65% of Video Consumption Coming from Rural India Courtesy of Affordable Data Plans from Jio

Rural India has only 40% internet connectivity, but consumers are ready to watch videos via OTT platforms because of the cheaper data plans

By April 2nd, 2019 AT 7:31 PM
Highlights
  • Reliance Jio started the trend of affordable data plans in India
  • Users are even replacing their STBs with OTT platform subscriptions

The video streaming market in India has exploded — thanks to Reliance Jio — with 65% of video consumption coming from rural India that has only 40% Internet connectivity, says TV Ramachandran, President, Broadband India Forum (BIF). According to him, the viewing habits have changed and digital service providers — from Netflix to Hotstar — are bombarding users with original videos-on-demand, threatening the very existence of Cable TV with a set-top box.

“Unlike the common thought that urbanites are watching more content online, 65% video consumption is coming from the rural parts of the country thanks to cheap data plans, especially from Reliance Jio, and affordable smartphones. Those who cannot afford to buy a smart, connected TV are now streaming OTT content on phones,” Ramachandran told IANS.

Popular Indian digital service providers like Hotstar, ALT Balaji, Zee5, Voot, BigFlix, Sony LIV, Eros Now — apart from the global giants like Netflix, Hulu and Amazon Prime Video — have flooded the smartphone screen.

There are currently more than 32 online content and video streaming platforms in the country and the market is expected to hit $5 billion by 2023, according to the global management consulting firm Boston Consulting Group (BCG).

Riding the popularity of ultra-cheap data packs offered by Reliance Jio, which has amassed 280 million subscribers in a short time, India has emerged as the country that provides mobile data at the lowest rate in the world.

On a question about the debate of providing a “level playing field” between the telecom service providers (TSPs) and digital service providers, Ramachandran said it holds no merit. “Telcos have the network and data while OTT players are software-driven platforms. Telcos need to build a synergy with OTT players. There is no question of ‘level playing’ field as these are two different entities.

“An OTT player cannot become a TSP, but a TSP can become an OTT player, so it is actually the other way around. OTT players who have low-entry barrier can actually demand a level-playing field as TSPs strive to enter the original video-streaming space,” noted Ramachandran.

Apple has recently announced a new Apple TV+ video streaming service in the crowded OTT market and the time is not far when it will come to India with original desi content with disruptive pricing and strategic alliances with industry stakeholders.

With the growing popularity of smartphones (India currently has nearly 450 million smartphone users) in tier-3 and tier-4 cities alongside the hinterlands — coupled with ever-lowering data costs – the truth is that many users will consume OTT for the very first time.

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