Who and where are the next 100 million OTT users?

As OTT penetration increases, who will comprise the next wave of viewers? It is this question that a panel at afaqs!' vdonxt asia 2020 pondered. The panel discussion was led by afaqs! co-founder Sreekant Khandekar and included Amit Kumar Yadav, director ad Solutions – PubMatic; Dolly Jha, head - Media, Nielsen South Asia; Gourav Rakshit, chief operating officer, Viacom18 Digital Ventures and Kranti Gada, chief operating officer, Shemaroo. We have included the complete video of the session at the end of this article.

Khandekar initiated the conversation with figures about the OTT and TV consumption patterns - 830 million Indians watch TV for an average of three hours and 44 minutes, against a consumption of 40-50 minutes per 350 million OTT consumers.

"Is OTT following the path of television or will it be different?" he asked. Nielsen's Dolly Jha picked up the question, stating, "All media is here to stay. Users in the US consumed seven hours of media a day 15 years ago and are consuming 10 hours today. Urban India today consumes around seven hours of content per day. Multimedia consumption is increasing."

Putting forth his views, Pubmatic's Amit Kumar Yadav said, "If linear TV needs to move towards digital, it is the growth of CTVs which we expect as the biggest shift in the next two to three years, primarily riding on the back of increasing broadband connections across smaller towns. And that is going to bring a drastic shift. The profile of the typical linear TV consumer (so far the females who have been watching TV by appointment) is going to change once we see a proper adoption of digital."

Viacom18's Gourav Rakshit added, "The rate of growth of internet is different from TV, it is all about access and penetration. We have accelerated our growth in the last few years based on cheap data and some of that might change, based on the hike in telco rates. But on the other hand, 5G will open a different paradigm of data consumption and that would take us further even faster."

Making her point, Shemaroo's Kranti Gada said, "While the growth path is very different, the content path will see digital content consumption habits replicate TV as the medium becomes as massy. The consumers that we have seen in the initial phase are the early adopters, the starved audience who were not being catered by TV." She also cited a Ficci report that says 70 per cent of content consumed on Hotstar is GEC content.

Raising a question at Gada's statement, Khandekar quizzed why OTT, which is consumed on an individual screen, would go the TV way. "In Indian households, people know what everyone else is watching. In the broader level, a difference of 10-15 per cent will persist in the way TV and OTT are consumed," she responded.

"Where will the consumers come from and what will they watch?" Khandekar probed further. Jha answered, "About a couple of years ago, about 20-22 per cent of the total franchise were women and today it stands at around 35 per cent. More women will come into the fold."

She added that more of rural India will come on to the platform and this will depend on factors like the kind of viewers, willingness to pay, etc.

Rakshit maintained that the people who make movies a success at the box office and watch Bigg Boss are the ones who will make up the next 100 million and are the ones who are paying for the content. He said that there is a certain amount of elitism when it comes to discussing consumers and content consumption. "They are an extremely vibrant part of our economy. As OTT tends to go more mainstream, we will have to dispel some of these myths," he added.

According to Yadav, "The consumption duration won't increase as fast as OTT is also going to face a lot of competition from various other mediums like gaming apps."

Continuing in the same vein, Gada said that apart from just playing, there is a large consumer base that only watches others playing and that poses as a significant opportunity for OTT players. Gada revealed that Shemaroo's retro music channel on YouTube is among the top global channels and has seen a significant boost from the 'Jio phenomenon'. "The other categories that are doing really well, both in paid and free, are regional content. Devotion is another category that is doing really well. We peak at around 60,000 to 70,000 concurrent users on our devotional content," she elaborated.

Taking the the discussion further, Khandekar queried about the probable impact of the recent hike in tariffs on OTT consumption. Viacom18's Rakshit responded, "The reality is that the genie is out of the bottle and you can't put it back in. Consumers will try and find ways to consume content of their choice."

"But how does one track users across multiple platforms and screens?" Khandekar asked. PubMatic's Yadav responded, "From the ad fraternity perspective, we still need to figure out the standardisation of KPIs. As a tech platform, we work towards enabling publishers to be able to attribute users across platforms through deterministic (like login data) and probabilistic (not logged in but still consuming) user data. While it does not reveal specifics, the behaviour of the use can be identified across the ecosystem."

How would consumption grow in the coming years? "The average mark of 60 minutes should be easy to breach and won't even take three years. We would only see it increasing," said Nielsen's Jha.

On the matter of 'pay vs free', Rakshit said, "The next wave is looking for content that is beyond what they get on TV but something that they are familiar with. The current content stable seems to talk to the ones who have strong Western influences. It is not something that is relevant to the masses. It is about the paid market and the subscription businesses. It is different for free content. "

Gada maintained that India is a value conscious market and there is a lot of of content available at low prices, be it TV or other mediums. "The need to pay is not really as critical, unless there is something that is really compelling in the content proposition. The next 100 million are surely coming in the AVOD space," she explained.