Rise of OTT Platforms

Unless you are living under a rock, you must have noticed or heard of the rise of OTT platforms all across the globe, and in recent times, more so in India. This growth spurt of OTT (over-the-top) the platform is the consequence of many factors such as low data prices, variable pricing models to suit every kind of user, the sheer quality of content on these platforms, and more recently, the global pandemic that has struck the face of Earth.
In these trying times, with a vast majority of the population stuck inside their homes. With the theatres closed for the foreseeable future, People have turned to OTT platforms such as Netflix, Hotstar, Amazon Prime Video, SonyLIV, Zee5, TVF Play, Voot, and many more, for entertaining content. Despite their massive gain in popularity, there are some things that people don't know about these platforms and many questions that they pose for the broader audience.

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1. Why are OTT Platforms gaining such a huge user base:
Like I mentioned earlier, several reasons have dictated the rise of OTT platforms. The youth of today seems to realize that the content provided by the traditional "TV channels" no longer fits their idea of entertainment and that they have generally failed to deliver quality content.
With these platforms providing shows and movies that are radical, thought-provoking and quite merely more relatable to the current generation, people are starting to switch to OTT platforms with many even unsubscribing from their DTH providers. In the wake of this scenario, some DTH providers like Tata Sky (Tata Sky Binge) and Airtel (Airtel XStream) have launched their own platform, which helps users to access all the OTT platforms in one place.
Another essential reason why OTT platforms are gaining popularity is one very crucial feature that they offer – accessibility on smartphones. This is something that was previously not possible, as you could not watch the shows or live sports broadcasted on TV, on your phone. With Netflix and Amazon Prime Video allowing its users to fully access the platform on their phones, more people started subscribing as they could now watch all the content on their phones. Following in their path, other companies like Sony and Star introduced their own platforms which gave their users access to all their TV shows as well as a plethora of live sports action.
This was a game changer in the sense that it brought sports fans into the picture because Sony and Star dominate the sports streaming market in India with Star having the rights to the IPL, Premier League and Formula 1 and Sony has the rights to the UCL and NBA among others. It was now much more convenient for people to watch live sports on their phone, at any place which only gave a massive boost to the popularity of OTT platforms.

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2. How OTT Platforms generate their revenue:
It is no surprise given the immensely huge user base these platforms have, that they are bringing in a lot of profit. But how exactly do they earn? The answer is quite apparent, a lot of their revenue comes from user subscriptions. However, they also make money from ads.
The interesting thing to notice here is that they spend a lot of money on gaining rights for movies and shows that aren't produced by them and hence they cannot profit unless they bring in a particular amount of user subscriptions, which is to say that they basically work on negative cash flow. Which is why there is a growing trend among the lesser-known platforms to produce their own shows, rather than buying rights for other shows and movies. Netflix has been creating content for a long time and also has many Indian films that have been produced by it.
Similarly, Amazon Prime Video has also been creating a lot of original content and also introduced stand-up specials to the Indian audience. Among the OTT platforms in India, Hotstar leads the pack with 400 million monthly active users, far ahead of SonyLIV, with 70-80 million monthly active users. Voot has more than 100 million monthly active users, surprisingly more than Sony, since Sony also covers a lot of live sports.
As far as paid subscribers go, Disney+Hotstar leads in this category as well with 8 million paid subscribers. However, SonyLIV has 14-20 million paid subscribers, there is a lot of ambiguity surrounding that figure (as to how many of those are directly paid). Amazon Prime has 4.4 million paid users, ahead of Netflix with 2 million users in 2019 according to individual reports (as Netflix does not reveal its user base data in India). Although that number will have surely risen as of today, it is clear that Amazon does have more users than Netflix, at least in India.
Netflix has over 167 million subscribers globally, and they plan on reaching 100 million subscribers in India itself! Although that may seem a bit far-fetched right now, it is undoubtedly possible soon.
Another notable platform in India is Zee5, which had 76.4 million monthly active users in 2019 and reports suggest that they have doubled that number in 2020. With 150-160 million monthly active users, Zee5 is certainly catching up to the big players and making its name in the Indian streaming market.

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3. Pricing models of various OTT platforms:
Just like its content, every platform has a different pricing model. Since all the platforms do not provide the same quality or quantity of content, it only makes sense that they charge different fees from their users. Having said that, Netflix has the highest annual cost in India, with its prices ranging from Rs.2,388 per year to a whopping Rs.9,588 per year. It also has a variety of different offers to suit every user's needs. They recently introduced an Rs.199 per month and an Rs.349 per month plan for only mobile users. The non-mobile plans start from Rs.499 per month.
Amazon Prime has only one plan of Rs.999 per year, which also includes a complete Prime membership which extends to their shopping site as well.
Disney+Hotstar offers an Rs.399 a year plan named VIP, which includes all their content in local languages. They also provide another plan of Rs.1,499 a year for Premium, which contains exclusive content (in the English language).
SonyLIV offers an Rs.499 a year plan while Zee5 provides its services for Rs.999 a year. Voot Select also costs Rs.499 a year.
AltBalaji Rs. 300 a year and ErosNow for Rs. 399 a year.

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4. Why you should consider using OTT platforms and which ones should you join:
Given the current situation, it seems very likely that theatres will not reopen for a considerable amount of time, and even if they do there will remain some lingering uncertainty and fear among people for some time. With all this in mind, lots of production houses are starting to contemplate the idea of online releases. The most recent example is Hotstar lining up 8 massive releases directly on their platform.
With Amazon also tasting success in Gulabo Sitabo, many filmmakers and production houses will be thinking about tying up with OTT platforms for digital releases.
A few months earlier, in April 2020, Universal Studios decided to release Trolls 2, both theatrically and digitally. The movie made history as Trolls 2 broke the previous digital box office record and grossed around $100 million just through its VOD (video on demand) release.
The most exciting part is that Trolls, the first part made around $150 million. Still, Universal could only profit $77 million because the studio only gets to keep about half of its box office earnings due to the theatres acting as middlemen. So, even though Trolls 2 made less money than its predecessor, the studio actually profited more from the digital release. This will undoubtedly make other studios think whether a digital version is a better option, especially in the current situation, given that they will get to keep a vast majority of the revenue generated.
Taking these things into consideration, OTT platforms will experience a surge in users more than ever. It seems logical to join the OTT platform bandwagon.
Yet, one question remains- which is the best one out of all. The answer is not so straightforward. Each one has its pros and cons.
Taking into consideration the pricing, accessibility, and content, Amazon Prime seems to be slightly better than the rest, in my opinion. It caters more to the Indian audience than Netflix but also provides a lot of international movies and shows than some other platforms. A close competitor would be Disney+Hotstar with a lot of original content as well as International content, not to mention live sports, a feature missing from both Netflix and Amazon. Another added boost is the recent Disney+ addition which adds a lot of popular Disney movies as well as movies of the famed MCU to their already vast library.

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