceptance further as OTTs witnessed surge in reach and consumption. In absence of cinema halls, OTTs have been able to successfully fill up the vacant spot.
The Indian OTT Industry
As the situation stands currently, the OTTs are proving to be the exact alternative for mainstream film-makers since the closure of cinema halls. On one side, there are clear frontrunners who have the money to create quality content and market their platform to the right audience.
Besides the ready content, several big-ticket films are seeking release on platforms like Amazon Prime. Others, like Netflix, have been breathing new life into old films by bringing them online.
Netflix, for instance, has a well-stocked library. “We work far out relative to the industry because we launch our shows all episodes at once…So our 2020 slate of series and films are largely shot and are in post-production remotely in locations all over the world,” chief content officer Theodore A Sarandos said during the company’s Q1 earnings call on 21st April 2020.
Then there is a whole segment of platforms run exclusively by TV channels and movie studios looking to leverage their vast library. They are targeting regional audiences by providing content in regional flavor. Cheap data and prices and comfort of consuming content as per the personal convenience is providing these platforms enough opportunities to grow.
The surge in subscriber base
The lockdown added a further lever to the OTT consumption, resulting in higher subscriptions. Amazon Prime and Netflix witnessed 67% and 65% surge in subscriptions, respectively, during the lockdown period. Zee Network’s ZEE5 registered an 80% rise in subscriptions during the same time, while ALTBalaji witnessed a 60% uptick in its user base.
“Normally consumers complete a series in five to seven sittings, they’re now consuming in two sessions because the time for entertainment has increased,” Ferzad Palia, head of the production firm Viacom18’s video streaming platform, Voot Select, said.
Challenging times ahead for multiplexes
With no sign of theatres opening anytime soon, FY21 will be a tough year for multiplex operators like PVR and INOX. Cinemas and hospitality are expected to be the last ones to recover.
In addition, whenever cinemas open, social distancing norms will restrict the multiplexes from operating at full capacity. The multiplexes are expected to lose 20-25% peak annual occupancy due to the social distancing norms, even after they are allowed to resume their operations.
Teji or Mandi?
With people being homebound, consumption of digital entertainment has seen tremendous growth. TV, online gaming, music streaming, podcasts, and video streaming platforms are becoming the top choices for at-home consumers to kill their time.
Thus our take is Teji for OTT platforms as local as well as international companies trying to come up with innovative ways to attract new users. They are creating an immersive experience with the integration of AR/VR technology; new business models; new content strategy, diverting the audiences towards OTT platforms.
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