The president and COO of Vuclip which has streaming platform Viu takes a subtle dig at Hotstar, during a chat about his content and marketing strategies.
Viu, a video-on-demand (VoD) service provider by PCCW Media Company and Vuclip has a presence in more than 22 countries that include those in South Asian markets, the Middle East and India. The platform recently launched its originals in the Tamil Nadu market with content that includes Tamil language originals, Tamil short films, Korean dramas, and curated content for the enjoyment of millennials in Tamil Nadu. In India, the platform has already launched 20 originals and will be launching 20 more by the end of the year. Viu plans to launch around 95 originals across markets in the next one year.
We interviewed Arun Prakash, president and chief operating officer, Vuclip, to understand the way forward for the platform in India, the focus on regional content, challenges etc.
Just this year, we will have already been done with programming 95 originals across all our markets. It is a path we started on 18 months ago, a path we're scaling because of all the learnings/data we have gathered after making originals in these markets. In every target market, originals will be an important element. Our entire content strategy is local, regional content, not international content. It is not Hollywood content.
Our entire strategy is based on local content, leadership teams, experience and pricing. We will not spend all our time making and marketing just one piece of content... then the consumer will watch it and uninstall the app. Our ambition is to create a habit.
We look at quite a few parameters. One of the parameters is internet adoption and so on and so forth. The second is the maturity of the consumer audience and their taste and preference of what they are looking for. If the consumer is already satisfied with what's happening on television, then why do you have to do something different and new? But all our data from TN tells us the opposite. The youngsters may be doing a lot more of passive viewing of TV, like background noise running in the house. So, there is a tremendous opportunity to provide content for the youth and that content doesn't exist. It doesn't exist in the form of any digital platform or any mainstream TV platform; so there is a vacuum and a hunger.
For example, if most households are being dominated by Sun TV, the youth don't get the kind of content they deserve. So, the entire equation is created on the basis of that which doesn't satisfy a lot of young audiences who are left behind in terms of serving their common needs. This then creates a massive opportunity for platforms like us.
We tie up with anybody who has a great story to tell and if we are ready to invest and produce the content; if it's BBC, then so be it. When we decide to make content, we let the content decide the format. We don't get into the content deciding it will be a mini-series or a movie. A lot of people make the mistake of the format dictating content. For us, it is the content that dictates the format rather than the other way around.
In Telugu, we have tied up with Annapurna Studios. In Tamil Nadu, we are talking to new content creators who have done content for youth.
This is exactly as planned. We would not like to change this. There are a couple of things - one, for India as a market, consumer adoption of OTT is still in its very early stages. The hype-cycles are way too much and the investment levels are also too high, which reminds me of dotcoms. This is a bubble which is waiting to implode and burst. A lot of people are creating a lot of hype when the consumer is just getting started on the journey. I think we are here to develop that consumer journey and we will develop along with them.
The second point is - in developing the consumer journey, we focus first on substance. We see value in the consumer; create value for them before you can ask them for value or for them to pay. You first have to show your value to customers. Why should they even download an app on an on-going basis? Why shouldn't they un-install it? 'IPL is over, let me un-install...' should not be the case. So that journey has to be fully developed where you earn a place as a habit in the consumer's mind and heart. Once you are there... then you amplify.
I am a very firm believer of not getting caught in market hype. One should be true to the consumer in creating value, hence - substance first, style next and then amplification; it definitely goes without saying that one needs to do this. But the question is - in what sequence? Many companies make empty noise which means they put style first before they even create the substance. Some companies do both together - I will create substance and in parallel, make a lot of noise. But a company like Vuclip believes that substance should come first in the sequence with amplification later on.
This is exactly as designed and it doesn't matter what other players in the space are doing. This works for us and it has worked well in other markets and emerged very strongly as either No 1 or No 2 in South East Asian markets. If one goes to the Google Play Store and searches for Viu, in markets like Thailand, Singapore, Malaysia, Indonesia, and Hong Kong, we are either the No 1 or No 2 app. There's no reason for us to believe why it won't work in India.
We made our launch announcements through above the line (ATL). Our general philosophy is that we drive a lot of organic growth. So a lot of word of mouth. To me, that is a good way to let your content do the talking, but that alone won't be enough. We do focus more on BTL and digital and only after we establish a steady stream of an on-going habit, then we would do an immense amount of ATL.
You wouldn't see us just like you see any of the other guys doing aggressive ATL till we believe we have a sequence and we have achieved what we wanted to achieve. We won't rule out promoting our new content through the Tamil Nadu Premier League (TNPL). There is a lot of potential in the TN market on what we can do in terms of associations and creating content and there are a lot of interesting dialogues happening right now. We just have to be focused because it is very easy to want to take part in everything... but we have to be focused.
We are and have been doing content for HSM and we will continue. I think we make very unique content for these markets, not do the same that you see on TV. We will continue to make content for HSM while we focus on local, regional content because our approach is local and regional and we will continue to double and triple down on this content which will span all across the country. It will be in a priority sequence of how we want to go with the rollout.
To not get caught in the hype-cycle. There is a massive amount of hype, much more than or several times more than any other country we are seeing. So, our first challenge is to make sure we do not get caught in this noise and stay true and focused on what we are here to create. The second is that the industry has too many players. It creates a difficulty for them when it comes to making content. They are making super-expensive content and I think that's a challenge.
My belief is that in the next 3-5 years, this industry is in for a massive consolidation. The reason I say this is because OTT is not a one, two or even a five-year game. It is a 10 year plus game and it is not a near-term profitable game. You cannot become profitable overnight in this business and overnight here is not even 3-5 years. Third, it is not an inexpensive game. You need a massive amount of investment each year to succeed.
So, the 10 years' time horizon - several 100 millions of dollars in investment, sustain and scale that for every year for that period of time before you can think of profitability - I don't think 35 players can do that. It will come down to hard economics. Not many people can sustain.
I actually believe there will be only a handful of players and we all know who that handful will be and those who are going to be left behind. It is going to be the ones with deep commitment and pockets and those who have the expertise to play the game and I believe Viu is one of those in the handful and that comes from buying strength from PCCW and Vuclip.