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Business News/ Industry / Short-term subscriptions find draw in India’s cluttered OTT market
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Short-term subscriptions find draw in India’s cluttered OTT market

Media and entertainment industry experts say monthly or quarterly plans are gaining prominence from a platform perspective about two years after they began to be introduced

For the consumer, it is a happy situation to be in considering annual plans are expensive, and not value for money if you’re locked into a platform for a year.Premium
For the consumer, it is a happy situation to be in considering annual plans are expensive, and not value for money if you’re locked into a platform for a year.

New Delhi: As video streaming platforms multiply and the battle for consumer eyeballs and wallets increases, the platforms are increasingly banking on shorter subscriptions to increase their subscriber base and garner higher revenue.

Media and entertainment industry experts say monthly or quarterly plans are gaining prominence from a platform perspective about two years after they began to be introduced. Factors moving this trend include cheap, bundled OTT (over-the-top or streaming) packages for 300-400 per month from telecom and other aggregators; plateauing D2C (direct-to-consumer) subscriptions from the OTT firms; and escalating content creation costs.

For the consumer, it is a happy situation to be in considering annual plans are expensive, and not value for money if you’re locked into a platform for a year that’s not providing enough engaging content through the subscription period.

For example, Disney+ Hotstar offers a 299 monthly plan and a 499 quarterly plan, versus 1,499 a year, for premium content. SonyLIV offers a 299 monthly plan and a 999 annual plan. Netflix, of course, has had monthly plans from when it came into India.

"Monthly and quarterly plans have become more crucial recently with telco and aggregator bundles offering cheap OTT packages. As content production and marketing costs escalate, there is no other option because most users have already sampled some portions of OTT as part of free trials," said Girish Dwibhashyam, vice-president, strategy and business head at DocuBay, a documentary streaming platform. DocuBay has a 199 monthly plan, 499 quarterly and 1,499 annual plan.

A revenue head of another OTT service added on condition of anonymity that short-term plans are seeing more traction among users, although the aim is to convert them into annual subscribers.

“This shift is driven by the flexibility these shorter plans offer, allowing users to adapt their subscriptions to changing viewing habits and financial circumstances," Chandrashekhar Mantha, partner, media and entertainment sector Leader, Deloitte India, said. “Additionally, the lower upfront cost makes it easier for folks to give a service a try without committing to a hefty annual fee upfront."

For a sports season such as the IPL (Indian Premier League) or families tuning into holiday specials during vacation periods, a shorter commitment fits better. And for those who have day jobs, monthly or quarterly payments fit better into their budgeting preferences, Mantha added.

Even though yearly subscriptions are cheaper by about 30% for most OTT platforms (barring Netflix), many users still opt for monthly or quarterly plans, Sandeep Bansal, managing director, Chaupal TV, a platform specializing in Punjabi, Haryanvi and Bhojpuri content said.

“Streaming services aren't a top priority for them yet. They often prioritize traditional cable or DTH networks. When they do want to watch something on a streaming platform, they prefer paying a small amount just for that particular movie or show," Bansal said, adding that the platform brings out three new products every week, and aims to release major content in the first week to 10 days of each month when people are more likely to spend money and consider longer subscriptions. Chaupal TV has a 149 monthly plan and a 799 annual plan.

With the availability of multiple streaming platforms today, consumers need to make a choice at any point in time. So, instead of buying annual plans, many go for monthly plans and rotate between platforms for affordability, media experts say. “The idea is subscribe to one platform in a particular month, consume interesting content, and then skip till it builds up a pipeline of new, interesting content," said Neeraj Sharma, managing director, growth markets media lead, Accenture. “To ensure audience retention, OTT platforms need to focus on two key aspects—build a steady supply of quality content that may not necessarily involve high cost, and try to invest in franchise-worthy shows."

To be sure, monthly and quarterly subscription plans give users moderately priced options, while meeting other business goals. Avinash Mudaliar, CEO, OTTPlay, the recommendation and content discovery platform for streaming services launched by HT Media Labs (part of the same organization as Mint) said a span of one to three months allows a user to fully explore an OTT’s content, and drives better user stickiness for the business.

“Ads are typically placed in sports matches or reality TV-based content, where users are more likely to expect them. These types of content usually last for one to three months, making it easier to place ads within shows such as MasterChef India, Shark Tank, KBC, and so on. Shorter plans look more attractive to users in terms of the value offered, and when presented through large-scale launches, drive both awareness and conversions," Mudaliar said adding that OTTPlay has observed that sales of monthly and quarterly packs have grown six times over the past year, and quarterly plans, especially, balance both consumer and business needs. 

Meanwhile, streaming platforms are also strategizing content to meet evolving user preferences. Many services are experimenting with shows that drop episodes regularly like in conventional television, instead of dropping entire seasons of a show at one go. Going forward, some shows may have 30-50 episodes, but can go up to 100, and will be released in a staggered manner. This presents an effective strategy for OTT platforms to adapt to the trend of shorter subscription plans, particularly for genres like drama and comedy, building anticipation and boosting engagement.

“With a sizeable 35% of paid (B2C) subscriptions in India coming from just 15 cities, the endeavour for SVoD platforms will have to be to get cities across Tier II and Tier III into the fold. These are also the cities which are more price sensitive than the metros and mini metros, and will be extremely resistant to the annual high-price packages. Opening up the small-package options will enable these markets to deliver higher volumes," Keerat Grewal, head, business development (streaming, TV and brands) at media consulting firm Ormax said.

 

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ABOUT THE AUTHOR
Lata Jha
Lata writes about the media and entertainment industry for Mint, focusing on everything from traditional film and TV to newer areas like video and audio streaming, including the business and regulatory aspects of both. She loves movies and spends a lot of her free time in theatres, which makes her job both fun and a bit of a challenge given that entertainment news often just talks about the glamorous side of things. Lata, on the other hand, tries to find and report on themes and trends in the entertainment world that most people don't notice, even though a lot of people in her country are really into movies. She’s a graduate of the Columbia School of Journalism.
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Published: 27 Feb 2024, 05:28 PM IST
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