Tuesday December 10, 2019
Home Business Netflix and O...

Netflix and OTT Platforms Slowly but Steadily Eating Cable TV Business

The potential reasons for this decline were non-renewal of subscriptions, the transition of subscribers to alternate sources of entertainment

0
//
Netflix, Cable TV, Business
While the C&S universe was reported to have expanded to 197 million households by the end of 2018 with digital cable gaining the most, there was an erosion in the active subscriber base in the last quarter. Pixabay

Netflix and other over-the-top (OTT) platforms are slowly but steadily eating the cable TV business, a new KPMG report has said, adding that there was a decline of nearly 12-15 million active subscribers for the cable & satellite (C&S) universe in the fourth quarter (Q4) of the financial year 2019.

Subscription revenues grew at a modest 8.1 per cent in FY19 to reach Rs 463 billion, with the NTO implementation hiccups costing growth in the last quarter.

“While the C&S universe was reported to have expanded to 197 million households by the end of 2018 with digital cable gaining the most, there was an erosion in the active subscriber base in the last quarter with a decline of nearly 12-15 million households in the overall C&S household base,” said the KPMG report titled “India’s Digital Future: Mass of niches”.

The potential reasons for this decline were non-renewal of subscriptions, the transition of subscribers to alternate sources of entertainment such as OTT and certain blackouts owing to the implementation of the the New Tariff Order (NTO).

Netflix, Cable TV, Business
Netflix and other over-the-top (OTT) platforms are slowly but steadily eating the cable TV business, a new KPMG report has said, adding that there was a decline of nearly 12-15 million active subscribers. Pixabay

“As a result, subscription revenues took a hit in the last quarter with subscribers facing multiple issues, including higher cable bills, while transitioning to the new regime,” the report mentioned.

The Average Revenue Per User (ARPU) was relatively flat for both DTH and cable operators in the first three quarters before seeing an increase by 10-25 per cent in the last quarter.

“While the active subscriber base declined, growth in ARPUs covered up a large part of the decline in subscription revenues, leading to overall growth of 8.1 per cent for the year FY19,” the findings showed.

While the English watching audience is relatively smaller in India, the widespread availability of English content on OTT platforms has been one of the key factors for a shift in consumption from TV to digital for English content.

Also Read- Fires in Amazon Rainforest may Set New Record

Netflix has planned to invest Rs 6 billion per year in originals, whereas Amazon Prime had committed Rs 22.3 billion (in 2017) over 2-3 years in India.

For some original series, global platforms like Amazon and Netflix are spending in the range of Rs 10-20 million per episode.

For example, per episode cost of original series, including ‘Made in Heaven’ and ‘Mirzapur’ on Amazon Prime, was Rs 10-20 million.

“From the subscription-only Netflix and Amazon Prime Video to hybrid models of Hotstar and Zee to new multi-format models like MX Player, OTT players are striving to differentiate themselves,” said the report.

Netflix, Cable TV, Business
Subscription revenues grew at a modest 8.1 per cent in FY19 to reach Rs 463 billion, with the NTO implementation hiccups costing growth in the last quarter. Pixabay

There could be close to 11-14 million direct paid subscriptions in FY19, including Amazon Prime subscriptions, said the report.

Owing to the relatively higher price points and the wider e-commerce appeal associated with Netflix and Amazon Prime, respectively, these two platforms accounted for a bulk of the direct subscription revenues.

Owing to a robust slate of live sports, the international library and live TV content, Hotstar also contributed significantly to the overall direct subscription revenues of the industry in FY19.

Also Read- Zomato Reconstructs its ‘Gold’ Service to Benefit Restaurants

“We expect the direct subscriber base in India to rise to as much as 55-65 million by FY24, driven by the availability of high-quality content curated for different audiences and continued growth in the digital infrastructure and the digital payments landscape in the country,” said the report. (IANS)

Next Story

OnePlus Rolls Out Support for Netflix App for its TVs

OnePlus TV update brings support for Netflix

0
Netflix TV
Chinese Technology OnePlus rolls out support for netflix app for its TVs. Pixabay

Chinese technology company OnePlus on Monday announced that it has started rolling out another update for its TVs which brings official support for the Netflix app.

The Netflix app will come pre-installed for new users and will be made available through an update for existing users in the OnePlus TV 55 Q1 and OnePlus TV 55 Q1 Pro TVs.

“We at OnePlus have always sought to provide the best possible technology on all our devices. Over the years, Netflix has played an important role in bringing an unmatched viewing experience on our smartphones, said Vikas Agarwal, General Manager,” OnePlus India said in a statement.

“The association opens up a whole new world of possibilities, empowering storytellers on Netflix to expand into a whole new avenue for delivering diverse stories,” Agarwal added.

Netflix
The Netflix app will come pre-installed for new users. Pixabay

Powered by Android TV, the 55-inch OnePlus TV houses 4K QLED display combined with Dolby Vision and a powerful 50W 8-speaker setup rendering a surreal surround sound experience.

As part of OnePlus completing 6 years since its inception, the company is also rolling out offers on its TVs as an extension of gratitude to its community.

The offer includes an instant cashback upto Rs 5,000 on all transactions using HDFC credit and debit cards and cashback of upto Rs 6000 on purchase through Amazon Pay

Additional Rs 3,000 off on exchange on purchase of the OnePlus TV, along with no cost EMI for up to 24 months

Also Read- Tech Giant Amazon Collecting UK Health Service Data for Free: Report

Users can experience the recently launched TVs at the OnePlus Experience Stores in Bengaluru, Mumbai, Delhi, Chennai, and Pune.

The OnePlus TV starts at Rs. 69,900 and is currently available for purchase on Amazon.in and across 100+ offline outlets of Reliance Digital across the top 12 cities in India. (IANS)