Decoding the amazing comeback story of Sony LIV

Growing from 0.7 million paying subscribers in 2020, Sony LIV today has 24.4 million paying subscribers.

This was a streaming platform everybody had written off. It was struggling for years. Until it was relaunched in June 2020. It finally found its stride and entered the league of the successful.

A large part of the growth is due to its premium content slate. It brought in original content like 'Scam 1992', 'Rocket Boys' and 'Maharani', among others. It also became the preferred destination for sports enthusiasts, hosting several tournaments.

In an interview with Vanita Kohli-Khandekar, contributing editor, Business Standard, at the recently held vdonxt asia conference, organised by afaqs!, Danish Khan, EVP and business head - SET, Sony LIV and StudioNext, passionately explains how it managed to reverse its fortunes.

Edited Excerpts:

We'd like to hear your side of the story about how things changed for the platform.

We relaunched in June 2020. I took on this role in December 2019 and we had a couple of planning sessions and reviews by March, when the lockdowns were announced. We would have regular 'pitstops' over video calls. It began as 15-20 minute calls but over the months we started talking for five-six hours.

We recruited many people before launching Sony LIV 2.0. The teams were very small, especially the product and tech teams. By the time it was launched and a couple of new shows were released, everybody thought that this can be extraordinary and started putting in a little extra effort.

Though Undekhi and Your Honor were critically acclaimed, they did not attract big numbers. The big turn around came with Scam 1992?

Undekhi was received in a smaller circle. JL50 was consumed strongly and it's one of the rare science fictions that we have produced. It got an audience which was very different from what Sony LIV would generally attract. However, Scam was where perceptions changed.

There was a lot of nervous energy around the show because it was a business show. It had a lot of terminology which we thought people would not understand and appreciate.

We thought Scam would be a good success if we manage to convert 10% of the pink newspaper readers in India. We've got a little more than that. It went beyond the readers of the pink papers.

When you say a show is a success do your base your assessment on subscriptions or viewership?

You can drive subscriptions to a show through good promos. But ultimately, as a storyteller and as a platform, we would like to see some great viewer engagement to know that we are on the right path. We focus on both, but more on viewership. Moreover, we don't want post purchase dissonance, where the renewal rate is not very high. Our renewal rate is about 90%, one of the highest in the industry. The completion rate is also high. On an average it is in the range of late 70%.

Business stories are very difficult to turn into fiction scripts and relatable video. Was it tough? Also Hansal Mehta had not had any commercial success yet. So why did you choose him?

We were very clear about three things. One, we'll be a profitable business. So we'll work within a budget and a business plan that leads to profitability. We were not looking at throwing money at the successful film directors. Instead we were looking at working with capable people on some interesting subjects. Our hero was not going to be the maker or the actor but the subject. So our initial show choices were Scam, JL50 and Rocket Boys. These are cerebral concepts that not many people can write or appreciate. But in a population of 130 crore we initially wanted to get only one to two crore people to watch it. Gradually we would grow. We were clear that for our originals we will go with 'cerebral storytelling'.

You said something very interesting with the green-lighting process. It's very core to the way you run your business. Can you share that with the audience?

We define our content team as the first consumer. So our feedback would be in innocent consumer words, like, "I am unable to understand", "I didn't like it", "I'm not finding it funny".

We did two things. First, is speed. We hear the concept and intuitively say whether we like it or not. So far we have not used a lot of data and algorithms. We didn't want people to waste a lot of time with us. We quickly make decisions. The storyteller gets a strong response and that's what they like. Second, we should give them a feedback or a consumer's point of view which they don't get generally. We should not be competing with the writer or the director because we are not competent enough.

One of the biggest challenges was to put ourselves in the consumer's shoes and just react. We kept on pushing our content team to behave like consumers and we keep doing that even today.

A lot of the growth ascribed to SVoDs is through telecom companies, etc. How much of Sony LIV's subscribers are direct?

Out of the 24.4 million subscribers around 13 million comes from telcos and 11 million comes directly. Financially both are the same. Our ARPUs are around Rs 606 right now. Primarily if you look at any OTT platform, the future growth is going to be through bundling. Also we have just started distributing coupons in retail stores.

Half of Scam's or Rocket Boys viewership came from dubbed versions and other languages. You also forayed into Tamil and Telugu originals. Where are you on that? Can you provide a break up for languages?

We started opening our South Indian languages primary because of our sports offerings as well as some shows. For example, for Rocket Boys around 55% of the new subscriptions came from the South, both directly as well as through telcos. Similarly, after Rocket Boys people in the South started discovering other content. Around the time that we were launching Rocket Boys we got a lot of Malayalam and Tamil films. These were not really commercial superhit films, but curated films. These kinds of films started doing well.

Sony India itself is broadcasting a lot of big films. But as an OTT you have stayed away from big films. Is that a conscious decision from a cost perspective?

Yes. We wanted this new medium to have a profitable growth. Sony is more about profitable growth and not about putting in a lot of money, making tall claims and then waiting for it to become profitable in the future.

Tell us about the profitability.

We turned profitable with Sony LIV in the second year itself. The margins are pretty healthy. They are pretty similar to the margins that we presently have in TV, in the range of 20%.

Watch the full interview here: