‘Indian OTT market will eventually boil down to five or seven apps’

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Having spent a few months in soft launch mode, Times Internet-owned over the top (OTT) platform MX Player has officially launched with five original shows. The platform is planning to launch 20+ original web shows in 2019. The platform has the brand philosophy of ‘Everytainment’. It hosts a library of over 100,000 hours of licensed content that caters to 70 million users every day.

MX Player CEO Karan Bedi is a firm believer in the advertising-led model and noted that one differentiator for his platform is the decision not to put premium content behind a paywall. He also feels that there will be a shakeout and only five to seven players will remain standing in India’s increasingly competitive online entertainment environment. He is confident that with the scale MX Player has achieved and the user acceptance his company will be one of those players.

TelevisionPost.com’s Ashwin Pinto caught up with Bedi to talk about MX Player and its strategy.

Excerpts:

Why did Times Internet decide to acquire majority stake in MX Player?

The thesis behind looking at MX Player which was a very large platform when we bought it was saying that here is a platform that users consume a lot of video on. Can we be in a position to offer them streaming content on top of it? The acquisition was completed in October 2017 and since then we have been working hard at creating all the content, building out the streaming capabilities etc.

There are a lot of apps in the market. What is your USP?

One is just our sheer scale. We have has a user base of 275 million monthly active users. Every month nearly 300 million people use the app and every day nearly 100 million use it. In India we have 175 million people use the app. There are 70 million daily active users which puts us well ahead in the ranks of the ecosystem. This makes us one of the largest platforms in the country of any type. We have 650 million downloads globally which is twice the population of the United States and we are present in one out of every two smartphones in India.

If you look at all the premium content that we offer and have licenced we are offering it all for free. Normally, premium content is put behind a paywall. For us, we can do this because of our scale. Third, when you look at the kind of content that we are producing we are not sticking to one kind of genre. A lot of players in the market are sticking to one kind of genre of premium content.

We believe that there are stories for different demographics whether it is women, millennials and also themes like freedom of expression, school days, political thrillers, historical fiction, and visual effects. Our focus is on an entire range of content. These are things that we are doing differently. Of course, we are truly Everytainment. We truly believe in our brand promise of ‘Jaisa Mann Waisa Manoranjan’. Manoranjan includes music as well and we have done a deal with Gaana.

The OTT space has many players. Will we see a shakeout?

Yes! Eventually it will boil down to five or seven apps given the size of the media market in India. Scale and user acceptance are going to be key. Those are the only two things that will work in any internet business. We already have scale and we have seen promising moves when it comes to user acceptance. We will definitely be one of those five or seven players.

Do you see yourself as a content aggregator like YuppTV or a content platform like Netflix and Hotstar?

We see ourselves as being both. We take content from various platforms. We also produce premium content. We see ourselves as a content provider. I don’t think that I would put a label on it.

MX Player’s aim is to target the youth who are not satisfied with TV. Could you talk about this content need gap and how you are filling it?

Our primary audience is audience in the age-group of 18-30 years though we do have audiences beyond that as well. Between the head and the heart we look at stories that are relevant to this cohort of audiences. We try to create stories, source stories and provide them to our audience. We have been live for three months now with a soft launch and have 100,000 hours of content. We have seen a lot of uptake happening on that. It is playing out well.

India is a technologically challenging market with different broadband speeds in different areas. How did you address this challenge?

A lot of work has been done on video engineering front. We have built all our streaming technology in-house. We did a lot of work to optimise our app for different kinds of networks, different kinds of operators, geographies etc. We have got a great engineering team that works very hard to solve that problem. As you said the network quality is very differentiated. Maybe in certain areas you have very high quality 4G network and in other areas you have obviously more fluctuating network with a higher latency. So our team has done a great job of being able to deliver high quality content.

On the content front, could you talk about genres that you are focusing on and is regional a big white space?

We have so far showcased 10-15 different genres including love stories, historical fiction, game show, drama that will be on the platform. We are looking at every genre for specific audiences. We are of course looking at regional. One of our launch shows is a Tamil show. Another one ‘Famously Filmfare’ is in seven languages. We are doing shows in Marathi, Bengali, Punjabi, Tamil, Telugu, and Bhojpuri.

How many shows will you launch this year and is pushing the envelope important?

We are targeting more than 20 original shows this year. Pushing the envelope is important in the types of storytelling we do, in the formats we showcase. Interactive content is also an important component of what we will be doing. That will be an important part of how we roll out. We will be doing different things.

Could you elaborate on interactivity?

One of the shows is ‘Bollywood Buzzinga’ which is a Bollywood quiz show that we will be coming out with soon. That has an interactive component where the user can actually play along with the quiz and win prizes. The appeal is wide and anyone can participate.

Do you own IP for your original shows?

We do for most of them apart from a few exceptions here and there. We believe that IP is very important to us and the right to exploit IP is very important to us. We are also open to working with different partners in different ways. We think that as long as everyone is fairly compensated and happy that is the model. We are very flexible and open about these things.

What do you look before giving a piece of content greenlight?

This is a long process. We do audience analysis, story analysis, comparable to other kinds of content, prior data on content. It is part head, part heart as you to analyse it.

What sort of budgets do you work with and generally how much time does it take to create content?
Both are varied things. It can take a few months to more than a year for content to come to fruition. We work with various budgets and the budget difference between the lowest end show and the highest end is almost five to seven times.

When you look at what Netflix and Amazon Prime Video have done are there learnings for MX Player?
We see what content works for them but this is not a great comparison because their bases are very small. They focus on SVoD and our base is much larger.

So far when you look at consumption trends what are people consuming?

Web series is a very big one which reaffirms your earlier question about there being a need gap in the market. People want to watch high quality content which is not necessarily on TV. Having said that we have the SonyLIV library with us who are an important partner and this gets consumed. But our web series is the biggest category of consumption. Movies perennially do well. News is also a big genre for us. At 175 million monthly active users, we are basically a representation of the country. There is a lot of consumption across categories.

There is a debate on whether advertising or subscription will work. Could you talk about MX Player’s freemium model?

It is free. There is no payment at all. There are a number of models that will emerge in the long term. I am not sure if one of them will be plain vanilla SVoD. There might be a monthly fee, shorter packs maybe TVoD. For the moment it will be AVoD. We are in the AVoD camp but a lot of things will evolve in the market.

One of the challenges on AVoD is that there is no consistent measurement system on digital. How big a challenge is this in garnering revenue?

You have hit upon a good point that is a challenge for all platforms. But I think that the challenge is being solved. So BARC India is doing the work. Once platforms are established I think that advertisers are also seeing returns. We have already got more than 30 brands already as advertisers. They have seen good returns and we have seen a lot of repeat customers. We think that problem is slowly getting solved. Also with money moving so quickly to digital people have realised that a solution needs to be found and we believe that a solution has been found and we feel that it will be some months before things will start normalising.

Have you gone AVoD because people have a reluctance to pay?

I think that our decision has been a combination of things. I think that the payment infrastructure also needs to improve. While credits and wallets have done a great job it is still not frictionless. It still requires some effort to make digital payments. The second thing is that pricing is yet to be discovered. So much fluctuation is happening even in the DTH and cable space. At what time the pricing finally settles down at remains to be seen. India is a very different market from the West where cable rates are very high.

Internally what revenue targets have you set and by when do you expect to achieve break-even?

We are not publicly discussing revenue targets. But like I said at our scale we make a sizeable amount of revenue through AVoD. In terms of break-even, we are in the build mode right now. That is a little bit away but right now the key thing to do is to get that build mode going. That is doing well for us. Revenue will come.

Are you looking at sports and movies?

We actually have a number of interesting sports content on the platform already. The primary one is combat sports. We have wrestling, boxing, martial arts and things like that. It is a very big consumption drive in India and in general. We are not playing on cricket. Outside of that we will be looking at sports for sure. We have movies on our platform and the focus is primarily on Bollywood and regional. We are not really playing that heavily in the English space so far but that is yet to come.

Is the sports strategy this way because cricket is too expensive?

Every platform has a niche that they want to cover. Cricket rights obviously right now are expensive. But we are open to everything.

Are content costs a challenge as more players get into the online space?

To an extent there is price pressure on content. The way we look at it is that content is being given the recognition that it deserves. Content, I feel, has always been under capitalised in India. Now a lot more interesting content is coming up at different price points.

Could you talk about the content partnerships that MX Player has?

We have partnerships with companies like ALTBalaji, Sony, TVF, Arré, and Dice Media. We have over 100 partnerships in different models. It is a very important thing because partners realise that the kind of scale that we can offer to them has no parallel and to get to that scale is very, very difficult. We think that these partnerships are a win-win and they obviously believe so as well.

But don’t these partnerships take away consumers from those platforms?

The thing is that our scale is unparalleled and hard to find. In some cases, consumption is complementary and in other cases we just expand the market. Everyone has a different view on how they operate their business and we think that this works well for us.

How important are live TV channels for MX Player?

We have got a tie-up with a couple of partners in the TV space and there is still a big audience for that. We want to work with partners to ensure that people who want to consume their content can do so. We also have more than 150 live channels on our platform across news, music, movies and general entertainment.


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