The session titled ‘Content: Rise of On-Demand Models’ had four speakers and was moderated by Karan Taurani, VP, Elara Capital Indian over the top (OTT) has seen phenomenal growth in the last five years due to the growing penetration of smartphones and affordable data prices. There are over 60 SVOD and AVOD platforms in the country vying for a share of the growing OTT pie.
Globally, OTT has led to cord-cutting in matured markets, however, in India, OTT and TV will continue to co-exist. The emergence of OTT platforms has proved to be a boon for content creators even as OTT platforms are struggling to devise a profitable business model.
These and some other key points were raised during a panel discussion at Elara Capital’s recently hosted VIBES 3.0, the Everywhere Content virtual event on 6th January.
The session titled ‘Content: Rise of On-Demand Models’ had four speakers namely SonyLIV Content Head Amogh Dusad, Kavithalaya Productions CEO Bharathan Kandaswamy, ALTBalaji SVP (Revenue and Marketing) Divya Dixit, and Friday Filmworks Head Devendra Deshpande. The session was moderated by Elara Capital VP Karan Taurani.
Divya Dixit noted that TV and OTT will continue to co-exist in India. She also noted that over the top (OTT) platforms are male-skewed while women are loyal audiences of GECs.
Amogh Dusad further stated that TV and OTT audiences are not mutually exclusive. While there is an audience for both platforms, a lot of consumers watch content on TV as well as digital.
He cited the example of The Kapil Sharma Show which gets good traction on TV (SET) as well as digital (SonyLIV).
SonyLIV, he said, had a great run in the last three months of 2020 as it had a hit show like Scam 1992 followed by the India-Australia series. The platform had seen a growth in consumption as well as revenue.
Devendra Deshpande stated that in a usual production of OTT content, feature film duration is 2-2.5 hours while web series is for eight hours. Hence, each episode is treated as a feature film and the sequel is the next episode.
Bharathan Kandaswamy said that the regional OTT space is the next big area of growth. OTT platforms, he noted, have already started investing in regional content. During the pandemic, there was a surge in consumption of Tamil, Telugu, and regional content. This was also driven by the release of regional blockbuster movies directly on OTT platforms as film producers were not able to sit on high cost for indefinite period.
According to Kandaswamy, the www of content is whenever, wherever, and whatever.
South India has started to embrace OTT platforms. An estimated Rs 150 crore is expected to be spent on regional OTT content. TV viewership is continuing to well to coexist with OTT for the next 5-10 years. However, TV content needs some innovation from old same type of content
He said that there is no substitution for TV in South particularly in Tamil market where TV consumption continues to be extremely high. He also said that there is a need to have an integrated content approach for TV and OTT.
Amazon Prime Video, he said, had entered the COVID-19 phase with a big budget of Rs 1000 crore for content recently but that money was mainly spent on acquiring movies. ZEE5 has a strong focus on web series while global OTT is not going the web series way.
He also highlighted the issue of poor compensation for production houses. The production house is paid at a mere 10% as fee which is not adequate for making quality content.
Deshpande said that the starting point for a web series is never about the budget. There has to be a conviction of the concept. Budgets are decided on the basis of creative vision and legacy. He also success and failures also decide budgets for a web series.
He noted that there have been examples of low budget but successful web shows as well high-budget not so successful shows.
He also said that the budget numbers have changed over a period of time. OTT platforms, Deshpande said, are taking a punt with content.
On the value of content, he said that the fate of a movie is decided over the weekend while OTT content might get discovered after six months. There are no hidden formulas for a successful show, Deshpande asserted.
Amogh Dusad said that the OTT platforms are taking all the risk while investing in OTT content. Content creators, on the other hand, are having a gala time as a lot of money is invested in creating original web content.
Responding to Dusad’s comments, Deshpande said that the production houses not part of downside but they are not part of the upside as well. He also noted that production houses don’t have any visibility on success and failure of content as there is no data sharing. Production houses, he said, also work on slim margins.
SonyLIV, Dusad said, will be launching Tamil and Telugu later in 2021 after having tasted early success with Hindi originals. He also stated that the platform couldn’t do launch original regional shows as it wanted to get the Hindi piece right.
If 2020 was about expansion into Hindi then 2021 will be about replication of that success in the South.
Scam 1992, he said, gave the platform 5X jump on all KPIs. He further stated that SonyLIV has just done six originals but in FY22 it has lined up big in volumes which is four times more than what it offered in six months.
Dixit said that ALTBalaji has been SVOD since the beginning and hence driven by originals only rather than acquiring movies. Once the audience comes via originals, it is a more sticky and loyal audience. Once the show clicks in the first season, the initial audience and the buzz it created via season 1 comes up for Season 2, which enables organic growth of the subscriber base for the OTT platform
She also said that ALTBalaji might be a small platform but it will break-even very soon. The platform is focused on a sustainable business model. She noted that lots of OTT platforms are launching and folding up. Going forwards, there will be lots of M&A in the space.
According to Dixit, it is important to have great quality content in the library rather than having hours and hours of content.
Dusad said that there are three types of OTT platforms - broadcast-owned OTT, international OTT platforms, and telcos/aggregators and independent platforms. They all have different business approach but there are similarities across buckets,
He also said that SonyLIV is focused on profitable growth with a tight lens on ROIs. Being freemium has helped SonyLIV build an SVOD base. The first episode of its web shows is free to allow sampling of content. AVOD funnel provides a great advantage in the form of a large captive audience.
The panelists also stated that self-regulation is better than government regulation as OTT consumers have the content.
The session titled ‘Content: Rise of On-Demand Models’ had four speakers namely SonyLIV Content Head Amogh Dusad, Kavithalaya Productions CEO Bharathan Kandaswamy, ALTBalaji SVP (Revenue and Marketing) Divya Dixit, and Friday Filmworks Head Devendra Deshpande. The session was moderated by Elara Capital VP Karan Taurani.
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