India’s OTT showdown: Regional titans challenge global giants

Recently, Meghalaya introduced an Over-the-Top (OTT) platform designed to support and showcase the state's creative talent to promote local culture, languages, and artistic expression. “Unlike global streaming giants, this platform is deeply embedded not only in the promotion of content but also, resultantly, the promotion of Meghalaya’s language, culture and identity. This distinctive approach enables Hello Meghalaya to resonate with the community in a way other platforms may not,” Bah Paul Lyngdoh, Minister of Department of Tourism and Department of Arts & Culture, Government of Meghalaya, told Storyboard18.

There is also hoichoi, a subscription-based OTT platform focused on Bengali content launched in 2017 which continues to grow, with a 50 percent year-over-year increase in the current year.

Regional OTT content volumes exceeded Hindi language content in 2023 for the first time. YouTube has beaten traditional TV in terms of audience reach in some Hindi-speaking states of North India and the North East, as per the FICCI EY report on the media and entertainment industry, as per the FICCI EY report on the media and entertainment industry.

YouTube is the largest OTT player in India with around 467 million users and a reach of 90 percent. It has overtaken traditional TV in reach in Bihar, Jharkhand and north-east. In Uttar Pradesh, Uttarakhand and Delhi, TV and YouTube are at par, the report revealed.

YouTube viewership has increased because of the increase in high quality and niche content on OTT platforms. Also, connected TV is being rapidly adopted across India.

In Maharashtra, Andhra Pradesh, Tamil Nadu and Karnataka, TV still remains the dominant choice. As per the report, YouTube has 61 percent of TV’s reach across India.

The share of regional language OTT titles increased from 47% in 2021 to 52% in 2023. Content has started to travel across language barriers; industry discussions indicate that between 20% and 50% of consumers now consume content in more than one language using sub-titles and dubbed versions OTT platforms desirous of a national reach will require focusing on at least eight to nine languages, and each language will require at least eight to ten pieces of content across film and episodic, as per the report.

Of the titles analyzed, over 60% belonged to the drama, crime or action genres. The number of reality shows was lower, but they pulled in very large audiences, and we expect these to increase in 2024. A surge in demand for mythologies and documentaries was also noted in 2023.

No doubt, the growth of regional OTT platforms highlights the increasing demand for localised content, posing a potential challenge to global giants.

The global platforms declined to comment on the rise of homegrown regional OTT platforms and its perceived threat towards them.

Regional OTTs: Revenue opportunity for India?

Raghav Anand, Partner, EY-Parthenon for M&E points out that the smart TV universe, which is 22 million now and projected to be 70-80 million in the next three years, leading to the Internet TV & OTT industry growth. While addressing how regional content can contribute to revenues globally, he said, “Sometimes OTTs don't like to be called regional; Punjabi OTTs have primary markets like Canada and the US, Telugu OTTs’ primary market is Southeastern USA."

Anand added, “Global OTTs have differentiated strategy, some follow a trend of picking a homogenous user base and trying to create that homogenous layer among 100 countries. They are just picking 1 percent of the population.”

"Some others like to go slightly deeper, they penetrated the first 20-30 million, there is a lot of gap, there are about 550 million plus video users in the country, there is a huge gap in the 200-300 million need to get served, that's where regional content and OTT comes in," he further said.

Dhruv Aggarwal, Partner at Bain & Company, believes that partnerships with other regional players will be crucial for scaling and enhancing offerings, building local scale, and innovating revenue models like combining subscription and advertising, especially premium options, to scale OTT platforms in the price-sensitive Indian market. While global players are excelling in advertising, regional players need to differentiate themselves by attracting dedicated content. Europe has shown that even with global content originating in the US, youth still appreciate regional content.

Regarding pricing strategies, Aggarwal emphasized the importance of sports content. Unbundling can help lower prices, catering to the price-sensitive Indian market.

The rising affordability of smart TVs and smartphones, driven by the young and growing population, will continue to accelerate as a macro change. However, the phase-out of Google cookies will complicate data privacy for OTT players, he says.

Aggarwal believes that high-quality regional content can travel across markets. Examples like Korea and Spain demonstrate the success of regional content on a national scale. He anticipates similar trends emerging from the Indian market.

If you look at the regional landscape, mainstream OTTs differentiate themselves primarily through their content. Viewers are drawn to Malayalam or Telugu series because they offer unique and distinctive content. These OTT platforms leverage this by offering pricing points that are optimised for regional audiences," says Chandrashekhar Mantha, Partner, Media & Entertainment Sector Leader, Deloitte India.

“The third aspect to consider is collaboration. How can these platforms create an ecosystem to maximise their reach? Can they enhance their user experience? Amazon Prime and Netflix are way ahead in terms of personalisation. If regional OTTs can catch up in this area, they have a significant advantage,” he says.

“Bundling is another strategy to maximise reach. By combining content with other services or products, these platforms can offer more value to their subscribers,” Mantha adds.

The Southern onslaught

While addressing the role of regional content, especially Southern India’s content in ZEE5’s growth, Manish Kalra, CBO, ZEE5, says, “ZEE5 has focused on regional content which still remains steadfast.” He said, “Not only have the titles performed exceptionally well, but they’ve also won critical acclaim and recognition. For example, Ayali won accolades from the Tamil Nadu government last year, he says.

‘Manorathangal,’ a series that heralds a new epoch in Malayalam cinema, premiered on August 15th on the platform. “We have also been strengthening our existing markets with the upcoming launch of the Bangla crime thriller 'Kaantay Kaantay.' This commitment has resulted in over 50 percent of consumption on the platform stemming from regional languages,” says Kalra.

Then there is SonyLIV, ZEE5’s competitor who also seems to be betting on Southern content to increase market penetration. Saugata Mukherjee of SonyLIV, says, "We have just started our regional journey in terms of first originals. We have been buying films in three languages specifically: Malayalam, Telugu, and Tamil. We have acquired films like 'Maanadu.'”

SonyLIV’s first film called Trisha was launched in Telugu.

There is a great ecosystem of makers and storytellers in the South. Many South Indian films are performing better than regular Hindi films, says Mukherjee.

“Our original content is behind the paywall. We started the year with 'MasterChef' in Tamil and Telugu, the first time we were bringing unscripted shows in these languages. We will have more focus on Southern states and aim to be as local as possible. We want our advertisers to see that our shows are not just another Hindi show but unique and hyper-local,” he added.

Talking about SonyLIV’s strategy to attract local advertisers, he says, “Many of our shows' feature makers, actors, or casts are from different languages. We want to foster this osmosis of talent both behind and in front of the camera, giving the greater Indian audience a chance to watch these storytellers on our platform."