OTT players will soon do to multiplexes what multiplexes did to VCR / VCP / VCD players during the early 2000s, according to SBI Research’s assessment.
It expects OTTs to become a Rs 12,000 crore market by 2023, a big jump from Rs 2,590 crore in 2018. This increase reflects a compound annual growth of 36%.
The transition to OTTs became particularly intense after the pandemic led to the closure of cinemas for a considerable period of time.
According to SBI Research, the over-the-top or OTT market is expected to reach Rs 11,944 crore by 2023, compared to Rs 2,590 crore in 2018.
It may be recalled that the VCR / VCP / DVD industry, which had a boom in the 1980s, suddenly fell into oblivion as multiplexes quickly rose to prominence in urban areas of India around the beginning of the years. 2000.
So far, OTT has snatched 7-9% of the entertainment industry’s share and revenue. The industry, which has over 40 players offering original content in all languages, is growing rapidly and steadily.
There are currently more than 45 crore of OTT subscribers in India today and this number is expected to hit 50 crore by the end of 2023, PTI said, said Soumya Kanti Ghosh, chief economic adviser of the SBI group.
Affordable high-speed mobile internet, doubling of internet users, increased adoption of digital payments and discounts have all combined to fuel the captivating growth of the OTT industry in India.
The rise in OTTs should hurt cinema profits as over 50% of subscribers use OTTs more than 5 hours a month.
Prices offered in India by global players such as Disney + Hotstar (14 crore subscribers), Amazon Prime Video (6 crore subscribers), Netflix (4 crore), Zee5 (3.7 crore) and Sonyliv (2.5 crore) they are 70-90 percent cheaper than in the United States.
The OTT space is also seeing a number of local and regional players with players like Sonyliv Voot, Zee5, AltBalaji, Hoichoi etc. That meet the regional demand.
Additionally, major film studios have realized that creating streaming series and movies is far more profitable than traditional cinema, especially if they build their own streaming platforms.
In the 1980s, an exponential increase in video cassette recorders / players (VCRs / VCPs) challenged the viewing modes and patterns of established cinemas. But the rise of multiplexes in the early 2000s in subways and big cities effectively killed the DVD and single screen industry. And the onslaught of OTT platforms is set to multiplex what they did to DVD markets in the early 2000s, the report notes.
Inputs from PTI