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OTT Sector |

OTT Sector

Context

∙ India’s OTT market, sized at $2.5 billion, went through a major disruption in 2023.

About

∙ This disruption was due to Jio Cinema offering the most premium content-IPL, free to users.

∙ This negatively impacted subscription revenue growth for peers and the industry at large and led to Disney Plus offering cricket World Cup free for mobile customers.

What are OTT Services?

∙ OTT (Over-the-Top) refers to content providers that deliver media directly over the internet to users without the need for traditional cable or satellite TV services.

∙ Essentially, OTT platforms utilize streaming technology (transmit data [audio, video, etc.] in real time over the internet) to deliver their content to users.

Indian OTT Sector

∙ Market Size and Growth: The OTT market  in  India is currently at 10,500 crore, including subscription revenues. This is expected to touch 12,000 crore  by FY 2024 and 30,000 crore in FY 2030 with a 20 per cent growth on year-on-year basis, according to CII.

∙ There are currently over 45 million OTT subscribers in India.

Key Players:

∙ Global giants: Netflix, Amazon Prime Video, Disney+ Hotstar.

Benefits

∙ Domestic players: ZEE5, SonyLIV, Voot, MX Player, ALTBalaji.

∙ Regional players: Aha (Telugu), Hoichoi (Bengali), Voot Select (Tamil).

ο Media Ethics Code) Rules 2021 to establish regulations for Over-the-Top (OTT) platforms.

∙ Recently, the Union government has introduced a new bill that will consolidate the regulatory framework for various broadcasting

∙ Original content: Rising focus on creating original Indian shows and movies, catering to diverse regional and linguistic preferences.

∙ Genre diversification: Expansion beyond traditional genres like drama and comedy, with thrillers, documentaries, and reality shows gaining popularity.

∙ Language focus: Increased focus on regional languages, with platforms launching original content in Tamil, Telugu, Malayalam, and other regional languages.

∙ Short-form content: Growing popularity of bite-sized content like web series and short videos.

Challenges

∙ Competition: Intense competition among both global and domestic players requires robust content strategies and competitive pricing.

∙ Data costs and affordability: High data costs remain a barrier for some users, particularly in rural areas.

∙ Piracy and copyright infringement: Protecting content from piracy remains a challenge.

∙ Regulation and censorship: Balancing creative freedom with government regulations and cultural sensitivities requires careful navigation.

Laws Regulating OTT Platforms

∙ In 2022, the Central Government issued the Information Technology (Intermediary Guidelines and Digital services, including over-the-top (OTT) content.

∙ The bill, once passed, will set up content evaluation committees for regulation and watchdog.

Opportunities

∙ Rural market expansion: Strategies to address data affordability and cater to regional content preferences can unlock rural market potential.

∙ Technological advancements: Integration of Augmented/Virtual Reality and personalized recommendations can enhance viewer experience.

∙ Consolidation and partnerships: Potential for mergers and acquisitions or strategic partnerships to optimize resources and compete effectively.

∙ Global content export: Indian OTT platforms have the potential to export original content to international markets.

Way Ahead

∙ The Indian OTT sector is poised for continued growth, driven by rising disposable incomes, increasing internet penetration, and a growing appetite for diverse and engaging content.

∙ Overcoming challenges like affordability and piracy while capitalizing on opportunities in rural markets and technological advancements will be crucial for sustained success.

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