When Zee’s promoters announced in mid-November this year that they were pitching for selling half their stake in the 42 per cent they hold in Zee Entertainment Enterprises Limited (ZEEL), they were mainly seeking foreign entertainment majors eyeing the subcontinent for the lucrative and growing over-the-top (OTT) digital streaming market. This slice is so far free of cumbersome regulatory compliances, and it is the platform of the future.
With a wave of over 30 OTT digital platforms launching over the last three years in India, traditional television viewing, together with concepts such as ‘prime time’ and ‘appointment viewing’, are on the wane. The growing army of young smartphone users prefer entertainment anytime, anywhere.
Hotstar was the earliest of them launched from the Star stable in February 2015, on the back of streaming live ICC World Cup cricket; and it was able to garner 1 million downloads of its app within 10 days of launch! When IPL cricket rights went on the block in September last year, in the digital category, Star was competing with a $600 million bid from Facebook. Star ultimately won, but it was the first glimpse of where live sports and entertainment was heading.
There are widely divergent views on what is the size of the OTT market, but what they all agree is that revenue is galloping north. A Boston Consulting Group (BCG) report titled Entertainment Goes Online estimates OTT currently generating around Rs 3,500 crore annual revenue; and they could outstrip Rs 30,000 crore by 2023.
ZEE5’s late launch
Compared to others, Zee launched its OTT platform, Zee5, rather late in February this year. ZEEL’s advantage though is its huge 25-year-old film and TV series library, and its willingness to invest in local content. “If we are late, we are making up with better technology,” says Tarun Katial, CEO of Zee5.
Katial is firmly planted amongst a ‘We Work’ floor full of laptop-punching young techies in Mumbai’s suburb of Andheri, commissioning shows as if there is no tomorrow. He is also a seasoned campaigner, who has done time at both Star and Sony. Targets scribbled for his team on a planning board are mind-boggling. He is launching 24 series in a year in Hindi – two every month; also 24 in Tamil and Telugu, and 12 in Bengali. The next year will also see 12 made-for-Zee5 movies in Hindi and four other regional languages – 60 in all!
Zee5’s offering ranges from voyeuristic biopics ‘Karanjeet Kaur – the Untold Story of Sunny Leone’ to a nine-episode crime thriller from UP’s badlands ‘Rangbaaz’ being made by Arjun Rampal. Also in the pipeline are stories based on Ruskin Bond’s books and even one titled ‘Repeal Sec 377’ based on LGBTQ rights.
“Our focus is smartphone users in the 18-34 age group; and we have rolled out in 12 languages. It is the regional markets that are the future,” says Katial. He claims that despite the late launch, Zee5 has 41.3 million monthly active users. The great driver is local, original content and affordable packages starting at Rs 49 a month, he adds.
Sharp competition
Katial is optimistic, but his task is cut out, given the competition. According to mobile advertising and Internet services provider Jana, the first quarter of this year was dominated by Hotstar, which had 70 per cent of video streaming app downloads.
This has changed substantially. Another survey for September-November this year, by KalaGato said Hotstar continued to rule, albeit with lower market share of 40 per cent, and with Jio TV muscling in with 18 per cent. One could see Zee5 too making a mark at third place with 15 per cent share followed by Voot with 11 per cent. Netflix and Amazon Prime had little over 2 per cent each on their platforms.
Netflix follows a different ‘non-mass’ model considering its packages are in the Rs 400-800-per-month range. It has struggled for the last two years, but with the success of its eight-episode local production Sacred Games, and its international Narcos, it has arrived in the ‘luxury’ market. In terms of time spent, Netflix seems to be ahead with around 51 minutes per day, followed by Voot with 50 minutes, Amazon Prime with 42 minutes and Hotstar 33 minutes.
However, Netflix cannot compete with the kind of local content being generated by say a Zee5; and that’s what is interesting about the Indian market. OTT is galloping, but that doesn’t mean television and newspapers are not growing. The market is so diverse, that there are always takers for a specific price point, a platform and a type of content.