Audio over-the-top has emerged as a contributor to the growth of the music industry in India. Subscription revenue has grown significantly compared to ads revenue. In FY23, about five percent of monthly active users were paid with average revenue per user (ARPU) per month has ranged from Rs 60-70, as per the report titled ‘Regional music driving the growth of OTTA’.
Spotify has taken the top spot as the Sweden-based audio over-the-top platform has approximately 26 percent market share. Furthermore, the industry has witnessed a surge of approximately 1.6 times in daily streams to reach 460 million in FY23 while vernacular music has experienced the most rapid growth and accounted for 34 percent of music streams in FY23. One of the key strategies that have enabled Spotify to expand its user base is its focus on penetration in Hindi and vernacular languages, beyond just international music. “The COVID pandemic witnessed during FY21 and FY22, accelerated the growth of OTTA, adding more than 50 million music listeners, not only from the young age group but also among the people with more than 40 years of age,” Ujjwal Chaudhry, partner, Redseer Strategy Consultants said.
The report further stated that Spotify brought first-time audio over users between the ages of 15 to 30 years.
Vernacular streams have grown the fastest in three years owing to digital maturity growth in smaller cities and more regional label partnerships. The South Indian market has witnessed a surge in user base and engagement in the last two years attributed to the growing number of blockbuster movie releases and high growth in players like Spotify. However, Punjabi remains the lead contributor in the vernacular with a 39 percent share.
Moreover, the diversity in the subscription packs has increased (student plans, one-day and one-week packs, etc) which has led to more subscriptions, mostly coming from the top 10-12 cities of India.
Overall, the OTT Audio market has revolutionized and promises significant growth in the coming years.