Viacom18 Media Pvt Ltd plans to launch an online video streaming platform early next year, as the broadcaster plays catch-up in the over-the-top (OTT) content business.
"Digital today forms a big part of consumers' viewing habit, particularly in the case of urban youngsters and people with smartphones. So, it's important that our content is made available across platforms, from conventional TV to new digital platforms," Viacom18 group CEO Sudhanshu Vats told VCCircle.
The company is a joint venture between Viacom Inc and Reliance Industries-owned Network18.
Viacom18's move comes at a time when many of its rivals have quickly moved to establish their digital presence in the Indian media and entertainment sector, which a recent report by the Confederation of Indian Industry and the Boston Consulting Group pegged at Rs 115,500 crore. The report said that the TV industry grew at a compound annual rate of 10 per cent during 2010-2015 and stands at Rs 60,000 crore.
Among Viacom18's competitors, broadcaster Star Group has launched digital property Hotstar while Multi Screen Media, which runs the Sony group of channels, has introduced SonyLiv. Zee New Media, the digital arm of Zee Entertainment Enterprises Ltd, has rolled out Ditto TV. Media house The Times of India Group, which also runs news and movie channels, has entered the space with unit Times Internet Ltd launching premium online video streaming service Box TV.
Several new players have also emerged, overturning linear value chains. These independent OTT platforms include Spuul, HOOQ and Hungama Play.
However, most OTT players have opted for an advertising-led business model. This makes generating revenue an uphill task.
A senior media analyst, who did not wish to be named, said that growth of OTT platforms depends on internet connectivity and cost of data. "OTT players are hopeful that with a rise in internet penetration and with the roll-out of 4G services, data costs in India will drop. Only when data costs drop will more people watch content online. That will allow OTT players to charge users for premium content," the analyst said. But until that happens, OTT players will have to depend on advertising, he added.
Viacom18's digital strategy started taking shape in July when the broadcaster launched its digital division. The company has appointed Gaurav Gandhi as chief operating officer of Viacom18 Digital Ventures and Monika Shergill as content head.
Prior to joining Viacom18, Gandhi was group COO at IndiaCast Media Distribution, a distribution company formed with the coming together of TV18 and Viacom18.
Shergill is responsible for driving content and programming strategy for the digital business. She reports to Gandhi.
Star Group is part of 21st Century Fox, the media house controlled by Rupert Murdoch. Murdoch also controls News Corp, the parent of this news website.