Inking deals with rivals to penetrate into newer markets is the latest mantra for over-the-top (OTT) content players.

In the race to acquire more subscribers in a fiercely competitive industry, OTT players now prefer collaboration over competition. It makes sense: a larger audience base, lower costs, and varied content.

“The main aspect in these collaborations is access to good quality content. Most OTT companies today are content players as well as delivery engines. In that scenario, it is about widening reach as well as revenues. And that can happen faster through tie-ups than through competition,” Mritunjay Kapur, Head - Technology, Media and Telecom at KPMG India, told BusinessLine .

Content creation requires time, strategy, ideas, and investment. To cut the cycle short and access content more easily, OTT players are partnering each other. So AltBalaji has tied up with OTT platform YuppTV, while SonyLiv has joined hands with Arré to reach out to a larger audience base with differentiated content. Eros Now has partnered Sri Lanka’s Dialog Axiata and Chinese online video-streaming service iQiyi.

Revenue arrangement

OTT players draw up contracts with either a licence fee paid to the owner of the content for a certain duration, or the companies share revenue collected by the platform. Sometimes, there is a minimum fixed fee along with a revenue share.

“I believe collaboration is integral to fuel creativity. Given the dynamics of the Indian OTT market, all players are striving to get the best piece in the pie. To partner platforms and brands that share the common vision of effective storytelling will help create more choices for viewers,” said Abhishek Joshi – Head of Marketing, Subscription and Licensing, Digital Business at Sony Pictures Networks India.

SonyLiv tied up with Arre in October 2016, giving its users access to various web series and documentaries. “Collaborating with Arré has helped SonyLIV offer innovative content for our audiences. I believe such creative collaboration is going to lead the way in digital entertainment and uplift the ecosystem,” Joshi added.

Eros Now has been using collaboration as a tool for geographical expansion. In June, it tied up with Dialog Axiata, whose users can subscribe to Eros Now through the Dialog ViU app. They pay a monthly fee of ₹100 for the subscription. Its partnership with Baidu-owned Chinese streaming giant iQiyi is a content licencing deal, which will allow Eros to make inroads into that country’s digital space.

“The tie-up is a vital step as we continue to explore opportunities for expanding our content offering globally. China has emerged as an important market and a major box-office earner for Indian films in recent years and it is a very significant milestone to expand our content distribution network through alliance with iQiyi,” Rishika Lulla Singh, CEO, Eros Digital, said.

Kapur said that given the many OTT players in the market, many of them with regional focus, acquisitions could be in the offing. “Going forward, we will see consolidation along with collaboration. Ultimately, it is niche, original content that will drive the game,” he added.