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Hotstar tops reach by install, but Netflix has highest ARPU from subscriptions

Hotstar, the OTT platform from Star India, leads the competition in the space in ‘Reach and Market Share by Install’. Meanwhile, Netflix’s base of paying customers and ARPU is higher than other OTT platforms. This was revealed by data intelligence & management platform KalaGato. 

According to the study, Hotstar surpassed BCCL-owned MX Player in February to register Reach by Install of 42.69 per cent in February 2019 and further widened the gap with the highest Reach by Install of 45.88 per cent in March 2019. The OTT player also had the highest Market Share by Install of 23.8 per cent in March 2019. 

Offering users a mix of SVOD and AVOD, Hotstar’s Average Order Value has grown 1.5X in the period October 2018 to March 2019, indicating a ‘premiumisation’ of the subscriber base and a shift to SVOD from AVOD over time, KalaGato observed. 

On the other hand, MX Player, which had a strong Reach by Install of 57.55 per cent in January 2018, has been seeing a fall in its market share over the one-year period. Times Internet had announced the acquisition of MX Player in January 2018 and it was launched as an OTT platform in February 2019. Rather than build and market an OTT player from scratch, Times Internet chose to buy out a South Korean video player that was already popular in India and convert it to an online streaming service. 

In this one year, MX Player’s reach has fallen dramatically as users switch to traditional OTT platforms. Despite the fall, MX Player has the second highest ‘Reach and Market Share by Install’. The platform garnered Reach by Install of 41.40 per cent in March 2019, while its Market Share by Install stood at 21.5 per cent in March 2019. 

Meanwhile, according to the KalaGato report, Reliance Jio’s multi-pronged strategy is giving them an edge. Reliance Jio has taken a page out of Amazon’s book and is using their OTT service – Jio TV – to helm in users. With AJIO, they have fashion e-commerce and plans are afoot for them to get into the grocery delivery space. 

Jio TV recorded the third highest Reach by Install of 34.08 per cent and also the third highest Market Reach by Install of 17.7 per cent in March 2019. 

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The report further stated that Amazon Prime Video is growing, but it is being given away for free. Prime Video is the trojan horse that Amazon is using to ensure customers stay within their ecosystem. As Amazon straddles everything – from fashion to groceries – they are using content to ensure that users stay within their ecosystem. Prime Video is being bundled and given away for free with everything – from Vodafone to BSNL. Amazon is leveraging content to draw in users to its prime service and hoping that a superior logistics and delivery experience will build customer loyalty. 

The efforts are paying off as Amazon Prime Video had the fourth highest Reach by Install of 17.06 per cent in March 2019, which has steadily grown from 3.23 per cent recorded in January 2018. The OTT platform was placed fourth as per Market Share by Install of 8.8 per cent in March 2019. 

Netflix may not have a large base of subscribers, but they are all premium clients with a high ‘willingness to pay’. Their base of paying customers and ARPU is higher than other OTT platforms. At an average of Rs 655 per month, Netflix’s ARPU from subscription fee is much higher than other OTT platforms. 

Netflix is placed fifth as far as Reach by Install is concerned, which stood at 10.37 per cent, and a Market Share by Install of 5.4 per cent in March 2019. 

SonyLIV follows in the sixth spot as per Reach by Install of 10.5 per cent and in the sixth spot as per Market Share by Install of 5.2 per cent. 

As per the report, Sun NXT (Sun TV’s foray into the OTT space) more than doubled its customer base in 2018. The growth of Sun NXT is interesting not because their footprint is large, but because as a homegrown television network, they are starting to make their mark. The audience for regional cinema is massive and Sun has a library of content and a brand name that customers recognise. 

Sharing his insights on the OTT industry and the report, Aman Kumar, Chief Business Officer, KalaGato.co, remarked, “The online streaming industry has grown exponentially over the last one year. Netflix has shown that there is a large segment of users willing to pay a higher than average subscription fee. Hotstar, on the other hand, has built their business combining both SVOD and AVOD. Even within the AVOD segment, from the users’ end, there is a flight to quality, that is, with increasing choice, they want higher quality content.” 

He further said, “Flagship movies, TV shows and Sports events have proven to be excellent customer acquisition tools for online streaming platforms, but they need to support these with other engaging properties to retain users.”

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