Video streaming in India is seeing many firsts in COVID-19 times. Last year, after cinema halls shut down during the pandemic, over-the-top (OTT) platforms introduced the concept of direct-to-digital releases by getting the rights for films that were originally meant for theatrical release.
Now, an OTT is trying the direct-to-digital concept for TV content.
Voot, Viacom18’s video-on-demand platform, said on Friday it will launch the 15th season of Bigg Boss on the OTT platform six weeks before it starts airing the reality show on the Colors TV channel.
Some experts call the move a radical change in terms of making content more widely available, enhancing the visibility of OTT platforms and monetisation potential.
“Bigg Boss is one of the largest franchises in India and this must be read as a meaningful shift in the economics and viability of straight-to-OTT,” said Utkarsh Sinha, managing director of Bexley Advisors. “One can be confident that this must mean greater returns for the producers as this is decidedly not a shift made out of compulsion, as was the case with direct-to-OTT earlier.”
“The show has a huge fan following that’s skewed towards the urban youth (15-34 years in the top 10 cities), which is also the core profile of the OTT audience,” said Shailesh Kapoor, CEO of Ormax Media, a media consulting firm. “By doing a staggered OTT and TV launch, Viacom has managed to increase the show’s brand and monetisation potential significantly.”
Filmmaker and producer Akshay Bardapurkar said that this will happen more often and expects more tentpole properties to see a direct-to-digital launch.
“It is a welcome change. All advertisers are focusing their money on OTT and social media platforms because TV is losing its audience,” he said.
It is estimated that as many as 10 million Indians shifted to OTT platforms last year.
Television broadcasters in India are facing a tough time, with pay TV revenue including subscription and advertising declining 10 percent year-on-year to $8.9 billion in 2020, according to a Media Partners Asia (MPA) report.
So, how will this move by Voot impact the TV space?
Ad revenue impact
According to Karan Taurani, senior vice president at Elara Capital, all TV channels won’t be affected but streaming Bigg Boss six weeks before airing it on TV will cut into the show’s advertising revenue. Subscription revenue won’t be affected because the channel has other content for viewers, he said.
“This is happening to get more eyeballs in the OTT segment. But there are challenges in terms of monetisation. So, TV if you see, the kind of pricing they get for a 10-second slot is massive. So, you might be able to get the eyeballs, but revenue will be a challenge,” said Taurani.
He said the dynamics are not quite the same as the Indian Premier League cricket tournament, which is telecast on Star Sports and streamed simultaneously on Disney+ Hotstar.
“On Star, the content goes simultaneously and that is why the pricing doesn’t get impacted. Even today, an IPL 10-second slot is about Rs 13 lakh despite being showcased on Disney+ Hotstar. But that is because it is a different kind of content, which is consumed live. In the case of Bigg Boss, if the show is on TV first then people might want to catch up on digital as per their convenience. If it is showcased on digital, then it hampers the TV ad revenue,” Taurani said.
A 10-second advertising slot on Bigg Boss on TV costs a little more than on Kaun Banega Crorepati, where it commands Rs 6-8 lakh.
Regardless of whether ad revenue is affected, Sinha of Bexley Advisors said that “Bigg Boss on OTT before broadcast may be one of the most significant points of inflection for the shift towards an OTT-first consumption landscape.”
More Indians are subscribing to OTTs
The signs of a shift to OTT are already visible.
An EY report points out that the number of OTT subscribers increased to 29 million in 2020 from 11 million in 2019. In addition, subscriptions to various streaming platforms grew to 53 million from 21 million.
Voot Select, which was launched in March last year, onboarded a million subscribers in less than a year.
According to Kapoor of Ormax Media, streaming Bigg Boss first “will definitely give Voot a boost in their subscriptions because Bigg Boss is as tentpole a property as they get.”
However, Taurani pointed out content is available free of cost on OTT platforms in partnership with each other.
“So, it all boils down to how many new subscribers you get to pay afresh,” Taurani said. “It happened with the movie Radhe as well. You saw big spike in terms of eyeballs, but the actual number of subscribers who actually paid that Rs 500 for the movie was 300,000.”
Whether Voot’s move becomes a gamechanger in the OTT space or not, Sinha said it won’t be surprising if others, too, adopt this model.
“OTT subscribers represent a much richer revenue source as there are fewer entities to share in the revenue pie, unlike with traditional broadcasting,” Sinha said. “If the subscriber base is large enough, OTT is a no-brainer for the channels as it helps cut out the middleware and lets them monetise the consumer experience fully.”
Disclaimer: Viacom18 Media Pvt. Ltd. is a joint venture between Network18 and ViacomCBS. Moneycontrol is a part of the Network18 group, which is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.