With mobile phones overtaking traditional platforms such as TV to become the preferred screen for a majority of Indians, the proliferation of data plans and availability of sub-$100 smartphones, information and entertainment are being consumed on the go.
As online video streaming platforms such as Netflix and Amazon Prime Video are upping the ante by garnering handsome subscription numbers over the last one year, Star India-owned Hotstar continues to flaunt the largest user base.
Hotstar posted a 100% jump in the user base to 67.5 million in August from 33 million in the same month last year, show data released by research firm App Annie. Time spent by viewers on the platform jumped two-fold to 15,574 million minutes in August 2017 from 4,739.8 million minutes in the same period last year.
Netflix also posted a 100% increase in the user base to 5.37 million from 2.56 million during the same period. However, the number of viewers logging on to the platform still remains much less compared to Hotstar. Time spent by viewers on Netflix has grown by more than 150% in the last one year. In August this year, viewers spent about 1,563.5 million minutes watching content on Netflix, compared with 582.7 million minutes spent in the year-ago period.
Amazon Prime Videos has clocked a 100% growth in the user base at a faster pace compared to Netflix. Launched in December last year, the number of viewers accessing the streaming app stood at 12.64 million in August 2017 from 5.82 million.
However, the business models of Hotstar, Netflix and Amazon are different. While average monthly subscription of Netflix is Rs 700, Hotstar earns a majority of its revenue from advertising. Additionally, Hotstar runs a subscription service for international content such as Game of Thrones.
The platform charges users Rs 199 as monthly subscription. Amazon Prime Videos earns its revenue through subscription, with users paying an annual fee of Rs 499.
Industry watchers contend that in terms of revenue, both Netflix and Amazon Prime Videos would earn higher subscription money despite being watched by a limited number of people.
As for Hotstar, the increase in revenue totally depends on the number of users. “With a strong content from Star’s large network of channels, which is free to watch, Hotstar will always have a strong user base. As its user base and time spent on the platform continue to increase, Hotstar will be able to charge higher ad rates. There is chance that in the long run it may even surpass what paid platforms such as Netflix earns from India,” said a senior media planner.
Novi Digital Entertainment, a wholly owned subsidiary of Star India, which runs the video over-the-top (OTT) platform, Hotstar, reported a net loss of Rs 409 crore in FY16 — its first full year of operation — according to the company’s filing with the Registrar of Companies (RoC). During the period, the company’s revenue stood at Rs 185.7 crore.