The Indian OTT (over-the-top) entertainment industry is expected to reach a market size of about $4.49 billion by end 2025, with a significant increase in users, driven by growing demand for localised content and diverse genres and with the majority of revenue coming from video streaming services. The user penetration is projected to reach 35.8 per cent by 2025, with projected average revenue per user of $8.61. The OTT market is anticipated to experience rapid growth, with a considerable increase in viewers and revenue over the next few years, as the growing number of smart TVs will further drive OTT consumption in the country. Also, increasing internet access and smartphone adoption will contribute to higher user penetration for OTT platforms. It is believed that the localised content production, catering to diverse regional audiences, will gain prominence in the years to come in the OTT entertainment industry.
According to a research report published by India Brand Equity Foundation, revenue of the Indian video OTT market is dominated by reputed players, such as Amazon Prime Video, Netflix and Disney+ Hotstar is set to double from $1.8 billion in 2022 to $3.5 billion by 2027. Indian OTT platforms thus have demonstrated significant growth in the global market, witnessing a 194 per cent increase in revenue from international viewers over the last two years. The Indian OTT audience universe stands at 481.1 million people, of which 138.2 million are active paid OTT subscriptions in India.
Global viewers
Although traditional linear television offers a broad reach, OTT entertainment platforms in India provide precise targeting options by allowing the content generators and producers to reach an ideal audience. “Our popular SAB television comedy show Taarak Mehta Ka Ooltah Chashmah is also watched by millions of viewers across the globe on Sony LIV OTT,” says Sohil Ramani, project head of the most popular show produced by Neela Telefilms.
“I am bullish about the growth of OTT entertainment platforms of India in the years to come,” says Nandini Shrikent, a casting director of the Indian film industry. “And, any entertainment story that has to do with a crime genre will certainly resonate well with the Indian audience. Also, well-shot OTT shows that interestingly depict the recent history of India are also going to become popular with Indian as well as global audiences”. The government has brought video streaming OTT platforms under the ambit of the ministry of information & broadcasting. Currently, there is no framework in place for censorship of OTT content in India. However, the new Broadcasting Services (Regulation) Bill provides for a consolidated framework to regulate all content, including OTT broadcasting in the country. Shrikent hinted that the upward trajectory of OTT entertainment platforms in India might hit a roadblock if the government starts censoring the OTT content. “OTT entertainment is a paid content,” she adds. “And so, its consumption is solely at the discretion and choice of matured viewers in India.”
While credible OTT platforms have revolutionised the Indian entertainment industry, they also face significant challenges nowadays. “OTT entertainment sector in India has become a crowded and highly competitive market due to the intense presence of players like Netflix, Amazon Prime Video, Disney+ Hotstar, Zee5 and various regional platforms,” informs Debalina Ghosh, a Bollywood producer and founder, Masterkut Films. “Moreover, the Indian audience constantly demands fresh and high-quality entertainment content. It is indeed a huge challenge for the producers and entertainment content generators of our country.”
Ghosh feels the rising production costs of world-class entertainment content, including professional fees charged by top Indian actors, is a major concern for producers in our country nowadays. The sector also faces monetisation challenges as striking the right balance between affordable subscriptions and revenue generation can be extremely tricky for OTT platforms. Besides, the short lifespan of an entertainment content is also a pressing issue. Due to the binge-watching culture of the Indian audience, the lifespan of OTT entertainment content is becoming shorter as viewers in India continually demand for fresh and novel shows. “Despite these challenges, the OTT sector in India is poised for an explosive growth in 2025, driven by increased internet penetration, affordable data and a growing appetite for diverse content,” she adds. “I would picture this as a ‘full house’ of Indian viewers, from bustling metros to sleepy small towns, glued to their screens and binging on stories that strike a chord.”