Internet Television When TV Goes On As Per Your Time

In many ways, India’s tryst with cable television represents a Bildungsroman for the middle class. After liberalisation in 1991, cable TV shattered state-owned network Doordarshan’s staid monopoly, and old, crackling radios gave way to booming television sets. One television network, perhaps more than any other, symbolised this new reality: Star. When billionaire Rupert Murdoch purchased Hong Kong-based Star TV in 1993, he had locked himself into the rising fortunes of the Asian middle class “in helping American culture proliferate”, as Time magazine put it at the time.

Murdoch was one of the first to recognise the potential of India and China as lucrative viewer bases for both global and local content. From the early 2000s, India became the fastest-growing, and in effect, the most crucial international market for 21st Century Fox, Star India’s parent company. And Star India hasn’t looked back since.

From the early 2000s, India became the fastest-growing, and in effect, the most crucial international market for 21st Century Fox, Star India’s parent company. And Star India hasn’t looked back since. That’s why Star India moved fast when it sensed a new revolution was around the corner, a digital one this time. When it started streaming live sports online through its website four years ago, many market observers dismissed the move as premature. India was hugely underpenetrated in terms of networks and had notoriously slow Internet speeds. It also disrupted Star India’s own core business: broadcast television. Emboldened by the success of its sports streaming website, Star India set its sights even higher. In 2015, it launched ‘Hotstar’, an Internet video-on-demand service. That move has put Star India in the crosshairs of two other American giants, Netflix and Amazon Prime Video.

The increase in popularity of streamed video subscriptions comes from the advance in technology that can make any HDTV smart, without having to pay for an expensive new set. For example, the Amazon Fire TV Stick has the ability to make your TV interactive, with the most popular online streaming channels such as Netflix and BBC iPlayer ready at the click of a button. Gaming has also contributed to the rise in popularity of these gadgets, as many have low price or free games are available to do download and play on your TV.

Reed Hastings, the CEO of Netflix has commented that streamed channels will replace linear TV in the next 20 years saying “What you’re seeing is all of internet TV growing, the attention of the new launches of the competitors is only creating a bigger ecosystem, drawing more and more people in to thinking, ‘hey I’ve got to check that out, and try this internet TV thing.’  As we plug our gadgets into our screens or open our laptops to stream the latest movie, the rise in popularity of handpicked content which we can watch home or away any time of day is becoming a fierce competitor linear TV today.

Reasons behind the growth

The new era of Internet TV will be big and enduring, and no market will be more in-tuned and more discerning to this than India, with its rich entertainment history. Across all geographies, the internet is changing the TV business from provider-driven to consumer-controlled. Reasons for popularity of internet TV can be listed as follows:

Ecosystem growth

The internet is getting faster and more reliable, while the penetration of Smart TVs and adapters is also rising. Telcos are now moving to deliver better, faster and more reliable internet. In parallel, device-makers are improving their software, hardware and video experiences.

Freedom and flexibility

Internet and technology have liberated viewers from a fixed space. Now they can watch TV wherever they want — from smartphones to tablets and laptops to smart TVs. At the same time, algorithms using viewer profiles and watch history power a personalised experience based on individual tastes that also provoke the discovery of new programmes and genres of content.

Rapid innovation

Internet TV apps allow for real-time updates and technological advancements that continually enhance the watching experience. In a few decades, linear TV will be seen as a great transitional technology to Internet TV, like fixed-line phone to the mobile phone. The spectrum of cable, fiber and over-the-air that supports linear TV viewing will be reallocated to expand internet data transmission. Satellite TV subscribers will decrease and become more rural as connectivity improves.

Great stories travel

Internet TV will also strive because of great content and in this aspect, there is no better way to help great stories transcend borders. Whether it is Italy or India, everyone loves a great story.

The freedom to create

Internet TV networks have an advantage over traditional competitors when it comes to launching a series or a film. Traditional networks need to attract an audience at a given time while OTT services are flexible. Because OTT is not competing for scarce slots, a show that is taking longer to find its audience is one we can keep nurturing.

The beauty of the Internet TV model is that the creative community has the freedom to develop a story outside the artificially imposed limitations of pilot episodes, season lengths and advertiser-motivated story arcs. In addition, content creators and show runners appreciate this approach because it means more creative storytelling.

The consumer is in control

Internet TV has shifted control to the hands of Indian viewers. So instead of the traditional one new episode per week, consumers now binge watch their way through a series — that is, on average, finishing an entire season in one week.

Over time, this evolution will dilute the relevance of linear TV schedules, where programmes are presented only at particular times on non-portable screens; and viewers are willing to pay a fair price for content. Internet TV — which is on-demand, personalised and available on any screen — is giving viewers the freedom to choose and the industry will only advance from here.

Betting big on India

Netflix and Amazon are expected to both pave the way for paid content in India and also benefit from the tailwinds that are driving the subscription model. So what does the entry of these two big global players mean for the industry in India?

Reed Hastings, founder and CEO of Netflix, says premium pricing is part of Netflix’s India strategy. In a recent visit to the country, he said: “There are around 300 million smart phone users in India. But we are targeting mostly the high end — 10 or 20 million — for whom our pricing is not a problem.” Pointing out that India is “hugely important” to Netflix because “it’s one of the strongest internet markets,” Hastings added that “India has seen the highest growth among all its Asian markets.”

Netflix’s India performance evokes a mixed response. Jehil Thakkar, an industry analyst who until recently was head of media practice at KPMG India, says Netflix has had “minimal impact” and “is being consumed by only a very small sliver of the India market.” Rajiv Vaidya, CEO of video streaming platform Spuul, feels that Netflix has “created a huge buzz” at the top end of the market.

Frank D’Souza, head of the entertainment & media practice at PwC India, notes: “Despite the fact that Netflix is a subscription-based platform in a market dominated by players like Hotstar and Voot which provide content almost free of cost, it has been able to attract 4.2 million active users and is among the top 10 OTT (over-the-top content, which refers to audio, video or other media delivered over the internet without users needing a cable or satellite subscription) platforms in India. Therefore, Netflix’s performance is quite reasonable in that sense. The performance of Amazon Prime Video under similar circumstances, in a shorter span of time, has been relatively better, but that is on the back of a differentiated pricing strategy, and an existing customer base for its e-commerce business.”

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