2021: OTT Battle for Market Share Intensify with Amazon offering AVoD
Silver Screens made way for Television Networks and subsequently TVs were superseded by Smartphones and today the smartphones are burgeoning with Over-The-Top (OTT) broadcasts. OTT has been luring audiences with exclusive content of their choice with customized entertainment options. Amazon Prime India, NetFlix India, SonyLiv, Disney+Hotstar, ZEE5, and dime-dozen players are fiercely competing for the market share. The Revenue in the OTT Video segment is expected to reach 278 Billion INR in 2021. OTT Advertising is expected to be the largest segment with 148 Billion INR in 2021. Most importantly Revenue in the OTT segment is expected to register an annual growth rate of 14.5% with a projected market volume of 480 Billion INR by 2025.
Moreover, the recent news about Amazon Prime exploring to changeover from Subscription-based OTT to Advertising Video-on-demand (AVoD) model has triggered a new wave of competition between subscription-based models and players like YouTube and Facebook who are already proven players in AVoD streaming. This Zeva Astras blog post covers the market share of OTT players, The traffic segmentation based on geography (metros, tier-1, and tier-2 cities) in the Indian subcontinent. The statistics of demand for content in local Indian languages and many more interesting figures.
Introduction
According to Statista analysis report, the OTT users in India is expected to grow up to 344.7 million. This clearly indicates the penetration of OTT into different geographies of India. The availability of good networks at an affordable price and the availability of multimedia-based smartphones at an affordable price, the lockdown caused by the pandemic COVID-19 are important factors that have helped the penetration of OTT across the Nation.
Business Models Employed
- Subscription-based Video Streaming (SVoD)
- Pay Per Video View (TVoD)
- Video Downloads/Freemium
- Advertising Video on Demand (AVoD)
Subscription Video on Demand is an OTT platform that offers services to customers based on a subscription price stipulated. Subscriptions usually are offered as monthly or annual packages. Amazon Prime and Netflix are popular for SVoD streaming services.
Pay Per Video or Transactional Video on Demand is opposite to SVoD streaming. Here customers pay-on-per-view-basis.
Video download services are used to download videos for viewing later offline.
Advertising Video on Demand is a service where users needn’t pay for viewing instead revenue is earned from platforms or advertising services.
Market Share of Major Players
Source: Statista.com
Geography Wise Users Statistics
Here is a chart showing OTT users distributed across Metros, Tier-1, and Tier-2 cities in 2020
Source: IBEF.ORG
Amazon Prime in India has bigger plans of entering into the AVoD segment in addition to its current SVoD model of streaming. Amazon also has plans to enter into tie-ups with Entertainment houses for a Revenue-share basis model. In this model, Amazon pays the producer a portion of the revenue earned by streaming content on its platforms. YouTube already established in the AVoD segment is pushing the Subscription Model by offering Ad-Free Subscription streaming. In nutshell, none of the players are able to make huge revenues through a single model of streaming and are trying to push content on SVoD, AVoD, TVoD, and Freemium modes.
Conclusion
The Researchers reveal that around 600 Million online users are present in India. But the fact is only a marginal portion of them are using subscription-based services. So OTT platforms have to strategize different models to monetize their services. The option in front of them is to use a Hybrid-Model comprising of SVoD, AVoD, TVoD, and Freemium services so that no stone is left unturned to capture real estate share on Consumer’s Smartphones.
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