With India’s digital infrastructure evolving rapidly in 2016 thanks to greater 3G /4G adoption, the year has paved the way for the steady growth of over-the-top (OTT) video services in the country. Better connection speeds and newer technological innovations have facilitated an exponential increase in digital video content consumption amongst Indian viewers. As several precipitating factors converge and smartphones become the default first screens for new-age users, the Indian entertainment industry is witnessing a paradigm shift from traditional viewing formats towards OTT services, largely because of the convenience and the diversity offered by the latter.
Early 2016 was the harbinger of digital prominence in the Indian entertainment sector. Receiving a strong push from the growth in the non-linear digital ecosystem, India became the second largest smartphone market in the world in terms of active unique smartphone users. High-speed connectivity also increased rapidly within the country, making multiscreen video consumption extremely lucrative for the Indian viewership. This, in conjunction with anytime, anywhere accessibility enabled by OTT content platforms, fits in well with the on-the-go lifestyles of viewers, especially those aged between 15 years and 35 years.
Online OTT video consumption in India witnessed a YoY (2016 vs 2015 ) growth of 66 per cent. Nearly 50 per cent of the overall video traffic in the country came from smartphones and tablets, with late night video consumption making for 40 per cent of the total viewing. Mobile services were the preferred entertainment medium for 28 per cent Indians, who favored them over traditional formats such as television.
Subscription-driven video-on-demand (SVOD) services, in particular, were major winners in 2016. Their ad-free operations were well received by Indian viewers, especially because they offered the end-user much better customisability. SVOD services allowed users to choose their preferred content from a rich and diverse library filled with movies, music, videos, sketches, original web series, and featured content. This allowed content developers and production houses to benefit from better monetisation services offered by such platforms and attracted more high-quality, well-curated, user-centric media such as HD and Ultra HD content.
With SVOD platforms also focussing on exclusive sports broadcasting rights to popular sports events, these platforms effectively engaged and tapped sports enthusiasts with TV-everywhere content. Viewers preferred the diversity and consistent quality offered by SVOD service providers over the user-generated content of the advertisement-driven video on-demand (AVOD) services. SVOD platforms, as a result, received much greater market traction in 2016.
The way forward: How 2017 will shape up for OTT content services
According to Frost & Sullivan, there have been 66 million unique OTT viewers in India. Out of this, about 1.3 million were subscribers who had paid for the content that they consumed. This number is only set to increase with the proliferation of the high-speed internet and the growing spending power of the average Indian user. As a result, the country’s OTT market has become extremely lucrative, leading to the entry of multiple global subscription-based players. Enabled by the disruption that the Indian OTT industry has witnessed in 2016, this projected growth underlines why 2016 will forever be counted as a phenomenal year for SVOD content providers.
2017 will continue in much the same vein, as OTT service providers build on a concrete foundation that the year just passed has provided. While mobility will continue to drive the sector’s growth, there will be greater push for enabling seamless, device-agnostic experiences to allow users with more viewing flexibility across multiple screens. UI and UX will reach newer heights as technology continues to change the way consumers interact with their preferred video-based content with highly personalised recommendations. The year might also see large-scale integration of Augmented Reality (AR) and Virtual Reality (VR) technologies into content development and enablement for a more immersive entertainment viewing experience. The demand for original, user-centric content will grow on the back of an extremely favourable 2016, and will see more and more OTT platforms curating content meant to be consumed by regional and cosmopolitan audiences.
(These are purely personal views of Sony Pictures Networks India, digital business’ executive vice president and head, Uday Sodhi and AnimationXpress.com does not necessarily subscribe to these views)