Is the 800 pound gorilla about to come striding onto the already crowded battlefield? Will Walmart consolidate its purchase of Flipkart and then get into online video streaming in India to take on its arch-rival, Amazon Prime? Can Walmart make its presence felt in a viciously competitive field that includes cash-rich and content heavy competitors like Hotstar, the leader in the Indian market from the Star stable, SonyLIV, Voot, Eros and the global giant Netflix that’s pouring in money to develop great movies and shows for the local market. There are also players like Georgia- and Hyderabad-based YuppTV

A not-so-silent revolution is changing Indian viewing habits. In ever bigger numbers, Indians are logging onto to OTT (over-the-top) video services that come to them directly on the Internet. These video services bring together an attractive package of top-notch foreign shows combined with movies and programmes in local languages, global sporting events and even e-commerce deals. In the last year that has combined with crashing data prices to send numbers soaring. Says Ajit Mohan, CEO, Hotstar: “2017 has marked an inflection point of sorts where mobile data penetration’s finally catching up to smartphone penetration in the country.”

Look at Hotstar, the segment’s market leader which is fresh from its IPL mega-hit when it got a mammoth 202 million views. Hotstar had a total of 50 million viewers who tuned in during the final and it pulled off a technological coup when over 10 million viewers simultaneously logged in.

Soon afterwards SonyLIV also scored big with 70 million views during the FIFA World Cup. Sony reckons key factors, including its six language feeds and the perfect timing of the matches, came together to bring in the big numbers. Sony’s hybrid offering allowed viewers who didn’t want to pay to watch matches with a five-minute delay.

“The World Cup clocked in 70 million viewers from digital alone which is a great feat. The fact that people could watch these matches even on the go contributed to the growing numbers,” says Uday Sodhi, Business Head, Digital, Sony Pictures Networks, India. Most promisingly for SonyLIV it was able to get one million paid users for its premium feed.

Intense battle

So intense is the battle for online eyeballs that Netflix, the global giant renowned for its gargantuan spending on programming, is feeling the heat intensely and looking at experimenting with different business models. It’s already tied up with film-makers like Anurag Kashyap and Shah Rukh Khan’s Red Chillies and its mega-hit TV serial Sacred Games has gone global. But that hasn’t saved it from coming in closer to the bottom of the pack.

Netflix CEO Reed Hastings admitted recently that Netflix’s higher prices were a deterrent and that it needed to tweak its business model for India. The Netflix app now comes pre-loaded on Airtel’s hybrid set-top box, which offers a mix of online services and TV channels.

Hastings knows the Indian market’s growing exponentially and it’s crucial to make a mark here. Consultancy firm PwC reckons India’s OTT market’s worth slightly over ₹2,000 crore currently and should cross ₹5,000 crore by 2022. What's more, in December 2017 there were around 270 million mobile broadband subscribers. In five years that’s expected to touch around 500 million.

Hotstar was first off the mark and it now has around 150 million active users monthly and 350 million downloads since its launch in 2015. The company took big bets early on and now has programmes in 18 languages which is key to its success. The IPL brought in many new subscribers for the channel but Mohan stresses sports is only one part of its offering. He says: “Eighty per cent of our watch time comes from TV show and movies.”

Similarly, SonyLiv’s focussing on regional languages and has over 400 shows in languages like Hindi, Marathi, Gujarati and Bengali. It also has a well-stocked library of Tamil, Telugu, Malayalam, and Hindi movies. Says Sodhi: “We aim to cater to the growing demand for local content with our differentiated content library.”

With Walmart on its way, Amazon’s making a redoubled effort to capture a greater chunk of the market. It recently held an Amazon Prime Day, a shopping jamboree with over 200 new products on offer and led up to this with a string of new programmes and blockbuster movies like Dunkirk , Transformers and Raazi . “More new members joined the programme in the one week leading up to Prime Day than in any week since we launched in India,” says Vijay Subramaniam, Director and Head, Content, Amazon Prime Video, India.

Amazon’s e-commerce edge has forced others to play the same game. Hotstar’s recently tied up with Flipkart.

Says Mohan: “It’s perhaps a global first that a leading streaming platform and a leading e-commerce company have come together to create a unified offering for marketers.” Similarly, Sony’s scouting around. Says Sodhi: “We’re exploring and waiting for the right partnership.”

Also moving smartly are other channels like Viacom’s Voot that’s reckoned to be number two in the OTT market with over 20 million viewers, with programming in Tamil, Bengali and other languages. It also has offerings from Colors, Nickelodeon and local programmes like Bigg Boss and Roadies. Similarly, Zee TV’s Zee5 has also moved quickly into regional languages and will soon launch Tamil serial Kallachiripu.

One challenger that’s hoping to appeal to a mass Hindi-speaking audience is ALT Balaji, the 15-month-old digital wing of Balaji Motion Pictures, which already has 100 hours of original programming and a huge bank of old TV serials. It will spend heavily on new programming in the near future.

Jio Effect

The fact is the boom in online video-on-demand has largely been driven by the what could be called the Jio Effect. Slashed data prices resulted in the number of Internet users shooting up to 481 million in 2017. And the online video audience zoomed by 64 per cent. Says Mohan: “Over 95 per cent of our service is consumed on the mobile.”

But it’s just about slashed digital prices. Crucially, the channels are spending big on programmes and that’s having an impact. Amazon Prime’s Inside Edge starring Vivek Oberoi and Richa Chada got high ratings on IMDB and also attracted viewers as did Breathe starring R Madhavan. And Netflix's Sacred Games has received rave reviews.

“The OTT platforms started offering content with tight storylines and that’s when people started to consume a lot of content,” says Darshan Bhatt, Director, GoQuest Digital Studios, which launched in April to provide premium content.

India will soon be one of the world’s top markets for OTT services. It’s a huge glittering prize for both the foreign giants and the home-made players and they’re getting ready for a furious battle to win the biggest share.

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