Since its inception in 2018, Zee’s streaming platform ZEE5 has been on an upward trajectory with a stellar double-digit growth in its subscriber base in the last fiscal year.
Its momentum extends beyond Hindi-speaking audiences, with significant traction in smaller towns. Furthermore, the platform’s foray into esports in 2023 has enabled it to tap into the younger demographic.
At the helm of ZEE5's operations, both domestically and internationally, is Manish Kalra, the platform's Chief Business Officer. In an exclusive conversation with e4m, Kalra offers a nuanced perspective on the evolving OTT landscape and ZEE5's strategic plans for continued growth.
On Industry Mergers and Sports Content
India’s OTT space is witnessing a huge churn at this point in time. In the last few weeks, Amazon Prime Video has acquired MX Players while the JioCinema and Hotstar merger has been announced. These developments have the potential to create a duopoly in the world’s largest consumer market, which may impact businesses, if not immediately, then in the long run, industry experts speculate.
Is Kalra concerned about the possible impact of these fast-track acquisitions and mergers? “MX Player’s acquisition and the JioStar merger will impact only if they resort to predatory practices like controlling advertising or discounting. Otherwise, if they play a fair game, and we play a fair game, it’s about who connects better with consumers, who's able to build the right content and get the right output at the right cost. That's where I would leave it,” Kalra said, clarifying that he usually avoids commenting on competition.
On lack of sports content
Hotstar and JioCinema managed to have an edge in the OTT segment, mainly because of their cricket programming. However, Zee5 has kept itself away from the high-cost sports content. Does it have any plans to enter the cricket rights segment anytime soon? Kalra says “NO”.
"We are focused on entertainment and do not plan to enter the sports content space unless there’s a strong ROI,” he explains. Sharing his apprehensions, Kalra said,
“We're cautious about high-cost sports like cricket. It's just the obnoxious costs that get associated with the rights. While there are platforms that are doing it, we have taken a call that we are not going to do mainstream sports.”
Kalra says, “Various historical data suggest that the sports broadcasting and streaming rights have been “very, very expensive” and most of the players who have these rights are using them to drive the top line, but are burning on the bottom line because of sports.”
“They are not able to recover the cost of those rights by way of either subscriptions or advertising revenue. And hence, while they use it to build either viewers or subscribers or top-line revenue. Ultimately, it impacts the bottom line in a negative way. That's our assessment. I could be wrong. But the suggestion is very clear that we are not focused on sports and we want to stay true to our strength of being focused on entertainment for Indians in Indian languages,” he said.
On 2024 Performance
Kalra says regional content, coupled with audiences from tier 2 and 3 cities, is doing the heavy lifting. Apart from Hindi, the platform is creating original content in Tamil, Telugu and Bangla. It also offers dubbed content in languages such as Malayalam and Kannada. Nearly 50% of its audience comes from these languages.
ZEE5 is prioritising regional content, enhancing its technology, and optimising costs through efficient content production and trimming the redundant and low-performing staff to expand its business while minimising losses, says Kalra.
This strategy has enabled the platform to increase advertising and subscription revenue while reducing expenses. “Our EBITDA losses decreased by over 40% year-on-year. In Q2 last year, our EBITDA loss was Rs 265 crore, and this year it is Rs 158 crore — a significant improvement”, Kalra shared.
Over 50 originals in 2024
In 2023, Zee5 launched 37 to 40 original content pieces, including web series and films. This year, the slate is already filled with 45 pieces and a few more are likely to hit by the end of this year taking the total figure to 50, he said. However, he clarifies that it’s not about the quantity; it’s about the quality of content, the topics, genres, and the creators involved that make a difference.
"I think 2024 has been a very good year. We started January with the launch of Sam Bahadur, which actually was one of the most successful movies that we had on our platform this year. While Sam Bahadur didn’t do so well in theatres, it actually did very well for us because of various reasons."
"Kerala Story, which is again a very sensitive topic and based on a real true story, worked very well for us. Hanuman in the South also did well. Then we launched Sunflower. I think this year we have launched almost, let me count, 45 to 46 content pieces till today."
"We’ve seen good success with our originals like Sunflower Season 2, Silence (the Manoj Bajpayee movie sequel), Broken News Season 2, Rautukaraz with Nawazuddin, and Kakuda. Our series Gyaara Gyaara and Murshid have done well in terms of engagement and new subscriptions."
"This year we’ve launched content in Hindi, Tamil, Telugu, Bangla, Marathi, and Malayalam. Watch time for users has gone up 25% year-on-year, with 90+ billion minutes of content consumed.
"Regional markets are driving almost 50% of our total consumption now, and Tier 2, 3, and 4 cities make up about 40% of our subscriber base, up from a very small number two years ago."
‘To continue double-digit growth in 2025’
We hope to continue the double-digit growth in the coming year as well, Kalra said when asked about the growth projections.
“Zee5 aims to go deeper into regional languages like Hindi, Tamil, Telugu, Bangla, and Marathi. We want to focus on storytelling that resonates with diverse cultures and folktales. We are experimenting with dubbed K-dramas in Hindi and engaging audiences with non-TV content like travel and food shows. The plan is to scale relevant content for both AVoD and SVoD platforms,” Kalra said.
On own FAST Channel
The rise of Free Ad-supported Streaming Television (FAST) channels is carving out a new revenue avenue for news broadcasters. Zee5 looks forward to joining the bandwagon.
Kalra shared, “The content available in fast channels is very different from the perspective of quality and the premiumness of content that we do on OTT channels. So, I think it's a different audience. Fast channels are usually playing in the background or the consumer is kind of not paying up front. So, the quality of content would be dated or may not be premium, but there'll be an audience which wants to get entertained at that as well.”
We will participate in building our own FAST channel and will take it up on the key platforms in the near future as well, Kalra noted.
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