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Ficci Frames 2016: Will OTT consumers be willing to pay?

Ficci Frames 2016: Nickhil Jakatdar, CEO, Vuclip, Manish Agarwal, CEO, Nazara Technologies, Eklavya Bhattacharya, Chief Strategy Officer, Alt Entertainment, Karan Bedi, CCO, Eros Digital and Rajiv Vaidya, CEO, Spuul, India debate…

BestMediaInfo Bureau | Mumbai | April 4, 2016


All business models do not work everywhere. In India, most content offered by Over-The-Top (OTT) players across the internet are either free or “freemium”, implying that a portion of the content requires subscription. As OTT players mulled on monetizing their platforms at a   Ficci Frames 2016 session on Friday, a consensus seemed to emerge on the business model of the future.

Most OTT players represented on the panel concurred that Indian consumers would be willing to pay for content in the long run, even though, the other models would survive too. Most OTT players operate on the advertisement driven model, which is a challenging business model. The other challenge they face is bandwidth. At the moment 4G is at a nascent stage in India and often, not enough bandwidth is available for video streaming services. In an economy of a billion, the 3G user base is a mere 80 million.

In a discussion moderated by Ros Atkins, Presenter, BBC World News Television, a debate ensued on the challenges before the OTT players and the evolution of the digital subscription model. On the panel were like Nickhil Jakatdar, CEO, Vuclip, Manish Agarwal, CEO, Nazara Technologies, Eklavya Bhattacharya, Chief Strategy Officer, Alt Entertainment, Karan Bedi, CCO, Eros Digital and Rajiv Vaidya, CEO, Spuul, India.

A gist of what they said:

Eklavya Bhattacharya, Chief Strategy Officer, Alt Entertainment:

“I believe that the Indian consumer will pay for content. While it is at a nascent stage, eventually the consumer wants good content as he will pay for it. People don’t like to watch free content, they like to pay for it. At the end convenience will drive the evolution of the platform. Since, mobile is convenient today, a lot of content is viewed there and that is the big changer for the industry. We will also see transaction video in the future, where a consumer pays per video instead of subscribing to a large library.”

Rajiv Vaidya, CEO, Spuul, India:

“We at Spuul follow the freemium model which is a mix of free and subscription based content. While the free content will not be premium, the premium content will be available only on subscription. We as a platform want to control advertisements to give consumers a better experience. While the model is still evolving, content is something that is available all over the globe with maximum users in India.”

Karan Bedi, CCO, Eros Digital:

“Our model is like Spuul, a freemium model, but the maximum is available at subscription. While piracy remains a global issue, the subscription based model will also exist as people will pay for content that is exclusive. With the yearly deals with studios getting shorter, content owners are seeing more value for their content.”

While exclusivity remains a challenge, OTT players have overcome the platform neutrality challenge, making it available across all screens.

Nickhil Jakatdar, CEO, Vuclip:

“With our freemium model, we are flexible in the 12 markets that we are present in. In emerging markets, if you don’t give consumers free, they will never come to you. Apart from that, what you offer in the subscription market is different from country to country. Another aspect is on the payments front. Micropayments is a good idea for mass markets. As a player, it is important for us to look at all types of consumers and not only the premium ones. Hence, micropayment is something that will succeed in the Indian context.”

Manish Agarwal, CEO, Nazara Technologies:

“We have a paid and a freemium model. What we do as a gaming provider is start with the consumer’s proposition. India is not a gaming nation. Premium and non-premium content is available with us, but each at its own price. In the Indian market, we have seen increasing in-app purchases and the consumer is likely to retain the game when he buys that.”

In conclusion, it seems that in spite of the challenges that OTT players are facing, the Indian market is at a very nascent stage when it comes to consumption patterns on the OTT space. There is catch up content, there is fresh content, less appointment viewing and more of on-the-go viewing and that is something that will evolve in time to come. Not to forget that bandwidths will only get better when data costs reduce.

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