The Over-The-Top (OTT) market in India, following a compound annual growth rate of 36%, is projected to reach a size of approximately Rs 11,944 crore by 2023. This marks a significant leap from Rs 2,590 crore in 2018. According to a report by SBI Research, OTT platforms have already claimed a 7-9% share of revenue from the entertainment industry and are expanding with more than 40 players offering original content in multiple languages.
Presently, there are around 45 crore OTT subscribers in India, a number that is projected to touch 50 crores by the end of 2023. Notably, the pay-per-view segment, which accounted for 3.5 crore in 2018, is expected to climb to 11.7 crores by 2027. During the same period, video downloads were at 4.2 crores and video streaming at 1.9 crore; the respective figures are expected to rise to 8.6 crores and 10.8 crores.
Driving the OTT Growth
Multiple factors have fueled the meteoric rise of OTT platforms. Foremost among these are the affordable and high-speed mobile Internet, the doubling of Internet users, an increase in digital payment adoption, and competitive pricing strategies employed by global OTT players. Additionally, the Covid-induced lockdowns leading to cinema shutdowns have also played a role in shifting audiences toward OTT platforms.
This shift is reminiscent of the sudden death of the VCR/VCP/DVD industry in the 1980s due to the exponential rise of multiplexes. Now, OTT’s rise threatens to chip away at cinema profits, with over 50% of people spending more than five hours a month on these platforms.
Implications and Future Directions
OTT’s foray into domains such as education, health, and fitness is likely to solidify its position in the future. Furthermore, OTT platforms have unlocked new possibilities for content creators, transforming it from a medium of enjoyment to an essential platform for a broad range of content production and consumption.
What are OTT Platforms?
OTT platforms are audio and video hosting and streaming services that offer a variety of content to users. They use artificial intelligence to predict and suggest content to users based on their past viewing habits. While some content is available for free, premium content often requires a monthly subscription. Notable examples include Netflix, Disney+, Hulu, Amazon Prime Video, Peacock, CuriosityStream, and many more.
Regulatory Framework for OTT platforms in India
The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules 2021 were notified by the Indian government in February 2022 to regulate OTT platforms. These rules require publishers to appoint a Grievance Officer in India for resolving grievances within 15 days. To that aim, every publisher must become a part of a self-regulating body registered with the Ministry of Information and Broadcasting. This Ministry, alongside the Inter-Departmental Committee, forms the third-tier Oversight Mechanism. The rules also mandate self-classification of content without Central Board of Film Certification involvement.
