With over-the-top (OTT) video and data consumption witnessing a steep surge in India led by Jio Platforms that has committed to launch an India-built 5G network in the next 12 to 18 months, the video-on-demand space is set for explosive growth, according to a new report.
According to global market research firm PwC's â€˜Global Entertainment & Media Outlook 2020-2024,' the Indian E&M (Entertainment & Media) industry is expected to grow at 10.1% CAGR to reach $55 billion by 2024.
"India is the ninth-largest consumer market for E&M and is growing rapidly. Looking solely at consumer revenues, India, the fifth-largest economy in the world, is in clear first place with an 8.8 per cent CAGR, helped by the fact that print revenues are still rising in many regions of the country," the report mentioned.
When it comes to the subscription-based content streaming market, OTT revenue in India is likely to be the sixth largest in the world in 2024.
"In India, explosive growth in OTT subscriptions has spurred production of short low-budget films made specifically for OTT platforms, sometimes repurposed from long-form movies whose production was halted," the PwC report mentioned.
India's vibrant market of 40 OTT providers includes regional players targeting the country's large local-language populations.
"Some OTT players aimed at local village audiences charge one rupee a day for access to content. Disney+, offered in India via Disney's local subsidiary Hotstar, offers a range of pricing levels from basic to premium," the findings showed.
In June 2020, in the midst of the pandemic, Indian regulators gave the go-ahead to Facebook's $5.7 billion investment for a 9.99% stake in Reliance's Jio Platforms.
"Jio, India's largest telecoms network, operates an expanding suite of entertainment and media apps and digital services. Within a month, Google invested $4.5 billion to pick up a 7.7 per cent stake in the company," the report said.
In the 5G era, on-the-go consumers using high-speed mobile data will access greater quantities of content, games and services.
Inching closer to its 5G rollout, Reliance Jio, which counts 400 million subscribers on its 4G network in India, this week achieved a 1000Mbps throughput milestone for its first round of 5G trials in partnership with US wireless-communication chip giant Qualcomm Inc.
"The revenue opportunities opened up by 5G reach far beyond wireless data and communications themselves, encompassing markets such as gaming, entertainment, music and OTT video," the report added.
What's more, 5G's massive network capacity is likely to continue reducing the cost of mobile data, removing the principal constraint for consumer activities such as mobile video consumption over cellular networks.
In China, many content owners have renegotiated their arrangements with cinemas to switch their movies to OTT streaming platforms and a similar phenomenon can be seen in India.