The future of entertainment: Here’s what is going to drive growth in the OTT space
Like so much else that changed overnight during the global pandemic that hit 2020, the media and entertainment industry too rounded a bend that it is unlikely to return to again.
Distributed, over-the-top (OTT) platforms and smart TV penetration had already begun changing the way the world consumed content, especially entertainment, in recent years. What the pandemic and the resulting lockdowns did was to accelerate that process manifold.
With people forced to stay home for months, most OTT platforms saw an unprecedented rise in subscribers. Moreover, as Covid-19 guidelines and lockdown regulations prevented films from being physically released in theatres, major production houses too turned to OTT platforms for their new releases.
According to IBEF, the OTT sector in India saw the volume of paid subscribers rise by 30% to 29.0 million from 22.2 million during the March–July 2020 period alone.
India, the fastest growing OTT market
According to a recent PwC report, India is currently the world's fastest growing OTT market, set to become the sixth largest around the globe by 2024. The market in India is expected to grow at a CAGR of 28.6% over the next four years, touching $2.9 billion in revenues.
Industry trends indicate that with access to better networks, digital connectivity and smartphones, OTT platforms in India have been increasingly attracting subscribers on a daily basis. Apart from top favourites Disney+ Hotstar, Amazon Prime Video and Netflix, the space is seeing a plethora of local and regional OTT players, such as SonyLIV, Voot, Zee5, ErosNow, ALTBalaji, Hoichoi and Adda Times, to name just a few.
Convenience and privacy driving growth
The pandemic response aside, most industry research and studies on this recent viewership trend have found convenience and privacy to be the foremost causes of this shift in content consumption patterns. In a world where people struggle to make the most of their limited resource of time, juggling multiple responsibilities within 24 hours, the ‘anywhere, anytime viewing' concept of OTT platforms hit the right chord, in my opinion.
Today, most viewers, irrespective of their age or socio-economic status, watch content across more than one screen. Changing consumer lifestyles and ownership of/access to multiple viewing devices have enabled anywhere, anytime viewing. In short, people have found their own ways of consuming content.
Other trends driving growth
Content, as always, is king, and in my view will always remain a major driver of consumer growth. In fact, recent years have seen a massive rise in original content being aired on OTT platforms. Back in 2018, Netflix and Amazon alone had spent more than 40% of the overall production budgets of the world (SG Analytics, OTT and the Media & Broadcasting Industry: The Impact & The Way Forward).
Apart from creating original content and facilitating binge watching, networks and production houses have also begun to see value in getting rights to live events and performances. Audiences in India recently saw Filmfare and a streaming social network join forces for the first-ever OTT awards. This, I think, was a landmark event for India's media and entertainment industry in many ways.
Filmfare joined hands with a new age, streaming social platform to host the country's first OTT awards, signalled the arrival and acknowledgement of original content and creative talent by mainstream media. For nearly seven decades now, Filmfare has embodied the rich legacy of celebrating the best of Bollywood. The awards indicate that the time has finally arrived for the mainstream industry to acknowledge what has always attracted audiences in India—talent and content.
Tech tie-ups like these are enabling high quality products and customer-centric features, such as the opening up voting rights to the general public for the OTT awards. This move helped democratise the entire process of recognising talent in the OTT space.
I foresee that networks and film production companies will now increasingly partner with streaming social networks and other streaming video services and digital platforms, to ensure the distributed presence of their releases. The rise of the OTT industry is a new trend in India's entertainment industry, and the Black Lady of Filmfare fame took her first step in celebrating this change.
The future of entertainment
In India, the absence of a censorship board for web content, as yet, has also been fuelling creativity and, hence, viewership on OTT platforms. To continue attracting audiences and keep creativity alive, I feel that ideally all streaming content should offer viewers full disclosures of their contents, allowing consumers to decide for themselves. The future lies in AI and machine learning playing a role in automatically classifying streaming content and generating full disclosures.
In the last five years alone, according to The Economist, the streaming industry has spent more than $650 billion in acquisitions and content creation to woo consumers. Although content will continue to remain the biggest draw for audiences, I feel that technology also has a very big role to play here.
The next decade in this space will very possibly belong to not only those with the best original content, but also the most advanced technology, analytics and user-friendly features. Ultimately, the streaming wars will empower viewers and revolutionise how they consume content.
Streaming providers with the most seamless viewing and search experiences as well as the best personalized viewing recommendations, based on tech innovations, AI and analytics, will be tomorrow's winners.
This article has been written by Shashank Singh, Co-founder & CEO, FLYX