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SVOD can reach 100 mn Indian households, Rs 110 bn revenue by 2025

EY estimates for 2023 are flat as they factor in the expected free streaming of the IPL on JioCinema, which could impact paid subscriptions

A consumer subscribing to three large OTT video subscriptions today will spend around Rs 3,000 per year, which is a significant amount and could well limit the growth of OTT subscribing households to 52 million by 2025, accounting for 114 million subscriptions.

According to EY’s latest report on the media and entertainment sector, in the event large platforms launch more affordable packages (at around Rs 1 per day, for example) or aggregators bring the bundled price down to Rs 1,500 or so per year, EY estimates that the number of households paying for one or more SVOD service can reach 100 million, and total digital video subscription can increase to around Rs 110 billion by 2025.

In 2022, 99 million paid video subscriptions across almost 45 million Indian households generated Rs 68 billion, an amount which is over 60% of broadcasters’ share of TV subscription revenues.

EY estimates for 2023 are flat as they factor in the expected free streaming of the IPL on JioCinema, which could impact paid subscriptions. SVOD platforms will need to increase their content investments to grow and retain paying subscribers, and EY expects to see leaders and challengers increasing content budgets.

45 million Indian households paid for 99 million OTT video subscriptions in 2022. Actual OTT video users/audience could be estimated at 135 to 180 million individuals as subscriptions were shared amongst family and friends.

The report further said that the top six metros contributed 33% to total paid subscriptions in India.

Over 3,000 hours of original content were created for OTT platforms – including over 75 (mostly small budget) direct-to-digital films - which were extensively marketed and led to increased demand for OTT subscriptions.

Other key drivers for growth included live sports, bundling, exclusive reality content and pricing changes.

SVOD benefited from digital payment changes

As UPI payments continued to gain scale in 2022, M&E benefited from the same; some platforms claimed to receive 75% of their payments via this digital channel.

Permitting the auto-renewal of subscriptions up to Rs 2,000 is also expected to help manage churn, though tokenisation of credit cards did have a negative impact.

Regional content investments increased, as did consumption

As per the EY report, half the original content produced was in Hindi, down from 70% of the content in 2022, showing a clear shift towards regional language audiences; platforms claimed their content was viewed across 99% of Indian pin codes.

Films released directly on OTT were watched across over 4,000 towns and cities in India, which compare favourably against the erstwhile “mega movie releases” which peaked at 3,000 cinema screens.

Most large platforms adopted a strategy of eight languages (Hindi, four southern languages, Bengali, Marathi, English) or more.

Dubbing and subtitling of movies and original content across Indian languages became the norm for most marquee releases.

OTT content will break language barriers

Demand for original content will increase from 3,000 hours in 2021 to over 4,000 hours by 2025.

The share of vernacular content will increase to over 62% of total content produced as regional OTTs flourish and achieve scale on the back of dubbing and subtitling. This could also lead to increased costs for regional content production.

As production costs keep increasing, EY expects to see the mix of high: medium: low budget content getting skewed towards medium and low-cost production, as well as more IP co-ownership and sharing deals.


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