Magazine : 
The True Age of OTT is Here & It’s Just the Beginning
All the industry pundits prediction fell flat when the pandemic arrived. Their claim of the age of on-demand video streaming already here saw a new high when we were all locked inside our home. OTT (over-the-top) services truly revolutionized the way we consume content online. Not just our medium of consumption but even the quality & type of content we consume have changed drastically since the pandemic. We have also moved beyond TV watching to consuming content on our smartphones, ensuring the content we watch is more personalized.
No wonder, the Indian OTT market is expected to reach $5 billion in size by 2023. I spoke to Rohit Chadda, CEO, ZEE Digital to know more about this changing trend, the future of OTT, and where India stands in the global OTT market. We also discussed about how the digital content censorship will impact the future of OTT. And I also have tried to bring to the personal side of Rohit.
Below is the excerpt of the interview.
Please explain your role at ZEE Digital. What changes did you notice in the digital entertainment segment in the past few months?
I currently manage the digital publishing portfolio of the group, which includes three companies entertainment, media corporation and the DNA. The entire digital publishing portfolio includes 20 brands in 12 languages.
We all know that the world went into lockdown and people were homebound. This drastically increased content consumption, which saw a rapid spike in demand. Initially this spike was distributed between television and digital platforms, however television lost the war much easily to the digital platforms because they had the constraint of no new content coming in as the shooting were halted.
This means digital consumption grew multi-fold, more users coming in, time spent on the platform increasing and much more. In fact, we saw the industry launching epapers and the subscription-based OTT providers witnessed substantial growth in the paid subscription users who earlier were free content consumers. It was the love of content and the variety that garnered so much of love from across demography. The pandemic indeed turned out to be a blessing in disguise for the OTT sector.
If we talk about the trend in the OTT segment, it was news that won the crown. However, the initial three months were hard on the industry. Why? The lockdown almost locked any ad revenue from coming in. But once the IPL started, everything was back in action with advertisers. Content consumption and the markets opened up, businesses were back to usual. I think in most cases, and for most industries, the past few months were difficult as the scenarios were different and businesses were going through a rough phase. However, from the business perspective, we did extremely well and now we are life time high in terms of users, revenue and others.
Trends in 2021, and how is the industry preparing for it?
What the pandemic has done is that it has propelled us four-five years in the future. This is the second life changing event only in the last five years. The first one being demonetization, which fast forwarded the digital payments adoption at least couple of years. Ironically I was at the cusp of digital payments when that happened as I had a payments company at that time. I think this is the second life changing event that we saw in the short time.
We see behavioural change, given the long duration of the pandemic and people sitting at home, keeping social distancing and avoiding going out; hence this has now induced behavioral change that people now have started warming up to digital, both in terms of commerce as well on content.
Most recently I have observed that few print players have either shutdown their city supplement or have made it weekly. This shows that digital is here to stay as people are now hooked to consuming content online. Lot have been done by some of the competition; the more premium OTTs are inducing trial by giving free days and getting people hooked on to it. We see a lot of players launching mobile only tags. This is something that will help them in expanding in tier1 and tier2 markets. Historically, you would have seen subscription coming in mostly from the larger metros, but now players are experiencing mobile only tags from users who consume content primarily on the mobile and come from small towns & cities.
Another trend making inroad is the use of various modes of consuming content on OTT. Connected devices is one of them. On the other hand, the demography is also changing rapidly. While we never would have assumed the elder/older generation to shift from DTH to OTT platforms, the pandemic did the magic here too. They not just consume content on OTT but are largely using connected devices to binge watch. In fact, if I have to speak about digital, we ourselves have launched the ZEE news OTT app during the lockdown on IoT and Android TV and saw a very good attraction. We also launched the Wion OTT app on multiple platforms including Samsung, Oppo, LG and all the major OTT applications. We except to see that growth coming in from OTT in the coming year as well.
That’s an excellent move digital is experiencing. But what about the challenges in 2021? Also we hear about censorship of digital content. What is your thought on this?
The growth in the OTT space could be one of the reasons why the government is now talking about censoring the content. Earlier there were only a very narrow set of audiences watching premium OTT content, now you see a much wider audiences in terms of age, demography, location and others. So the one change that will be prominent in the coming days is ‘restrictive content’. But how restrictive? That we will have to wait and keep an eye on the policies that are going to come in.
The next challenge that we foresee is in terms of growing in tier 1 and 2 cities. It could be due to the availability of devices, and poor internet, bandwidth, and more. For instance, if we look at the lower tier cities, where people are slowly moving to LEDs & LCDs, however a lot of these are not connected devices. Also, such cities face a lot of bandwidth issue that contributes towards slower growth. Hopefully if this problem is resolved, the growth of digital content will be unprecedented. Otherwise we are on the right track, including our payment methods in terms of digital payments, which has made payments a breeze and hence subscription is also super easy.
However, here too we have hit a hump in the form of poor recurring payments. Any subscription service can successfully hold on to the consumer only if they have recurring payments. But unfortunately, recurring payments are mostly available only on credit cards, which still has a very low penetration in India. On the other hand, very few debit cards have recurring payments option and for a long time, we have been waiting for UPI to bring in recurring payments. Now we hear that this is going to be a reality and when so, its deep penetration will help us solve this subscription problem.
Is the OTT consumption pattern different in India and abroad? What changes do you notice in the Indian consumption pattern?
Content is unique to every individual/audience. Everyone has a certain kind of content preference. Content is one thing that cannot fit one size all. Hence content strategy has to be built by every country or should be region specific. A lot of local content production and acquisition also help in popularizing the content as well as the platform. Like I said, content is a different ball game in every country so you have to fall for it for every country. Obviously that’s going to be your universal winners that are liked, enjoyed and accepted across the world but overall when you go deep down when creating a content strategy, it has to be specifically done for each country.
When it comes to content consumption, we see a huge variation in terms of which country spent how much time on mobile, desktop, and OTTs. When you compare India with worldwide, globally we see maximum consumption coming in from entertainment whereas in India, news consumption tops the chart. India is also the second largest consumer of online news right behind China. Though the difference percentage is negligible, but it is worth noticing.
However, when it comes to consumption pattern and average minute spent by a visitor, surprisingly, we see lot of European countries spending more time than India. Some of the Scandinavian countries actually spent much more time per visitor online compared to India. And it is not surprising that in India and China, almost 90 percent of the content consumption happens on mobile as the two countries top the mobile subscription chart.
Let’s talk more about censorship that government introduced recently for OTT channels. How is it going to impact the content and consumption pattern?
There was this particular set of audiences that enjoyed content without censorship online. However, I don’t think that this is going to impact overall growth of the industries drastically especially because a lot is to do with how strict the censorship norms are. Those I think are yet to be seen including the policies around that; but my assumption is that it will be not as strict as television and hence, I don’t expect too much of roadblock for OTT platforms. However, there are particular set of audiences who might be disappointed and might fall out or possibly start using technology to evade geo location tracking. However, this is not going to stop the growth and the adoption that we have now started seeing on the OTT base.
What do you think about security of the data, like payments and other related information?
Security is top notch, that’s something that all technology platforms are very concerned about. There are PCI DSS norms and anybody who takes your card details has to be PCI DSS certified.
In terms of user location and other data, obviously there is a lot of personalization and other things that content player do basis the user’s data and there again, the user has the option to opt out. Hence to be rest assured, all the larger platforms take care of the data and security, which are extremely important and use all the technology to actually safeguard that.
Let’s talk about the personal front.
I am a sporty guy, I love sports. I love to indulge in sports rather than watching. Pre-COVID, I used to have weekly cricket match.
I like staying fit, and even followed fitness regime. After the lockdown, I actually did a full 90-day workout program at home. It helps me to de-stress and get charged after a long day.
I am also a movie buff. I watch a movie before I sleep as late as it may be, even if my work finishes at 2 AM.
Being a tech guy, I love gadgets, both in terms of phone and other stuffs. I am an Apple fan, I own most products Apple. I doubt that Apple would have made any product line that I don’t own. I love to buy new gadgets as and when they are launched, just to experience them.
I love cars as well. When pocket allows, I love to indulge in luxury cars which I can.
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