Digital-only content consumers are estimated to reach 30 million in 2024 from 12 million in 2021, according to EY FICCI M&E report 2022.
Bundled digital consumer segment (people that consume pay TV and generally only bundled OTT content) will reach 400 million by 2024, the report stated.
The growth in number of bundled digital consumers is likely to happen on back of telcos bundling content to justify increasing data rates. The bundled digital consumer segment stood at 309 million in 2021 and 284 million in 2020.
Premium consumers comprising digital-only and tactical digital content consumers will reach 120 million by 2024. Digital-only consumers consume content only on digital platforms and don’t have access to television. Tactical digital content consumers are the ones who consume pay TV and at least one paid OTT service.
The free consumer base will also grow as progress continues to spread amongst the over 50 million homes today which do not have access to television. Free content consumer base is expected to reach 250 million in 2024. In 2021, this base was of 215 million people. In 2020, it stood at 200 million people.
Further, mass consumers base (consume pay TV and occasionally may consume some OTT content, usually free) is estimated to reduce to 63 million in 2024 from 228 million in 2021.
Connected TV sets will exceed 40 million
The report stated that smart connected TVs will exceed 40 million by 2025, thereby ending the monopoly of broadcasters on the large screen and leading to around 30% of content consumed on large screens to be social, gaming, digital, etc. The unified interface – whether on app, device, or platform – will become the new landing page and earn placement and marketing revenues.
The 2 x 4 LCO model is inevitable
The LCO will evolve to provide two wires into each home – a linear TV connection for live television and a broadband connection. LCO services will include aggregation of content (across TV and OTT), data, smart home capabilities and community social interaction and news.
Regional content consumption will increase
The share of regional content will increase to 60% of television consumption in 2025 from around 55% in 2020 and will increase to around 50% of OTT consumption from 30% in 2020. Advertising rates of regional media will increase to get indexed to the growing per-capita income of regional markets.
Talent shortages will drive up production costs
As original OTT content grows from 2,500 hours in 2021 to over 4,000 hours in 2024 at a much higher production cost than television content, television producers could face a shortage of quality talent. As the talent shortage becomes acute, it will drive up television production costs, which would need to be recouped through increased subscription revenues.
New content windows will emerge
Monetisation will be at the mercy of consumers’ willingness to pay, and unlike international markets, Indian markets are more heterogeneous and need to be finely segmented. Accordingly, premium SVOD, theatrical, SVOD, bundled SVOD, satellite, TVOD and finally free television windows could come into existence for different types of content.