Industry Analysis

OTT SERVICES IN INDIA

Submitted By:
Rohit Raj
Why I have chosen the Industry?
With cellphone in almost every Indian’s hand and digital content at their fingertips, content
driven platforms like Netflix, Amazon Prime Video, Zee5 etc. have seen a surge in the
subscriptions. This type of change in content consuming behavior was fueled because of the
digitalization in the country.
 Over the top (OTT) refers basically means television and film content provided via an
Internet connection rather than a satellite or cable provider.
 Over the top (OTT) has become popular and this is the reason behind platform’s tremendous
growth. Also, platforms are moving from showing licensed content to providing its original
content.
 It has become an interesting field to study as Ott platforms have been rapidly growing in
popularity and profitability, especially among millennials and generation Z, which has
brought in tough competition. It is rapidly growing in countries like India and other
developing countries.
 With the arrival 5G networks soon, disruptive and exceptional experience to the customer
leading to newer business opportunities will enable these platforms to attract, gain and retain
customers.
 Distributors and Content creators are finding new ways to attract and appeal to consumers as
individuals. Also, marketers are trying to figure out on how to meet consumers at the point of
consumption and induce them instantaneously towards making purchase.
Major
Players
 Market Segmentation

By
Conten
t

Market
Segment
By By
End Geograph
y
user

By geography it is
segmented as:
• Metropolitan
• Urban
• Rural
Customer Segments
• Digital only – consume content only on digital platforms, do not access
television.
• Tactical digital – Consume Pay TV and at least one paid OTT service
• Bundled digital – Consume Pay TV and generally only telco-bundled
content
• Mass consumers – Consume Pay TV & occasionally some free OTT
content
• Free consumers – Do not pay for content

Users in millions
Customer Segment 2018 2019 2022

Digital Only 2.5 8 14

Tactical Digital 12 34 91
Bundled Digital 218 262 363

Mass Consumers 426 316 176

Free Consumers 180 190 220

Archetypes customers in the Indian market:

1) Traditionalists – who primarily consume on other than OTT platforms.

2) OTT Experimenter – who has significant consumption on both

conventional and OTT platforms.

3) Early Adopter – whose primary consumption occurs on OTT

platforms. While early adopters are still a more urban phenomenon, going
forward it will be more equally distributed.
 Challenge
s
The OTT industry has evolved from web-series on YouTube to a proper third
screen experience, attracting a magnitude of viewers to the ecosystem. Having
said that, as the industry is maturing, it faces the big kid problems which
include:

• Poor Infrastructure: India’s non-uniform broadband infrastructure/current

infrastructural capabilities do not allow a subscriber to view a video with optimal
quality and at the same speed everywhere.
• Privacy: Indian OTT players generate significant traffic from streaming of live TV
channels. As a result, the privacy of content , especially illegal live streaming of
sports matches , is significant concern. With the growth of broadband , privacy of
content may further increase, impacting subscription revenue potential for OTT
providers.
• Issue of monetization: Monetisation of content with revenue models which can
increase ROI for your business.
• Generating quality content to engage customers and keep them coming
back for more: Nowadays, viewers do not prefer to browse through numerous
channels to get what they what. With the plethora of options out there they are
likely to get distracted easily. They need a more personalized experience and this
is where a growing challenge lies for OTT providers.
• Reaching a global target audience: Many OTT providers are focused on
delivering content which may be restricted to a specific geographical location
while providing their services. Niches are served with specific language content
or catering to specific interest groups.
• Multi device viewing: With multiple devices available today, a majority of the
viewers have access to smartphones, tablets, and smart TV’s and hence the
challenge for OTT providers lies in providing content in a format, which can
delivered seamlessly across all these different devices.
• Viewer retention: The biggest challenge that lies ahead for OTT players is the
question of how to retain their subscriber base. This is a key challenge and could
involve treading a fine line between user experience and monetization.
BRAND POSITIONING & BRAND
VOICE OF SOME KEY PLAYERS
• YouTube is not just a video website or
one of the most visited places on the
Internet: it’s one of the world’s main
search engines.
• That's why a SEO positioning strategy for
YouTube is necessary to position a
channel or achieve more visits to the
videos.
• Positioning strategies for YouTube have a
double purpose: visibility within the
website, and generation of traffic to the
desired content (lead capture landing
page, ecommerce, other websites, etc.)
• Netflix is officially “Streaming Ready”.
They have shifted its brand positioning
from DVD rentals to streaming as its
core service. A major change for the
brand (and for the better, as we know).
• The obsession with customer
experience, finding out audience
behaviours and discovering which
features and presentations worked is the
hallmark of Netflix’s success.
• The user interface of both the app and
website is so unique that the customer
can reach the last of the page with just 2
scrolls.
• The original content of Netflix speaks
for itself and also the acquisition of
contents that are popular among the
audience can be found easily.
The company focusses on major 5 strategies:

• Original Content- This has played a significant role in amassing customers for the platform. The
company found it profitable investing in its own content rather than just waiting on the production
houses for the rights.

• Run Multi-Channel Campaigns- Gone are the days where people solely interacted with content from
their computer screens. Today's consumers want on-demand access from their smartphones, tablets
and even watches. For this reason, multi-channel campaigns play a huge role in Netflix's marketing
strategy. It runs campaigns on social channels and also innovates with customer engagements like
partnering with Snapchat to create an Augmented Reality Experience while promoting Stranger
Things. These campaigns are instrumental in its success.

• Favour Simplicity of Design- Everything is neatly organized by category, images are used generously,
and nothing extraneous competes for your attention. The homepage literally features two
messages: "Watch anywhere" and "Cancel anytime.“

• Utilize Data Metrics- Netflix has truly taken consumer data collection to another level, thus allowing
it to further improve their services. The company stores information on watch content; when you
pause, rewind, or fast-forward; and what kind of content is viewed on which day. Netflix uses that
data to suggest additional content that makes users continue watching. The company also allows
metrics to inform their launch strategies. A/B testing plays a pioneer role in gauging the customer
behaviours.
• The amazon brand name is enough
to establish trust among the
consumers.
• The range of contents in both
English, Hindi and local Indian
languages is something that makes
it standout from the competition.
• The original content too is very
varied and has actors from the
mainstream movies.
• The user interface is simple and it
gives users ample settings to make
their stay on the app smooth.
 Subscription Charges
• Monthly- Rs 129
• 3 months- Rs 329
• Yearly- Rs 999

Amazon’s backing works like charm for the platform. A consumer when subscribes to Prime
Video, they don’t just get introduced to a sea of content but also get a 1 day delivery on
Amazon orders. This bundled offer has put Prime Video ahead of it competitors.
The market strategy of Amazon:

1) Competitive Pricing- The pricing model is such that it catches the eye of anyone who visits.
It is much lower as compared to the competitors.
2) Content- Amazon Prime’s regional content speaks for itself. It has a collection of movies
and series dubbed in regional languages which gives it an edge over its competitors. Also
the storyline of the series connects easily with the audience and keeps them engaged. E.g.
Mirzapur, The Family Man etc.
3) Data Analytics- Being a subsidiary of the Amazon brand, it has access to huge amount of
data which it uses to its advantage to target the right audience at the right time.
4) Email Marketing- Promotional emails are sent directly to the consumers to make them
aware of the new content that is being provided.
5) Digital & Social Advertising- Being a huge brand it has unlimited resources at its disposal to
spend. Their strategies on these works well as the make full use of all the present social
channels to communicate with the audience. All the tools helps them to expand their
customer base.
• Hotstar has made its mark in the
OTT market within a real short
span of time.
• It is mostly popular because of its
sports content and the originals.
The star network has sponsors
sports all around the globe and
the easy availability on the
platform makes it user’s first
choice.
• The original content on the
platform especially the regional
ones are a treat to watch with
friends and family.
• IPL and Premier League are one
of the most viewed things on the
platform.
• It has segmented the market based on the genres of the TV shows broadcasted in
certain languages coupled with those consumers who are interested in the live sports
events going on around the world.
• It has been positioned itself as a video on demand platform which is convenient, rich
in experience and broadcast quality video to fulfil the digital consumption desire of
the audiences.
• It operates in the segments such as TV shows, Movies, Sports events, News and
premium shows. In TV shows the company has 28 channels in its portfolio which are
helping it in providing a bouquet of TV contents to the customers under one platform
for free. Its sports segment is the distinguishing channel of operation wherein
company has been taking broadcasting rights for the live events.
• The brand operates through business model Freemium wherein some of its contents
are free for the viewers while premium contents are only for subscribers.
• Broadcasting regional and local content, exclusive rights for some of the shows are
factors that are helping Hotstar to compete in the market. The company also has a
content partnership with some of the renowned studios of the world such as Disney,
HBO and FOX.
• Hotstar advertises itself through various mediums such as Google AdWords, Sports
events such as IPL, ICC tournaments, and other sports tournaments such as Kabaddi,
Badminton, Football, Tennis etc.
Communication
Matrix
Most of it is done through promotions and advertising. The players use
ads as a mainstay to connect with customers. They can be seen using all
the channels be it print media, digital media etc. Every player uses their
own promotional strategies to stay in the competition. The
differentiating factor is the key for the players to stay ahead. Appealing
to the customers through content is the most common. Having a
dedicated platform for all devices helps. The more easy is the
accessibility, more customers can be generated. The digitalisation has
helped and now it is a lot easier to reach the customers. But the
availability of numerous players also makes it hard for a player to
deliver because one mistake and the customer shifts. Th customer
lifetime value is very short considering these services.
 Digital Marketing & Social Media
Knowing the audience is the first and foremost thing these OTT platforms consider and then form their
strategies around them. The techniques that these platforms use are:
• Search Engine Optimization: Visibility in the organic search and ranking is increased through effective
SEO strategies. They use simple and catchy keywords e.g. watch movies, movies online, watch TV, TV
online, TV shows online etc.
• Use of header tags: They make the best use of header tags with simple sentences.
• Due to its excellence in SEO strategy, they get high engagement rate through binge shows, and through
popular links.
• Content optimization: It is the key element in a platform’s success story. The new content updates
optimizes regularly based on user’s behavioural patterns. The more the availability of the original and
good content more is the views generated.
• Social Media Management: It is used as a powerful influencer tool when it comes to reaching out
audience. Regular updates on Facebook (2.2 billion users), Instagram (1 billion users), Twitter(660
million users) proves to be a game changer. The more crisp and clear the message, the better is the
conversion.
• Analytics: This plays a major role in the colossal growth and brand loyalty of a platform. Analysing all
the details related to viewers’ behavioural patterns such as pausing, skipping, repeating, taking
screenshots, categories they search for, the area and timing of their engagement etc. helps them to
propose and adopt new strategies in digital marketing for improving the results i.e. user satisfaction.
• India’s Over the top (OTT) industry has jumped a whopping 240 percent between 2016
and 2019.
• The India Smart TV & OTT Market is expected to register a CAGR of 5% over the
forecast period 2020 to 2025.
• This growth is being driven by rising affluence, increase in penetration of data into rural
markets and adoption across demographic segments including women and older
generations.
• In fiscal year 2018, the OTT market in India was worth US$303 million as of 2018, and its
value grew to US$464 million in 2019.
• According to KPMG Media and Entertainment Report 2018, the Indian OTT market is
expected to grow 45 percent to reach US$823 million by the end of fiscal 2023. According
to a report by Ernst & Young, the number of OTT users in the country will reach 500
million by 2020, making India the second–biggest market after the US.
The next few slides will contain the following:

• Communication Analysis
• Post COVID era Communication
Changes
• Market Adaptation
• Strategies to Stay Ahead
 Covid-19 Market Analysis

• Amidst the COVID-19 pandemic, OTT platforms are experiencing a unique moment.
With millions at home, people are craving new content.
• Because of the major disruptions caused by COVID-19, these OTT platforms have even
become landing pads for feature films and studios as they respond to movie theatre
closures.
• As such, we’ve seen rapid home releases of contents on almost all the new platforms. Be
it acquiring of an all time favourite movie or TV series or the release of original content.
• Additionally, with fans yearning for sports content, many platforms like ESPN and
HOTSTAR are catering to the needs of the customer.
• Digital Marketing thus plays a major role during this crisis time. As OTT offerings
continue to grow and change, social media platforms are an effective channel to drive
OTT adoption rates while offering much-needed escapist content.
 Post Covid’19 Communication
• Historically, OTT brands excel in social media marketing by using their original content
as the centre piece of their ads. While many are consuming content on social channels,
OTT brands can utilize this unique content to persuade users to tune into their offering.
• In addition to the number of eyeballs available via social media at this time, another
opportunity for OTT brands is presented in the fact that the space is less crowded with
many pausing media efforts due to affected business operations, sensitives and more.
• As OTT platforms and studios are promoting their new movies, they must take well
thought out steps. First, they must figure out what their objective is. Next, identify the
target audience for the movie itself and align it to which social platform makes the most
sense.
• Video is always the best option for OTT platforms since that is their primary output. For
shows and films alike, trailer-specific content is readily available and can be adjusted into
six second or 30 second cuts to post across various social media outlets.
• For OTT brands, direct to home releases could be a norm for them going forward. As
such, during this time they should build good partnerships with movie studios while they
have the upper hand.
 Market Adaptation Techniques

Ott platforms mostly follow two theoretical framework to adapt to customers:

1) Innovation Adoption Model(AIETA Model)
• Awareness: The consumer comes to know about the innovation but lacks
information about it.
• Interest: The consumer is motivated to seek information about the innovation.
• Evaluation: The consumer considers whether to try the innovation.
• Trial: The consumers tries the innovation for the first time.
• Adoption: The consumer becomes a regular user of the product.
 2) Uses and Gratification Theory

• The theory of Uses and Gratification aims at explaining the way in which people
use media to fulfil their needs and derive gratification out of it.
• People tend to get interact, receive knowledge, relax, be aware and entertain
themselves through the media which they find convenient to use for interpersonal
communication as well.
• Users become an active ingredient to the communication process, being goal
oriented in their media use.
• The theorists suggest that media user look for specific media sources that will best
suit their needs and satisfy their gratification.
• Uses and gratifications assume that users have more than one choices to satisfy
their need. This theory unlike other theories holds that users are accountable for
selecting media that matches with and satisfies their desires and needs.
 Adoption Factors
• Convenience- The marketers or the app developers need to take into consideration for
whom is the app being made for and for what purpose. These two questions need to be kept
in mind as different target groups have different perceptions about convenience. So, if the
target group and the purpose of the target group in using the app is clearly understood by
the brand, the OTT platform brand should work to enable these facilities and communicate
it to the target group.
• Mobility- The need of the hour is something “on-the-go”. OTT platforms gives flexibility
to the viewer to watch any programme wherever he/ she goes. For enticing customers to
avail the OTT brand, the marketing should be done in such a way that the benefit fits into
the enhanced mobility need of the customer.
• Content-The variety and type of the content is something that brand managers and
platform developers need to concentrate on, so that there are repeat viewing on the
platform. This is possible only when the theme of the OTT platform, the audience and the
content is in sync with each other and creates an effective connect among themselves. This
process will ensure that consumer connect is optimum on the platform.
• Cost- OTT video platforms have a peculiar problem especially in a market like India. The
concept of a paid subscription is still quite nascent in the market and thus most people are
still restricting themselves to either free content or limited free period that the
brand/platform offers. The platform should make people aware about the benefits of
subscription and why they should prefer choosing them. The clearer the message better is
the response rate.
 Opportunities that exist for OTT players in the future

• Emergence of new markets - By 2025, digital growth will add over a billion middle tier
consumers in the upcoming markers for telcos. This will open up new markets for many
OTT players. The OTT services will comprise voice, messaging, content consumption,
and video calling services.

• Service offerings would be cheaper - The world of OTT is starting to merge with the
world of core telco services including voice, message, and media and this trend will grow
in the future. Beyond the basic, opportunities have also opened for premium or niche OTT
services. Low- cost access to high quality, unique video content with a good subscriber
base is at the vanguard of that trend. Specialist service providers who offer premium
content with the right blend of engagement and technology may be able to attract a larger
number of subscribers and greater profit.

• Live streaming channels will grow in demand - OTT operators will start offering more
live streaming channels in the future and will start operating even more like cable TV
companies. Besides, OTT content will see a transformation with breaking news reaching
Periscope, Facebook Live, and even YouTube.
 Strategies to Stay Ahead

• Content: The focus must be more on boosting content discovery functionalities

with improved ways to map the viewer’s habits and choices. Viewers prefer
service providers who can give them suggestions on what to watch and who can
help them find content that interests them.

• Global Presence: The focus needs to be on a middle ground that targets

international customers worldwide with a consistently high level of customer
service and experience.

• Multi device: OTT providers should look for technology partners who can enable
them to provide similar quality of content across all platforms with a consistent
cross-device user experience.

• Retention: Superior free content and advertising that is unobtrusive are both the
need of the hour. The task for OTT players is to maintain that balance between
uninterrupted quality content, and meaningful ads that the consumers could
respond to.

• Differentiation, personalization, a robust technology platform, and a quality

viewing experience for the consumer will all prove key in this quest.
Executive Summary
The Covid-19 poses a challenge for all. These crunch times will lead to the make
and break of a lot of platforms. Since more and more people are getting access to
the internet, the number of users on the platforms is increasing manifold. Moreover,
the lockdown is providing more time for the consumers to be on such platforms.
According to a research an average Indian is spending 3hours and 56 min on these
OTT platforms daily and thus this is a huge opportunity for the platforms to
capitalise and prosper. The techniques and factors of adoption discussed should
play a big role for the OTT platforms to devise what’s best for the customers.
Digital and Social Marketing provides ample opportunities to create awareness
among the masses. The audience is content driven so it poses a challenge for the
company to always be up with good and interesting content. Also the user interface
should be easy to understand. The subscription package should be devised catering
the customer behaviours. The opportunities and the strategies will be key in
determining the success of the platforms.
THANK YOU!