OTT: Paying OTT users in India could be fewer than 10%: Report

Video streaming or over-the-top (OTT) platforms have shown a strong traction in consumer growth over the past few years. However, the proportion of paid subscribers has remained in single digits reflecting the impact of sharing of account passwords and content piracy. A recent sector report by EY points out that less than 10% of the total 50.3 crore Indian OTT consumers actually pay for these services.

“The number of OTT consumers is probably much higher than the number of subscriptions; like how a newspaper is consumed by several people in a family or around a tea stall in smaller towns,” said Ashish Pherwani, leader, media & entertainment sector, EY in the report.

Danish Khan, EVP and business head, SonyLIV and SET at Sony Pictures Networks India, feels that there is a lot of potential for growth in paid subscribers.

“One has to look at both – the direct-to-consumer (D2C) subscriptions, which are around 20-25 million at present, as well as a large B2B segment, which is offered as bundled service along with telecom or other bundled offers.”

He added that the B2B has grown significantly and is around 40-45 million.

A low percentage of paid subscribers can be attributed to sharing of passwords with family and friends. The EY report estimates that on average a paid subscription was used by 3-3.5 people in 2021. “Our estimate of 40 million OTT households could have a potential reach of up to 120-140 million people, or even more,” mentioned the report.

Khan of SonyLIV counts piracy as the biggest challenge for the OTT platforms. “As an industry we must come together and find a solution since piracy is hurting the entire industry. We are not too worried about password sharing, as it helps in increasing sampling and will increase our base in near future.” Khan added that concurrency and number of device-based pricing will help platforms to convert the password sharing users to become direct subscribers.

According to Ameya Naik, founder, Fantasy Events, an event management company, piracy is not just restricted to films or songs in India “The hunger for OTT content is rising. This has alerted people who are into creating pirated versions of OTT content given the increasing market size,” Naik said. He added that the advent of applications through which viewers can access OTT content have impacted subscriptions thereby prompting streaming platforms to consider introducing advertisements in their offerings in a bid to seek a viable source of revenues.