Mumbai: aha promoter Allu Arvind and CEO Ajit Thakur announced aha’s expansion plans in Malayalam and Kannada in the next three years.
“Our next growth plan is to expand into new languages and genres, we are committed to infusing Rs 1000 crores”, aha promoter Allu Arvind made an announcement at a media round table yesterday.
aha CEO Ajit Thakur joined him, saying, “We reached 1 million subscribers in our first year and that was not planned. We were celebrating our first birthday at that time, and we had 1.8 million subscribers by the second year. And this year, as we complete our third year we have 2.5 million subscribers. From the first to the third year, the number increased from 1 million to 2.5 million. Growth has slowed this year, but we grew 40 per cent more compared to last year. ”
Thakur explained how aha is aiming for 6 million subscribers by the year 2025 with 600 million views. aha also believes there is an opportunity to play dual SVoD and AVoD strategies. Currently, aha has 12 million Monthly Active Users (MAUs) with a 55 percent re-subscription rate for Telugu.
Arvind believes demand for regional content is at its peak but it is significantly underserved by OTT in India. “We want to serve all the South Indian languages but when you open the app, the very unique quality of the aha app is that you will find only that language you want, and that will be served to you, and now we want to explore languages like Malayalam and Kannada as well,” added Arvind.
“Today, three years later, we are successful in Telugu and we are growing fast in Tamil, I believe the time has come for us to grow further into more languages. I am happy to say that over the next three years, we have a solid plan of growth with expansion into new languages and genres; and to that end, we are committed to infusing Rs 1000 crores,” added Arvind.
About the hybrid model, Thakur said, “Primarily we are SVoD and will continue to be for over the next three to five years. The idea was not to dish out ads to paying subscribers but monetise through the unique proposition we have. So we started to hit a very good number in terms of non-subscription revenue this year, which is $ 4 million. And 80 per cent of that is not coming through ads but it is coming through brand solutions. So we are serving ads to people who are free users, amongst the things that we are adding to the Telugu offering as we get to the short form, we want to add live commerce to that content.”
He further added, “AVoD is here to stay but in the foreseeable future sign of a good platform is if you can demand subscription revenue”
Thakur informed that actor Allu Arjun, one of the promoters, is very actively involved as a board member of aha. “He is a huge fan of brand marketing and creating brands. He's been very actively involved in helping with everything from the logo design to other things including the naming of the app, when we were in the testing stage, his contribution behind the scenes has been significant,” said Thakur.
The average age of aha’s consumers is about 24. The audience from age 20 to 30 is the primary target. A large part of its consumer base is between 20 to 45. It is about 65 per cent men now, when we started it was 75 per cent.
Today, aha has 2000+ hours of content, including 350+ hours of exclusive and original content, and 32 million app downloads. It is best known for shows like Unstoppable with NBK and Telugu Indian Idol.
With the addition of Telugu and Tamil, the overseas network has expanded to the United States, United Kingdom, and Australia, as well as Southeast Asia, which includes Malaysia, Myanmar, Sri Lanka, and Singapore. According to recent industry surveys, aha is already the most popular Telugu OTT service.
Indian Television caught up with aha CEO Ajit Thakur who shed light on content and the business strategy.
Edited excerpts
On Rs 1000 crore investment
We want to grow aggressively, primarily we have to invest in the current languages Telugu and Tamil which are doing well, and we are investing in new languages as well. This is why the need to raise a much higher corpus to expand from Telugu and Tamil to other languages.
The time is now for us to get into Malayalam and Kannada. So what we are saying is the promoters will infuse 50 per cent and the other 50 per cent we will raise from the market so that we can get to these newer languages faster without losing focus on our current leadership. There's no point in going and producing films, they'll get produced for theatre anyway and then we can compete with others to buy the smaller films. Nobody's taking the risk. So there's a large opportunity for directors and actors available. We will go and invest upfront.
On aggregator apps trend
We want to stay away from it as long as possible, because there we don't own the customer.
We are content creators if we make our content available to everyone. So, what is the benefit of a platform? We want to stay in the B2C model because we have the advantage of having the platform and being able to control the narrative and the customer. But in the future if we have to do it at some point, then we will select one big aggregator like Jio, because their phones have reached the last mile customer in rural India.
On Bharat vs India
We are focused on Bharat; everyone is competing in India, but nobody is focussing on Bharat. We are 100 per cent local, and the definition of local must be Bharat. They are watching all kinds of content, be it Korean, Spanish, and everything but it's dubbed in their language. The consumer in rural areas is watching content for six – eight hours per day. They have a lot more time than we do. But they are watching a lot of content on older and less expensive phones, the quality is not great, but that's fine.
On pan India content
Pan-India stories are here to stay, with South Indian content taking the lead, but there's no reason why Hindi films can't cross over. I mentioned that OTT has fueled that even more because there is nothing like which language you're watching it in because all content is being dubbed and subtitled in all languages. The truth is that a good story in any language will work and a bad story will not work.
On the challenges
The most difficult aspect was getting the content to scale properly. There are few writers, and we were the leaders in Telugu in terms of producing a whole generation of writers for OTT through film and television. Creating new content was difficult, as was raising awareness among subscribers, and the fourth challenge was competing for content acquisition. We now face the fifth challenge, which is hiring people.
On distribution
We want to own the customer. So far, we've done it with a couple of ISPs where the subscribers are still with aha. Then distribution becomes a function of marketing, and the beauty of OTT and the television world is that you're not dependent on a middleman. If your brand is strong, marketing has to be aggressive and reach newer markets.
On international reach
We will focus deeply on this 100 per cent on the local diaspora in Telugu, this diaspora is primarily in the US, Canada, and Australia. And in no time we scaled up to 100,000. Today we are at 110,000 subscribers in the US. Telugu works like magic because that's their connection to their roots and language.
So we've had a great success story in those three markets where a lot of Telugu diaspora is. With Tamil we are now targeting Malaysia, Sri Lanka, and Singapore, and in Malayalam, we'll be able to target UAE and cover the rest of the world.
On investments and break even
In two and a half years, we will be the first language platform to break even. So we'll break even in Telugu in five years, but we're investing in Tamil, so we'll keep investing as a company. And I believe the breakeven is occurring for a variety of reasons.
We have a better understanding of the market. Someone who lacks local knowledge may be willing to pay a 50 per cent premium for them. We are also constantly innovating and creating content to reduce the cost of content.
We are staying away from purchasing films as it is costly. As we have got into producing films and if a director wants a theatrical release we will do it, to reach a larger audience. However, the acquisition cost is fixed at the time of investment, as opposed to when it's ready, which is a costly proposition. We are not a multinational that can invest indefinitely.
