Mumbai: Pay TV subscription revenue is expected to reach $7.6 billion by 2026 over $6.4 billion in 2021, stated Media Partners Asia in its latest report on India’s online video market, which also highlights the increasing market share of Direct-to-home (DTH) even as cable TV remains in structural decline.
There are 127 million pay TV subscribers in India and DTH has been winning share from cable TV since 2019. While DTH grew its subscriber share from 42 per cent in 2019 to 47 per cent in 2021, the share of cable TV declined from 56 per cent to 52 per cent in the same period.
According to the report, there will be one billion video screens in India by the end of 2024. There will be 47 million FTA households and 121 million pay TV homes. As many as 13 million homes will have hybrid set-top-boxes, 744 million users will have 4G connections and 155 million users will have 5G connections. In the long run pay TV homes will decline while FTA homes will continue to grow, the report indicated.
By 2026, two-third of Indians will have access to high-speed mobile broadband reaching 899 million subscribers, out of which 34 million homes will be serviced by fibre, and three million homes will have wireline (digital subscriber line) connections. The report estimates that ~90 per cent of fixed broadband homes will be serviced through fibre.
In terms of revenues, the video market scale will grow to reach $18 billion in 2026 over $11.6 billion in 2021. Pay TV subscription revenues may reach 7.6 billion, pay TV advertising revenues at $6.1 billion, OTT advertising-video-on-demand (AVOD) to reach $2.8 billion and OTT subscription-video-on-demand to reach $1.8 billion.
D2C SVOD subscribers to reach 193 million by 2026
Despite content supply bottlenecks, India’s OTT SVOD subscriptions continue to grow at a robust rate. This year OTT subscribers are expected to grow by 1.6 times over the previous year to reach 88.7 million. Most of these subscribers are expected to come through Disney+ Hotstar in Q4. As per the MPA’s estimate, Disney+ Hotstar subscribers is likely to reach 46 million, Prime Video to reach 21.8 million and Netflix to reach 5.5 million at the end of the year. These platforms will continue to account for 83 per cent of total direct-to-consumer subscribers in India.
The OTT industry is also expected to invest $1 billion in content in 2021, according to the report. Their share of acquired and local content is 30 per cent and is expected to grow to 40-45 per cent in the near future. New D2C SVOD entrants are going to enter the market by 2022 including services from HBO and Comcast.
The content strategy of the leading OTT players is diverse and has led to subscriber growth. For Disney+ Hotstar, the combination of sports and local originals has been increasing subscriber growth. It hiked its base plan by 25 per cent “which is justified given the value of its upcoming slate of premium sport and local original content”, said the company.
Disney+ Hotstar, which is currently at the lower end of ARPUs (<$2), will see its pricing power improve after 2022, according to the report. Prime Video has benefitted from its regional content push and Netflix has invested heavily in original content with 41 original releases in 2021.
In 2022, the Indian Premier League (IPL) media rights will be up for grabs once again with TV and digital rights being sold separately. The report estimates that top bidders will include Disney, Amazon, Facebook, Jio and Sony.
