MUMBAI: Balaji Telefilms’ digital arm ALTBalaji recently completed three years. While the management always spoke of profitability and breaking even faster rather than cash-burn and tons of investment, the platform seems on track in achieving its ambitions despite the COVID-19 climate. Though production may be halted, content-hungry subscribers have flocked to the streaming service for their dose of entertainment. Despite the setback, the OTT platform is confident that it has enough shows in the bank to woo subscribers for the next few months even if lockdown persists.
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In an interview with Indiantelevision.com, Balaji Telefilms group COO and ALTBalaji CEO Nachiket Pantvaidya spoke about the growth during post COVID-19 period and overall outlook FY21.
Edited excerpts:
ALTBalaji had a good run in the first three years focusing on the Hindi-speaking market. Will there be any significant change in the content strategy going forward?
We are currently focusing on ensuring that we dominate the Hindi speaking markets and then move ahead. If you look at the geography and demography of the country, 70 per cent of the content consumed is Hindi. As a platform, it makes sense to focus your efforts in one direction and win over the Hindi-speaking population. Hence, this year we are first going to focus on ensuring that we dominate the Hindi space.
We will gradually move towards other regional markets as well in the coming years. A host of our Hindi offerings have also been dubbed in Indian and international languages like Tamil, Telugu, Malayalam, Bahasa, Arabic, etc. amongst others. We shall continue to focus on expanding our language content library in the coming years.
ALTBalaji had the mantra of breaking even within 2021 which you are nearing as per the last investors call. What will be the big target now?
ALTBalaji has been working towards its goals and is the first OTT platform already on the road to profitability. With our costs getting controlled in the first half of fiscal 2020 and the loss margin further reducing at the end of the current fiscal, we are aiming to break even in 2020-2021.
Given the national lockdown, all content production has come to a standstill; we continue to monitor the situation closely. We are very confident that the demand for content will increase once the situation returns to normal and are well prepared to resume business and ramp up content sales once the lockdown is over.
Do you expect a significantly higher-than-expected jump in FY 21 under the current situation?
We are looking at a 1.7 million active subscription base which is a high record for us. We are adding roughly 17,000–20,000 subscribers per day, that’s nearly doubling the run rate from where we were in February. In Q3, we had already said that our losses were down to single digits, and we are hopeful that in the next 12 months period, we will break even ALTBalaji's business.
Could you share the current growth under COVID-19? Which genres see more uptake? Did any particular demography or age group consume more content on the platform?
Indian originals have picked up pace in the past few days as audiences are on the lookout for local relatable content. We believe in creating shows which appeal across segments however, with narratives that are unique or untold.
For instance, shows like Kehne Ko Humsafar Hain, Karrle Tu Bhi Mohabbat, It Happened in Calcutta, Baarish, Dil Hi To Hai etc., are mostly consumed by women in 25-45 years TG across India. However, thrillers like Apharan, Ragini MMS, Code M are consumed by men in the 22-45 age bracket. In addition to the above, shows such as Mentalhood, The Test Case, MOM: Mission Over Mars, Bose: Dead/ Alive, The Verdict – State vs Nanavati are being consumed extensively by urban Indians across age groups.
Shows launched in earlier months continue to see good engagement as consumers are now watching more of the library that we have successfully built. The ALTBalaji library as of date has 60-plus shows with engaging content for mass Indian audiences.
What has been the growth of new subscribers? How will you retain them once the lockdown is lifted?
Watch times and subscriptions have been seeing strong growth during this period and we are witnessing a high level of growth in all our key markets and demographics. ALTBalaji is witnessing strong uptake of digital subscriptions with an average of 17,000 subscriptions added per day post lockdown vs an average of 10,600 in March 2020 pre-lockdown, a growth of 60 per cent. As of date, the platform has over 1.7 million active direct subscribers.
With the SVOD OTT space in the country becoming increasingly price-sensitive, we have facilitated growth by keeping our pricing extremely low, at less than a rupee a day (Rs 300/- annually). What works best for us is to concentrate on consumer segmentation behaviour, understanding how to retain the customers better and working on onboarding the new segment who have just been acquainted with the internet. With content being king, there is a growing acceptance amongst consumers to pay for unique narratives and good storytelling which keeps them hooked to their screens. Having said that, we are confident that having sampled our portfolio of exciting, original digital series to a wider audience that has a higher propensity and capacity to subscribe, we will continue as one of the top OTT platforms.
Due to the stoppage in production, do you expect any rescheduling of your content slate? Has there been any change in the guidance of expected originals during the calendar year?
So far, we are on track in terms of the show launches. We have 11-12 shows that have been shot already and only need post-production and editing, which can happen from home as well. So we actually have a stock of 10-12 shows which can be put out in the next six to seven months even if the unfortunate lockdown continues for a few more months. We are in a good position to give out one to two shows per month for the next five to six months. We are now launching, in the next 25 days, Baarish season two and KKHH season three.
How has the overall ecosystem changed since you started the journey?
Having set milestones and breaking new grounds for over three years, our journey has been fairly business-positive and will continue to do so. Since its inception, ALTBalaji has been on top of the consumer mind for its unique narratives and clutter-breaking original Hindi content and we have aggressively grown on the back of innovative business strategies. Moving from strength to strength, we’ve today become a major player in the Indian OTT industry and gained further encouragement by the massive increase in subscriber base. With a substantial bouquet of original content across genres that keeps viewers engaged, our app has consistently ranked amongst the top three grossing video streaming apps in the country across the app store (Source: App Annie).
According to a recent report by PwC, the OTT market is set to grow at a rate of 22 per cent to reach Rs 12,000 crore in the next four years. The soon-to-arrive 5G networks will only work as a shot in the arm for OTT platforms to scale further heights. Digital is an ever-evolving medium and when it comes to OTT players, competition across the industry is soaring high with everyone trying to secure their places in the minds of consumers.
Last year you struck a deal with ZEE5. How has it helped you? Are you planning any similar deal?
With our collaboration with ZEE5, we aim towards leveraging each other’s strengths in the OTT domain, to co-create original content. This association is a collaborative process of co-understanding consumer insights and co-marketing to serve the viewer better while reaping in increased dividends for both. ALTBalaji and ZEE5 have established their content strength globally, and the synergy resulted in two of the largest home-grown video streaming platforms coming together to expand their subscription base and grow the binge-watching culture globally.
ALTBalaji has also successfully completed the first-ever syndication of a digital series to a broadcaster with three hit digital shows now airing on prime time television. Karrle Tu Bhi Mohabbat, Baarish, and Kehne Ko Humsafar Hain are now available between 9 pm and 11 pm on Zee TV. This deal helped generate additional revenues via syndication fees and created a larger consumer funnel for us.