OTT entertainment platforms see growing adoption by ‘Bharat’ users

Chennai: Over the top (OTT) video platforms are finding favor beyond the metros and see growing adoption from audiences in tier-2, 3 cities and towns.

A majority (60%) of users of OTT platforms come from non-metros today and the growth rate is expected to outpace urban users in two years, industry officials said.

An analysis by RedSeer Consulting estimates MAUs (monthly active users) for the OTT video sector to grow around 80% from 170 million in 2019 to 300 million in 2022 with tier 2/3 and rural consumption reaching 80% share (vs 70% estimated currently).

OTT platforms say they are ramping up on non-English content with a local flavor for the small-town user, who enjoys affordable smartphones and growing internet penetration.

While monetizing services from this segment remains a concern, most players are counting on the freemium model to get users hooked.

“Connectivity and access to online payments may be an issue in rural areas, but users in Tier-1 and Tier-2 cities have access to both today,” Hanish Bhatia, senior analyst, Counterpoint Research, said.

KPMG noted that 40%-45% of content consumed across OTT platforms is from regional libraries, and cost to create such content is approximately 30%-40% lower than mainstream Hindi or English. Karan Bedi, CEO, MX Player, says audiences in tier 2 and 3 markets are most underserved when it comes to quality content online, but have the potential to soon become “OTT-first”. “Depending on nature of content and the dynamics of being a weekday or holiday, we mostly see 40-45% of users coming in from metros while maximum traction comes in from hinterlands,” he said.

ALTBalaji has been partnering with telcos for bundled offerings- a model that helps bring business from tier-2+ regions.

“We have always believed that we want to be a mass India player…we have created 42 shows of original content in Hindi, out of which three have been in Bhojpuri, Tamil and Bengali,” Nachiket Pantvaidya, CEO, ALTBalaji, said.

Streaming service Viu, in an analysis of its Telugu segment, found that almost 60% viewership came from Nellore, Vijayawada, Guntur and other cities outside major hubs. “OTT adoption is no more an elitist phenomena; user growth is following growth of mobile internet,” Vishal Maheshwari, country head, Viu India, said. Citing data from a recent third-party study, Eros Digital says close to 59% of its users are 25-39 year olds from tier II/III cities. The OTT platform sees immense opportunities in partnering with brands that focus on reviving lifestyle of small-town customers.

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