Starting from Vedas or mythologies like Ramayana or Mahabharata, the culture of listening to a story for entertainment or educational purposes, is deeply rooted in India. The knowledge of Vedas used to be transmitted from teachers to students verbally, people used to recite and enjoy Ram-katha (story of lord Ram) to calm their minds. The era has changed, but the practice of listening seems to be the same in India even after hundreds of years. While the knack has been the same, the form of content gradually seems to be changing with the advent of digital technologies. “Audio as a medium largely is dependent on music. For audio stories to pick up and grow as a category in India, this medium requires good stories, besides a good marketing and distribution strategy which is further backed by celebreties including influencers,” Ashish Pherwani, partner, Media and Entertainment and Business Consultant, EY, told BrandWagon Online.
The continued focus of audio streaming platforms on converting free to paid consumers is expected to grow the subscriber base from around 7.5 million in 2023 to 15 million in 2026, though we expect ARPUs to reduce to about Re 1 per day on an average by then, as per the FICCI-EY report. However, so long as free options are available, such as FM radio and YouTube, it will be difficult for streaming platforms to grow paying subscribers to a substantial base. The report further stated that the number of monthly music streamers has marginally decreased to 185 million in 2023, compared to around 200 million in 2022. Just four percent of streamers paid for a subscription, on the back of certain platforms transitioning to paid models, while others reduced features in their free offerings to persuade users to subscribe. Despite this audio players have begun to experiment with the content in their very own way. “Audio content has always been the front-runner for sustained growth and consumers’ attention. In the recent past, podcasts have stolen the show. They are more than a passing craze. In the category of podcasts, storytelling formats have been fertile grounds for intensifying audience engagement. Red podcasts like Ek Kahani Aisi Bhi, India Classified, and Indian Murder Mystery have solidified their role as a mainstay in media consumption. As listeners become more hungry for content, their tuning into storytelling formats like such has helped in satisfying the cravings,” Nisha Narayanan, director, COO, Red FM, Magic FM said.
Experts believe that beyond genres, audio content is branching out in regional languages. It is believed that regional content has a comparatively higher and sustained growth ability when it comes to engagement.
Content vs Money
To be sure, audio streaming subscriptions in India amounted to about Rs 300 crore in 2023 and is estimated to reach over Rs 600 crore by 2026, as per a report by Statista. Like other mediums, audio streaming platforms revenue model is divided between advertising and subscription. For example, Spotify allow users to buy premium service for Rs 59 for first three months and then charge Rs 119 per month whereas Pocket FM sells its subscription for Rs 99 per month. It is believed that Spotify as a platform is mostly preferred for podcasts whereas PocketFM is mostly opted for long form audio series. Moreover, in an effort to up the subscription amount, platforms have also introduced models like pay-per-view. What this means is users only pay for those content they want to consume. “We believe in bold experimentation. In 2021, we created a new entertainment category with audio series, characterised by serialised fictional audio storytelling. In 2022, we introduced micropayments as a monetisation model, moving away from the traditional subscription approach. Both experiments have been successful and now complement each other. Our entire monetisation model revolves around this micropayment-led approach. The success of this model reflects the preferences of the Indian audience and has been replicated in global markets, including the US,” Suyog Gothi, Head, Pocket FM, India, said.
It further claimed that its operational model follows a freemium structure, offering a set number of free episodes for each audio series within a 24-hour window. Listeners can unlock additional episodes by purchasing single episodes or entire series through a coin-based system. Pricing is adapted to local markets, starting at rupees nine (trial pack) in India.
Apart from subscriptions, these platforms earn from ads run on their respective platform. The audio over-the-top (OTT) market in India was valued at $0.6 billion U.S. in FY21, as per market research firm. Statista. It is expected to grow up to 1.1 billion U.S. dollars in the next four years and up to $2.5 billion dollars by the end of FY2030. Industry experts believe that unlike radio audio OTT platforms provide a better mechanism to gauge the return-on-investement (RoI). “Unlike traditional advertising methods, digital advertising provides powerful analytics and tracking tools, allowing advertisers to measure campaign performance in real-time and optimise strategies for better results. AI algorithms analyse numerous user signals to ensure that ads are delivered to the right person, in the right place, at the right time, allowing for highly targeted and personalised ad delivery,” Abe Thomas ,CEO, Reliance Broadcast Network Ltd told BrandWagon Online. Moreover, the approach of programmatic advertising focuses on targeting methodology, which enhances the return on ad spend (ROAS) and reduces wastage. These ads are typically bought on a cost-per-thousand-impression (CPM) basis, where advertisers pay a set amount for every 1,000 impressions their ad receives. This dynamic pricing model ensures efficient allocation of advertising budgets and improved campaign outcomes.
It is has also noticed that the demand for spiritual or religious content on audio streaming platforms have been on the rise. Experts stated consumers tuned into tales of Ramayana-Mahabharata in audio streaming platforms also. “In 2023, four of the top 10 podcasts on Spotify in India were of mythology or spiritual genre which grew over 80% through the year. According to Spotify-wrapped data, the most streamed podcast of 2023 was also from this genre. Some of the top performing spiritual or mythological podcast on Spotify in spoke2023 included Shrimad Bhagabad Gita, Krishna-The Supreme Soul, Mahabharat Gaatha, The Stories of Mahabharata and Osho Hindi among others,” a Spotify spokesperson said.
Media experts cite the pandemic to be a key socioeconomic factor behind this surge in demand for religious content. According to Narayanan, particularly in the aftermath of the pandemic, people are longing for solace, peace, and a deeper connection to their spirituality. A fitting instance of this trend is our podcast series ‘Mere Prabhu Ram’ which has amassed over 1.5 million listens since January. This success story plays a cupid in establishing our listeners leaning toward spiritual content for comfort, guidance, and a sense of community,” Narayanan added.
Individual creators vs big organisations: David vs Goliath?
It’s not only about the company that has been making money out of content, it’s also about creators who earn money out of content. While different companies have different monetisaiton models for their creators, media experts said they mostly operate in a freelance or contractual market. For Kuku FM, the company has two ways through which creators and artists can make money. “For the audio shows that we own, we pay the creators one-time for their production. Then there are audio shows that we co-own with the writers or publishers, for which we operate on a production and revenue share model basis show performance. To maintain transparency, the creators can track the show’s stats in real time. Last year, we recorded Rs 15 crore in creator payouts,” Lal Chand Bisu, co founder, CEO, Kuku FM told BrandWagon Online.
While several platforms seem to democratise the creator community, Pocket FM claims to serve as an open stage for anyone with a creative flair for writing. The platform claims to provide earning opportunities to writers by letting them publish their novels on Pocket Novels, the company’s online reading platform. “Our ecosystem has witnessed the writers’ community flourish to over 250,000 writers with the top-performing writers earning impressive incomes. Our commitment lies in continuing to nurture and expand our writers community, providing them with the tools and support to create more audio series and share their content with a global audience. Our goal is to enable them to flourish and gain recognition while we aim to build the largest audio creator community on a global scale,” Gothi added.
Other than creators individual content creators seem to have put up a strong challenge to these platforms. For instance, Mir Afsar Ali’s (also known as RJ Mir) YouTube Channel has 1.13 million subscribers at the time of filing this report. While the popularity of creators like Ali seems to indicate the prospect of this market, it also seems to predict the future of this industry. “Podcasts and audio channels provide a direct and personal way to connect with audiences, offering journalists and media personalities greater creative control over their content. Lower production costs and reduced barriers to entry make launching a podcast more accessible than traditional media. Additionally, the growing listener base and increased consumption of audio content highlight strong market potential. Furthermore, individual content creators have the benefit of agility and adaptability which allows them to quickly respond to audience preferences and trends,”Thomas added.
Many big organisations have been collaborating with popular independent creators to reach new audience segments and enhance their engagement. Industry experts opime that the future is likely to see a blend of independent creators and traditional media coexisting, with partnerships and hybrid models becoming more common
Future looks bright
Not only entertainment or religious content, there has been a significant rise in demand for educational content too. “As per Spotify Cultural Next Report,2023, Gen-Z generated more than 186 million podcast streams on Spotify in the first half of 2023. In India, Gen Z’s podcast listenership on Spotify has skyrocketed. Listenership of education as a segment grew 140%, mythology or spirituality clocked 230% rise, and health and fitness clocked 140% growth compared to the previous year which reflects a strong appetite for knowledge,” Spotify spokesperson added.
The strong appetite for knowledge can also be assessed from the demands of audiobooks which are created for students. Students who have been preparing for various exams including SSC, CGL, and UPSC-CSE among others have tuned into audio content that caters to their needs. “In the previous year, Users of Kuku FM listened to almost 620 million minutes of content on general knowledge, history, science, current affairs, society and culture, and more. All these genres support the preparation of many competitive (government and beyond) exams. These audio shows combine factual data with an entertaining element of storytelling that makes learning quite enjoyable,” Bisu said, adding that not just competitive exams, but other professional aspirations have also found a supporting tool in our audio shows, with about 540 million listening minutes for business, career, productivity, and charting various skills like financial modeling, video editing, English speaking, and more.