Benita Chacko

OTT consumption, connected TV sales set to rise with 5G launch

Jio and Airtel are expected to launch the high-speed internet technology in October.

At Reliance Industries 45th Annual General Meeting last week, its chairman and managing director, Mukesh Ambani, announced that Jio will launch 5G services by Diwali this year. The services will be first rolled out in metro cities of Delhi, Mumbai, Kolkata, and Chennai. It will be expanded to other cities and towns in phases and the entire country will be covered in 18 months by December 2023.

Bharti Airtel’s chairman Sunil Mittal also said last week that the telecom operator will be launching 5G in October. Meanwhile, IT Minister Ashwini Vaishnav has said that 5G services will be launched in major circles on October 12.

5G refers to the fifth generation of high-speed mobile internet which offers super-fast download speeds and more bandwidth that’s capable of supporting technologies like driverless cars, virtual reality applications and the metaverse.

The entertainment industry will also receive a boost, especially the OTT services as the technology is set to offer enhanced viewing experience. HD and 4K videos will have much better streaming quality. As a result, the consumption of content on OTT platforms may also see a rise.

Sunil Nair
Sunil Nair

Sunil Nair, managing director- APAC region, Firework, says, “OTT has suffered from lack of bandwidth in many of the buying parts of India. With the promised low latency and enhanced download speeds the OTT consumer will be able to consume content without pixellation and buffering.”

Jehil Thakkar
Jehil Thakkar

With 5G technology coming in, OTT platforms may also upgrade its content. Jehil Thakkar, partner, Deloitte India, says, “We have 4K televisions in the market, but there is no content available for it. It wasn't being made because the networks were slow and there wasn't a wide market. Now we can expect an upgrade in the type of content.”

Uday Sodhi
Uday Sodhi

Experts believe that 5G’s launch may give an impetus to the growth of connected televisions (CTV) in India. Uday Sodhi, senior partner, Kurate Digital Consulting, says the number of CTVs in the country is going to witness a significant jump from the current 20-25 million.

“These devices require significant bandwidth that only a fiber or broadband connection or now a 5G connection can give,” he explains.

Thakkar adds, “But the impact will come as device adoption grows. Though a lot of devices are marketed as 5G equipped, not many can take advantage of 5G today. In the first year it will be more of a marketing story and then there will be true adoption.”

5G will also have a marked impact on other entertainment options like gaming, social media, short video content and user-generated content. “There will be a greater adoption of competing entertainment options like gaming. Today the experience on phones and tablets is not great. With 5G there will be a significant upgrade in gaming and that will also compete for attention span. And as these consumers grow older they will carry forward this habit,” says Thakkar.

Nair says AR and VR technologies will also receive a boost and metaverse will become mainstream. Moreover, content creation will finally be able to move to the cloud. “With better connectivity and enhanced services asset-light broadcasters will benefit,” he says.

However, these changes are not immediate. While 5G will be launched next month, it is expected to reach all parts of the country only by December 2023. Meanwhile, consumers also have to upgrade to 5G equipped devices.

Thakkar says there will be a tiered impact. “In the initial days there will be adoption from the 10-12 million early adopters.These are people who have phones with 5G technology. A lot of phones will go through a cycle where they will be upgraded and that's when there will be a wider impact,” he says.

However Sodhi doesn’t see that as a challenge as he says that many have purchased 5G phones in the last two years. Moreover, these phones are available in all price ranges making them more accessible. And these days people tend to upgrade to new phones in around two to three years. “Over a period of 6-12 months this will be the default bandwidth available for phones,” he says.

Another concern is if the pricing may curb consumption as the telecom operators are expected to increase their rates.

“The investments for 5G and the infrastructure costs in future will mean that unless telcos increase the revenue per customer they will bleed to death. There may be a slow and steady increase in bills for the consumer,” says Nair.

Apart from data costs, OTT consumption also depends on the price of the devices. For wider adoption, both these costs will play a role. “A lot of consumers will make that value judgement of how much the experience improves for the additional price they pay,” Thakkar adds.

OTT platforms will also have to make decisions on the production aspects. “OTTs will have to take the call on shooting all the content in 4K. That will be a choice they will have to make in the next two to three years,” he says.

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