FICCI Frames 2023- Digital Media: What is the right revenue model?

FICCI Frames 2023- Digital Media: What is the right revenue model?

The event is being held at Westin, Powai, Mumbai.

Mumbai: FICCI Frames 2023, the mega event on the Indian media and entertainment industry flagged off on 3 May at Westin, Powai, Mumbai.

Despite India being a price-sensitive market, consumers demand quality content. There is a lot of debate on the right revenue model for OTTs – one that aligns with their target audience while balancing business goals. The panel will deliberate on the viability of existing business models available for OTTs – AVOD, SVOD, hybrid, and aggregation – and the prospects of new ones.

Chrome Data Analytics and Media founder & CEO Pankaj Krishna opened the session to all the panelists and questioned, “Customer acquisition is the killer in the OTT business and the costs are huge so is it SVOD, AVOD or hybrid etc, what models work in your experience.”

To which Arré co-founder Ajay Chacko answered, “ If you look at what had happened in the last seven to eight years since the boom in OTT in India and digital media seen overall, the business models have changed two or three times, it started with this all SVOD and AVOD thing. So if you look in the mirror and say as a player, at a cross section of the industry, what is the revenue model, they will say its advertising or subscription. But if you look at the business models, that’s where the real disruption has happened.”

Playbox TV Founder & CEO Aamir Mulani shared, “What I really feel as India is getting OTT every two months, three OTTs are getting launched. Everybody is fighting for the same consumer, but everybody has a certain set of content requirements. I have also seen some players spending Rs 2000 to acquire a Rs 500 customer because the price of the content is so low that you can't sustain on that model. So as the number of players are increasing, the cost of digital advertising is also going up.”

Krishna asked Warner Bros Discovery APAC director, retention engagement & growth strategy, DTC marketing Praveen Chaudhary, “ There is a lot of India commissioned content that we see in your platform that seems to be great production. Is it really viable and are you getting the numbers from that kind of production.”

Chaudhary said, “Yes there are short term challenges that all OTT players face, but I think things have improved dramatically in the last two to three years. There have been some industry level improvements for e.g. every Indian now has UPI at their fingertips so they can make the transactions more easily. And we can already have reached a stage where we can see the business model becoming profitable on an incremental basis.”

Lions Gate executive VP Amit Dhanuka commented, “ I think it is a little bit more nuanced. I think there is a hybrid model that's there in the market with VOD platforms. There's a subscription model too. Within the subscription model it evolved into aggregation models because eventually you want to go where the customer is consuming content.”

Krishna further questioned aha vice president & head- non subscription revenue Nitin Burman about his platform’s content and told, “So when we started aha, we also wanted to start for the entire South market and when you look at all the national platforms, when they release any content of South, its not Telugu, Tamil, Malayalam and Kannada. But when you actually deep dive, these are four different European countries. Telugu for us is a 100 million user base, and from that we already have 30 million app downloads, three million paid subscribers on our app which actually raise eyes on all big platforms that there is one small regional player who came from nowhere and is suddenly making waves.”

Balaji Telefilms Ex Group CEO Nachiket Pantvaidya shared his view, “The biggest investment in content in digital today, which is the IPL, is being given away free. So my view is if you want your business to upscale you would go for advertising.”

Pratilipi business head audio & studio Ambesh Tiwari concluded by saying, “The way brands are reaching consumers have changed today. If you look at what is the biggest disruption in global digital, Google share has been dramatically eaten up by Amazon, because that's the most effective form of advertising.”