Netflix, Amazon Prime Video and Disney+ Hotstar together may dwarf the collective investment of Rs 2080 crore by local OTT players, according to London-based tech research firm Omdia Buoyed by the growth in 2020, over the top (OTT) giants Netflix, Amazon Prime Video, and Disney+ Hotstar are expected to up their original content investment in 2021. London-based technology research and consulting firm Omdia has projected that the three OTT players are expected to collectively spend approximately Rs 2824.9 crore ($383 million) on original content in India, dwarfing the Rs 2080 crore ($282 million) by local OTT players. The local operators include the likes of Eros Now, SonyLIV, MX Player, Voot, ALTBalaji, Jio TV + Jio Cinema, Hungama Play, and others. The OTT players are collectively expected to spend Rs 4905 crore ($665 million) in 2021.

The report noted that the huge investment in online video is also indicative of the shift from traditional to online, despite massive efforts to upgrade the cable TV network in India, which has reached full digitisation. It further stated that the COVID-19 pandemic put pressure on cinemas and forced content owners to look at online distribution platforms. Likewise, operators are investing in hybrid STBs (principally Android TV), to take advantage of the shift to online. With this backdrop, India will become a key market for growth in OTT video during 2021, the report said. The online video market in India is experiencing an impressive increase, growing 50-fold in subscription numbers between 2015 and 2019 on the back of original local content. According to Omdia, companies have recognised the importance of this segment, so a big spike in original content investment is expected in 2021. "Investment in Indian original content has grown exponentially since 2017, triggered by the entrance in the market of the US giants: Netflix and Amazon Prime Video. The two US OTT services have, in essence, transformed the Indian content production sector – not just by the sheer amount of investment, but by establishing content creation for online distribution as separate and independent from the TV business. Until 2017, when Netflix and Amazon released their first Indian originals, the Indian OTT platforms were dominated by content initially produced for TV," the report said. Netflix and Amazon Prime Video are the two largest investors in Indian original content. Omdia estimates that in the three-year period 2017–19, both have invested almost Rs 3687.9 crore ($500 million). The Indian OTT players are gradually scaling up their investment, and Omdia intelligence indicates that they will match the level of spending of the US giants in 2021. Omdia data shows that during the 2017–19 period Rs 6195.7 crore ($840 million) in total was spent on original content production in India. Investment in originals is forecast by Omdia to grow sixfold and during 2021–25 will total Rs 30,097.8 crore ($4.2 billion). Around 45% of that investment will be spent by the US giants – with the major Indian OTT video services spending much of the remaining 55%. This trend will become more prevalent in 2021. The COVID-19 lockdown and the relevant restrictions on TV and film shooting resulted in the postponement of around 30% of the projects programmed to start in 2020. Omdia predicts that the 2021 budgets will be around 15–20% higher, due to having to accommodate the 2020 postponements. The trend in 2021 will be helped by other factors, such as the intention of Disney to considerably increase its original production budget up to 2025. Sony India is another example, committing to produce 40–50 originals per year. Omdia expects more than 400 original titles to be released in 2021 from US and Indian players, with the total of original productions moving closer to 1,000 per year by the second half of the decade. The original production in India is also supported by the popularity of its content globally, offering the OTT players further options for monetisation. India had around 40 OTT services in early 2020. Omdia expects this number, through a range of mergers, acquisitions, and business partnerships, to drop to around 20 by 2025. The Indian film industry is one of the most prolific movie businesses globally, producing around 2,000 films per year, generating revenue of Rs 19,177.4 crore ($2.6 billion) in 2019, selling over 2 billion tickets, and providing employment opportunities for millions of Indians. The COVID-19 pandemic has delivered a heavy blow to the business model of this industry. Cinemas have been closed since March 2020 and a planned re-opening by the end of October 2020 will feature a drastic reduction in their capacities due to social distancing measures. Multiplex owners complain that under the new rules they are about to lose around 40% of their pre-COVID revenue. Restrictive measures in theatres are not the only concern that multiplex owners are facing: the closure of theatres has forced film producers to exploit other models for monetizing their assets. One such model is releasing blockbuster films on OTT platforms. Amazon Prime Video, Netflix, and Disney+ Hotstar were the first services to benefit, acquiring exclusive rights for several major Bollywood films that were about to be released theatrically in 2020. Indian OTT players like ZEE5, SonyLIV, and Voot Select are also following this path and, with the future unclear, Omdia anticipates this to be a prominent trend during 2021.