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<ul><li>Online casual gaming to be the largest sub-segment amongst the online gaming segment in India, contributing ~58% to the overall revenues by FY25.</li><li>Growth to be led by a continued increase in consumption, robust brand interest and maturity of the Indian gamer in terms of consumer spends.</li></ul>The online gaming segment has grown at a rapid pace in the last 3-4 years and is now competing with traditional forms of entertainment for the share of time spent on media and entertainment in a day. While the COVID-19 induced lockdowns had an adverse impact on the economy and traditional segments of the M&amp;E industry, online gaming as a segment got a leg up in terms of both consumption and partly, monetization. This is evident from the fact that India had the highest game downloads in the casual mobile gaming sub-segment in the world (excluding China) in 2020, with Q1-Q3 2020 downloads standing at 7.3 billion, accounting for 17 per cent of the global mobile game downloads. Further, the monthly active users for the top 100 mobile games and the time spent on online gaming, are higher by 10-15 per cent post lockdown 2020, indicating the establishment of a new normal. Gamers across demographics took to online gaming as a means to connect with family and friends, with the supply side also playing its part, in terms of multiple titles getting multiplayer features, with a social layer to them, to encourage group consumption. With India experiencing a second wave of the COVID-19 pandemic currently, it is envisaged that the consumption of online casual gaming is likely to continue being robust, helped by the robust digital infrastructure that India has, and the continued investments by Indian and global developers and publishers in making world class games available to the Indian gamer. In order to decode the casual gaming market in India, its constituents and deep dive into what the future holds for this sub-segment, <keyword id="50041" type="COMPANY" weightage="20" keywordseo="KPMG">KPMG</keyword> in India today launched a report titled – ‘Beyond the tipping point – A primer on Casual <keyword id="1110821" type="PERSON" weightage="20" keywordseo="Gaming-in-India">gaming in India</keyword>’, which reveals that the overall online casual gaming sub-segment in India stood at a size of INR 60 billion in FY21 and is projected to grow at a CAGR of 29 per cent over FY21-25 to reach a size of INR 169 billion. The report aims to define the online casual gaming sub-segment in India, and the various lens through which this definition can be seen. It also throws light, on online casual gaming’s projected growth potential in terms of revenues &amp; user base, key growth drivers, current challenges and explores evolving themes such as cloud gaming, outsourcing of game development, platform plays, multi-game platforms and AI (Artificial Intelligence) in casual gaming. Additionally, it also places a specific emphasis on outlining the understanding of the monetisation models around both advertising and consumer spends, and how India’s movement up the casual gaming maturity curve is likely to help in improved monetisation across the board. It also highlights, the emerging phenomenon of rewarded advertisements as a means to strike a balance between monetisation and game experience, as advertisement revenues remain a unique feature to the Indian online casual gaming sub-segment. Highlights India’s online gaming ecosystem and its potential <ul><li>The online gaming segment in India was estimated at INR 136 billion in FY21 and is projected to grow at a CAGR of 21 per cent over FY21-FY25 to reach a size of INR 290 billion.</li><li>Of the total size, the online casual gaming sub-segment is the most significant one and stands at INR 60 billion in FY21, accounting for ~44 per cent of the total online gaming revenues</li><li>In terms of users, the online casual gaming sub-segment, at 420 million gamers in FY21 accounted for ~97 per cent of the total gamers in India and is expected to maintain this share by FY25 going ahead</li><li>The segment is significantly under indexed on monetization with lower ARPUs as compared to the gaming markets such as Indonesia, Malaysia and South Africa, which are comparable in terms of the per capita GDPs.</li></ul>Key Growth Drivers for the gaming industry <ul><li>Macro factors like increasing smartphone penetration, internet penetration, young population and adoption of digital payments adoption</li><li>Overall growth in digital consumption sophistication, which has helped online gaming become a mainstream entertainment option</li><li>Supply side factors such as increase in supply of world class titles, games with localized content, new features such as multiplayer and social elements added to games, and an increase in investor interest at large.</li><li>Further, COVID-19 induced lockdowns in 2020 was a tipping point in terms of online casual gaming consumption, with most metrics such as MAUs, DAUs, Average session times and even paid user conversion rates seeing strong traction.</li></ul>Key challenges faced by the online gaming segment <ul><li>Low average revenue per paying user (ARPPU): The ARPPU of online casual gaming in India is ~USD 2 (FY21), which is amongst the lowest in the world, given that India has the second largest base of online casual gamers in the world. This is owing to significantly lower penetration of consoles in India, which historically have instilled a culture of paying for games.</li><li>Lack of scale for Indian studios: Notmany Indian studios have made a mark on the global stage due to the emerging nature of the Indian market; low consumer spends on games and relatively lower game design capabilities. However, as monetisation improves in India, these aspects are likely to start getting addressed, evident by the success of some Indian titles during the lockdown 2020.</li></ul>Advertisement based monetisation <ul><li>The dependence on advertising as a means of monetization remains unique to India and is not likely to go away in the near to medium term as free to play games (With IAPs) dominate consumption in India.</li><li>Developers and publishers are increasing relying on tools such as rewarded/incentivized ads, to strike an optimum balance between monetisation and retention, and not hampering the overall user experience.</li><li>With an increasing share of time spent on gaming, advertisers/brands are looking at online casual gaming as a viable means to reach their intended target audiences. This is especially important as online casual gaming reaches the masses, across demographics.</li></ul>Consumer spends to evolve <ul><li>With a move up the gaming maturity curve for India, consumer spends; led by In App purchases (IAPs) are likely to see strong growth in the next 3-4 years.</li><li>With pricing of IAPs adjusted to Purchasing Power Parity (PPP), localisation of content, social aspects of gaming; and emerging opportunities around multi gaming platforms being able to devise monetary rewards; the consumer spends around online casual gaming is likely to see improved traction.</li></ul>Key evolving themes Cloud gaming: With the proposed launch of 5G services, cloud gaming has the potential to transform the gaming experience for a mass of users, taking device capabilities out of the picture. This is especially important for markets like India, with limited capacity to invest in hardware. Esports: Over the next five years, the esports segment is expected to grow rapidly due to increased interest from brands for sponsorship, publishers to promote games &amp; entry of new players across the value chain ranging from organisers to participating teams. The India esports sub-segment is expected to grow by CAGR 27 per cent over FY21-25 to reach a size of INR 5.7 billion Game development outsourcing can help resolve many challenges pertaining to cost, talent and time to market Artificial Intelligence in casual gaming: AI is being extensively used across game development (using AI generated storylines), player engagement, interactive experiences across gameplay, and personalization of each gamer’s journey with games. Satya Easwaran – Partner and Head of Technology, Media &amp; Telecom, KPMG In India commented “Our report - Beyond the tipping point – A primer on online casual gaming in India aims to simplify the multilayered ecosystem of the world’s second largest online casual gaming user geography. Poised at a 3X growth in revenues between FY21-25, we have been privy to the keen interest from corporates and investors who want to ride the incredible wave of opportunity that the business of online casual gaming has to offer. He further added “Having seen rapid growth in the last five years on account of the growth in digital infrastructure in the country coupled with the availability of leading titles, India’s online gaming segment is now a serious business with India’s gaming market being overwhelmingly mobile first.” Girish Menon, Partner and Head, Media and Entertainment, KPMG in India adds “The online casual gaming sub-segment in India has emerged as the largest in terms of consumption amongst overall online gaming, with close to 420 million gamers engaging in online casual gaming in FY21”. Menon says “Online casual gaming saw its tipping point in 2020, with consumption and engagement at an all time high. The growth potential of this sub-segment is immense, with improve monetisation helping the growth of the developer and publisher ecosystem, resulting in the likely emergence of players of scale. Both consumer spends and advertising based monetisation, which is unique to India, are likely to see strong traction, with India’s movement up the maturity curve and , supply of world class titles, the uptake of rewarded/incentivized ads and localisation of gaming titles being the key enablers. Further, with the emergence of ecosystem enablers such esports and game streaming, online casual gaming is likely to appeal to the masses and professionals alike.” Lastly, with technologies such as cloud gaming on the anvil and the adoption of latest AI/ML led technologies, online casual gaming in India is serious business, both for the players in the ecosystem as well as the investors. We envisage the online gaming segment to be amongst the largest segments of the M&amp;E industry in India in the years to come, garnering a share of both the time, and the wallet of the Indian digital billion”. Overall, the opportunities far outweigh challenges for online casual gaming in India. COVID-19 was the tipping point for the segment, and we see this segment amongst the fastest growing amongst the M&amp;E industry in India. It surely is interesting times for the online casual gaming ecosystem in India.

Advertising revenues in the casual gaming segment aggregated Rs 36 billion in FY21 and is expected to grow at a CAGR of ~29% to Rs 99 billion by FY25: KPMG Report

<ul><li><keyword id="3306712" type="COMPANY" weightage="20" keywordseo="online-fantasy-sports">Online Fantasy Sports</keyword> (OFS) operators’ gross revenues stood at INR 2400+ crore in FY20 as compared to INR 920+ crore in FY19, an increase of 3X over a period of 12 months</li><li>OFS operators contributed taxes to the tune of ~INR 750 Cr in FY20, a significant jump of 4X from INR 200 Cr in the FY19</li><li>~35-40% online transactions on OFS platforms are through RuPay or Unified Payment Interface (UPI)</li><li>~50% of transactions on OFS platforms were initiated from Tier 2 and Tier 3 cities in India substantiating deep connection of OFS within the country</li><li>~INR 14,000 Cr was paid out in the form of winnings and cash bonuses/promotional credits in FY20</li><li>A survey by KPMG with 750+ respondents found that users consume more sports when they engage with OFS platforms</li></ul><keyword id="9545140" type="COMPANY" weightage="20" keywordseo="the-federation-of-indian-fantasy-sports">The Federation of Indian Fantasy Sports</keyword> (FIFS), India’s first &amp; only self-regulatory industry body for Fantasy Sports (FS), today unveiled the findings of a report titled ‘Business of Fantasy Sports’ in collaboration with KPMG, at its flagship event FIFS GamePlan 2020. According to the FIFS-KPMG report, OFS operators’ gross revenues stood at INR 2,400+ crore for the FY20 as compared to INR 920+ crore in FY19 an increase of almost 3X over a period of 12 months. Indian OFS platforms have shown a rapid increase in their user-base YoY, growing from 2 million in 2016 to 90 million in 2019. Similarly, the number of OFS platforms in India has increased from less than 10 operators in 2016 to 140+ operators by the end of 2019. The OFS market recorded a CEA (Contest Entry Amount) of over INR 6,000 crore in FY19 and more than doubled to INR ~16,500 crores in FY20, at a growth rate of 167 per cent over FY20. The growth in FY20 is despite COVID-19’s impact on loss of CEA and revenues for the last 15 days of March 2020. Every rupee of revenue earned by the Indian OFS platforms translates into revenue for its supporting industries; thereby resulting in indirect topline growth for these service providers. Indian OFS platforms are also contributing to the overall growth of the Indian economy by paying GST, TDS on winnings, through sponsorships, in attracting FDI, in executing advertising campaigns, building IT infrastructure and incremental earnings for OFS winners, among others. Furthermore, close to 50% of transactions on OFS platforms in 2019 were initiated from Tier 2 and Tier 3 cities in India, thereby promoting digital payments literacy and adoption. The report further deep dives into the symbiotic relationship between real-life sports and fantasy sports. A dipstick survey with 750+ respondents found that for 55% of the respondents, the engagement with fantasy sports increases the consumption of real-life sports. Further, over 65% of the respondents indicated that there is a direct increase in the time spent in analyzing, watching and reading about Sports once they start participating in online fantasy sports. Besides increasing sports consumption among sports fans, fantasy sports also supports the sports ecosystem by sponsoring live-sporting events, across Cricket, Football, Basketball, Volleyball etc., by partnering with sporting personalities and giving back to sports via philanthropic initiatives. Due to the rapid growth of OFS, a new segment of the fantasy research ecosystem is also fast emerging across different digital platforms. Talking about the growth of the fantasy sports industry in India in his speech at GamePlan 2020, Amitabh Kant, CEO, NITI Aayog, said, “I have very keenly followed the growth of Indian fantasy sports industry as a supporter of technology and good governance. I am a long term believer that India must become a global champion of the fantasy sports industry. Sports across all facets, including fantasy sports, could well be a game-changer for employment and career opportunities. Given our Government’s initiatives like ‘Digital India’ and ‘Startup India’, I believe that we can harness the power of fantasy sports and create a robust sports ecosystem to boost its growth in the next few years. Post pandemic I am confident that the industry will not just rebound but will lead the way for sustainable technology-enabled growth secured by good governance.” Commenting on the report findings, John Loffhagen, Chairman, FIFS, said, “The COVID-19 impacted the Indian OFS industry in FY21 with sports matches across the globe cancelled to ensure player &amp; staff safety. Specific to India, with IPL getting postponed, ~30-40% of the revenues for most of the OFS operators were impacted for the quarter. As real-life sports is making a promising return, Indian sports fans are in for a non-stop sporting action for 8-9 months. As most of these matches will be held without an in-stadia audience, we are sure that fantasy sports being a highly immersive fan engagement platform will experience a strong surge in demand by the Indian sports fans.” Girish Menon, Head of Media and Entertainment and Partner, <keyword id="146882" type="COMPANY" weightage="20" keywordseo="KPMG-India">KPMG India</keyword>, further added, “Online fantasy sports in India has seen rapid growth, reaching a revenue size of INR 2,470 crore in FY20. This growth has also contributed immensely to the overall ecosystem around fantasy sports including online payment platforms, tech vendors, data analytics, etc. and has had a positive impact on the consumption and growth of the overall sports landscape in India. While COVID-19 may result in a temporary blip in the upward trajectory of the fantasy sports segment, the medium to long term growth prospects of the segment remain robust, with the gradual return of international sport. Further, in a post COVID world, with social distancing measures in place, fantasy sports is likely to play an increasingly important role in connecting fans to their favourite sports and increasing fan engagement.” Key findings from the KPMG survey conducted among 750 respondents: <ul><li>For 55% of the respondents, their engagement with sports increased once they started engaging with fantasy sports</li><li>32% of all fantasy sports users, engaged with more than one sport on the platform</li><li>Over 65% of these respondents indicated that there is a direct increase in the time spent in analysing, watching and reading about the sport once they start participating on fantasy sports online</li><li>Fantasy Sports users who engaged with OFS platforms more than 4 times a week spent an average ~215 minutes/week watching sports in comparison to users who engaged less than 4 times a week and spent ~160-180 minutes/week watching sports</li><li>16% of the OFS users categorically mentioned that the key motive of watching the sports leagues is to track the performance of their OFS teams</li><li>77% of fantasy sports users are engaged in cricket contests followed by Football at 47% &amp; Kabaddi at 9%</li><li>~15-20% of the active users on OFS platforms are paid-users, which is significant given the relatively younger vintage of the industry as compared to other digital businesses</li></ul>

Indian Fantasy Sports contributes Rs 750 crore in FY20: Report

<ul><li>The 12th edition of <keyword id="50041" type="COMPANY" weightage="20" keywordseo="KPMG">KPMG</keyword>'s report on the <keyword id="176124" type="COMPANY" weightage="20" keywordseo="Media-Entertainment">Media &amp; Entertainment</keyword> sector examines the performance of the industry during a particularly challenging period.</li><li>The report reveals that digital advertising spends are now set to overtake those on TV by FY21, which is an important milestone and turning point in the evolution of M&amp;E in India. </li><li>It also states that the M&amp;E sector should recover to its current levels and post a 33% growth in FY22 (following a contraction of 20% in FY21), which still implies a loss of around two years of growth. </li></ul> KPMG in India has launched the 12th edition of its Media and Entertainment (M&amp;E) report, titled ‘A year off script: Time for resilience’ that examines the performance of the M&amp;E sector during a particularly challenging period. India was already experiencing a slowdown in economic activity even prior to the outbreak of COVID-19 in March, and the onset of the global pandemic and ensuing lockdown dealt a severe blow to the Indian economy. The M&amp;E sector has been affected but to varying degrees: outdoor entertainment formats (films and events) and traditional media (print and TV to some extent) have been badly impacted as people stayed indoors and advertising spends dried up. Digital advertising, OTT and gaming fared much better, with massive spikes in <keyword id="4654667" type="PERSON" weightage="20" keywordseo="Digital-Consumption">digital consumption</keyword> during the lockdown across geographies and socio-economic classes. Digital advertising spends are now set to overtake those on TV by FY21, which is an important milestone and turning point in the evolution of M&amp;E in India. As <keyword id="8003653" type="PERSON" weightage="20" keywordseo="Satya-Easwaran">Satya Easwaran</keyword>, Partner and Head, Technology, Media and Telecom, KPMG in India says, “The distinction among segments of M&amp;E has become more pronounced with the experience of the lockdown. Marketing spend has moved perceptibly towards digital media and away from traditional segments like print, radio and to some extent TV. A greater reliance on subscription and other paid options as well as the development of a credible digital business model is going to be inevitable for these traditional media segments.” Organisations face a multitude of challenges and competing priorities but based on a survey of CXOs conducted by KPMG in India, customer focus and revenue growth are expected to drive digital-first initiatives over the near term within organisations, with cost reduction also emerging as important to traditional media segments. <keyword id="3520955" type="PERSON" weightage="20" keywordseo="Girish-Menon">Girish Menon</keyword>, Partner and Head, Media and Entertainment, adds “There will be a deeper integration of digital technology across the M&amp;E value chain – from content production to distribution. Technology adoption could however face some challenges in terms of skill development and the shift to a digital-first mindset but will result in operational cost savings and potentially lower lead times over the longer term.” Finally, the M&amp;E sector should recover to its current levels and post a 33 per cent growth in FY22 (following a contraction of 20 per cent in FY21), which still implies a loss of around two years of growth. The two areas that offer encouragement are the continued economic growth of Bharat and the universal acceleration of digital adoption among users across geographies and SECs. As per our revised estimates, India could be home to a billion digital users by 2028 rather than the earlier projected 2030 timeline. There have been several structural changes to digital behaviour on account of the experience of the lockdown resulting in a new homogeneity among users, and it is our belief that many of these changes will translate into a more democratic and sophisticated digital citizenry within the country.

Digital advertising spends set to overtake TV spends by FY21: KPMG Report

<ul><li>The report highlights that media consumption overtime has become income inelastic, however the current environment could result in a dip in media consumption in the near term; and also foresees key trends across Television, Print media, Films, OTT platforms during COVID along with the recovery time for the same. </li><li>At-home entertainment options (digital, TV, gaming) to see an upswing as ‘lockdown behaviour’ results in habit formation.</li></ul>KPMG has released a report titled ‘<keyword id="8763838" type="UNKNOWN" weightage="20" keywordseo="covid-19">COVID-19</keyword>: The many shades of a crisis - A media and entertainment sector perspective’ which discusses the impact of the novel virus on the Media and Entertainment industry. The report highlights that media consumption overtime has become income inelastic, however the current environment could result in a dip in media consumption in the near term; and also foresees key trends across Television, Print media, Films, OTT platforms during COVID along with the recovery time for the same. Furthermore, the report highlights that due to COVID-19, traditional media could face some challenges in the near to medium term, and there is likely to be a long-term upward shift in the integration of digital technologies into our everyday lives with media and entertainment being an immediate beneficiary. Speaking on the ongoing situation, <keyword id="8003653" type="UNKNOWN" weightage="20" keywordseo="Satya-Easwaran">Satya Easwaran</keyword>, Partner and Leader - Markets Enablement, Technology, Media and Telecom (TMT), KPMG in India says, “The COVID-19 pandemic has resulted in a drastic cut in advertising expenditure across all media. However, with people being homebound, consumption of media and entertainment – and digital media in particular – has seen considerable growth. Post crisis, we anticipate an even greater integration of technology into our everyday lives with a marked digital progression of Indians across socio-economic classes. Monetisation however might remain a challenge in the near term.” Girish Menon, Partner and Leader - Media and Entertainment, KPMG in India said “The COVID-19 experience is likely to result in a long-term upward shift in the integration of digital technologies into our everyday lives, with India’s ‘digital billion’ trajectory likely to accelerate materially. We expect greater affinity to be seen for at-home entertainment with subscription models, cord-shaving and streaming to larger screens seeing exponential pick-up in the near to medium term. Outdoor entertainment options including – films, events, theme parks – particularly in COVID-19 hotspots could see lingering risk aversion even in the medium term. With monetisation, particularly ad-spend, under pressure, the focus for M&amp;E companies in the near to medium term would be on cash management and profit protection with greater technology integration. Organisations might need to be risk focused and innovate existing business models and processes to survive and emerge stronger.” While traditional media could face some challenges in the near to medium term, digital media businesses have fared relatively better, albeit only on the consumption side. There is likely to be a long-term – upward – shift in the integration of digital technologies into our everyday lives, and media and entertainment will be an immediate beneficiary. This is likely to be true across socio-economic groups – i.e. for both India and Bharat. The differences could arise however with a more granular observation of individual behaviour, as we expect urban areas affected by COVID-19 to potentially show greater affinity for at-home entertainment, subscription content, cord-shaving and streaming to larger screens in the near to medium term. On the other hand, livelihoods of a large segment of Bharat have been severely affected by this pandemic, potentially making entertainment spends into an aspiration. Inequity and imbalance in consumption could even be exacerbated in our post-crisis reality. Below are the key highlights of the report: Insights into the crisis and its aftermath: <ul><li>Ad-spend pressures to linger on the back of weak economy and lower domestic consumption</li><li>Longer time lag to return to normalcy for weaker economic sections of the populations</li><li>Digital consumption to see rapid incremental growth with India’s digital billion trajectory likely to accelerate materially</li><li>At-home entertainment options (digital, TV, gaming) to see an upswing as ‘lockdown behaviour’ results in habit formation</li><li>Outdoor entertainment (films, events, theme parks) particularly in COVID-19 hotspots to see lingering risk aversion even in the medium term. ‘Pent-up’ demand behaviour among some sections of population may provide some respite</li><li>Delayed expansion plans though digital businesses aggressively target market opportunity</li></ul>Impact on the Media and Entertainment sector: <ul><li>Supply chain:</li></ul><ul><li>Innovations in content pipeline: A focus on building a stronger content bank may result in working capital being locked up across the value chain, leading to higher cash flow requirements</li><li>Innovations in delivery models: With outdoor entertainment and recreation facing challenges in the near term, innovative outreach and delivery models are likely to evolve</li><li>Greater emphasis on predictive analytics: Companies could place an increasing amount of reliance on Artificial Intelligence (AI)/ Machine Learning (ML) to predict consumer behavior in these uncertain times</li></ul><ul><li>Consumption:</li></ul><ul><li>India vs. Bharat dichotomy could likely widen</li><li>At-home consumption, particularly OTT and gaming, to see continued accelerated growth</li><li>Outdoor media consumption: M&amp;E segments such as films, events and theme parks are looking at a prolonged recovery cycle, owing to risk aversion towards social gatherings, particularly in COVID-19 affected cities and hotspots, which unfortunately includes some of the major cities</li><li>While India’s media consumption remains upbeat during the lockdown, indulgent expenses around purchase of latest hardware, technology upgrades etc. could be postponed for a while</li></ul><ul><li>Monetisation:</li></ul><ul><li>Longer timelines for ad spend recovery</li><li>Penetration of subscription based digital models to accelerate: Digital subscription revenues could see an upswing post COVID-19 as habit formation in terms of OTT video consumption sets in</li><li>Print will get a new lease of life</li><li>Medium term downside risk for outdoor entertainment segments: Aversion to social gatherings in the medium term (particularly in major COVID-19 hotspots) could result in lower footfalls and ticket sales for films, events and theme parks</li><li>M&amp;E services build on domestic opportunities: There is likely to be a greater emphasis on domestic markets in the services space, particularly in the animation and VFX segments, as global pipelines come under severe pressure</li></ul>Framework to help companies work through the transition to normalcy: <ul><li>Immediate focus for companies will be on value preservation and protection</li><li>Protection of the workforce: Focus first on the physical and mental well-being of the workforce with a gradual reintegration process. Time for leadership to deliver clear messages on organizational priorities and provide a fair assessment of the impact of the crisis on their business to employees</li><li>Stakeholder communication includes not just employees but also external parties including vendors, partners and customers</li><li>Identify short-term cash flow challenges and enable cost levers for savings opportunities</li><li>Medium term objective will be value creation</li><li>Agree and implement the recovery plan</li><li>Incorporate learnings from the crisis to streamline processes and potentially provide better insulation from such shocks</li><li>Devise tactical working capital projections in acknowledgement of the changed environment</li><li>Invest in upskilling teams to adapt to the new normal</li><li>Long-term vision will be value realisation</li><li>Carve-out of non-core businesses to unlock value</li><li>Identify strategically aligned inorganic growth opportunities</li><li>Develop deep and credible succession plans</li></ul>

KPMG India reveals how COVID-19 has impacted the media and entertainment industry

<ul><li>Even after the record growth witnessed by streaming services in India, the question remains whether these platforms can retain the massive lockdown gains </li><li>With streaming services under pressure to provide new content frequently and producers trying to not lose money in films, web premiers might be another new normal. </li><li>Moreover, a KPMG report suggested that OTT platforms should look at gaming as an extension to their ecosystem offerings. </li></ul>Streaming services are the only bright spot for the millions who are isolating at home during lockdown. With ample leisure time and fewer options, usage of streaming platforms surged. Most of the 35 streaming giants in India — <keyword id="3960758" type="PERSON" weightage="20" keywordseo="Amazon-Prime-Videos">Amazon Prime Videos</keyword>, <keyword id="6245082" type="UNKNOWN" weightage="20" keywordseo="ZEE5">Zee5</keyword>. Voot, Hungama, AltBalaji, MX Player — witnessed a record growth fueled by quarantine. The Big Boost During the lockdown, there was a 265% increase in OTT traffic since February last week — in spite of the drop from HD to SD, according to Internet Exchange operator DE-CIX. The five services that gained the most are Amazon Prime Videos, Netflix, Youtube, Zee5 and Hotstar. Disney+ — which was launched soon after India locked itself down —<a href="https://techcrunch.com/2020/04/08/disney-has-more-than-50m-subscribers/"> added 8 million users </a>within a week. Whereas, Netflix India — which was earlier losing to the homegrown market — too <a href="https://www.businessinsider.in/finance/news/exclusive-app-tracking-data-for-netflix-reveals-the-countries-where-usage-spiked-in-march-and-suggests-strong-viewership-heading-into-q1-earnings/articleshow/75162782.cms">saw at least an 8% growth in Q1FY20 driven</a> by its cheapest mobile online plan at ₹199. Zee5, a homegrown OTT platform, saw 36% growth during the lockdown. Whereas its foreign arm, <keyword id="7124509" type="UNKNOWN" weightage="20" keywordseo="ZEE5-Global">Zee5 Global</keyword> saw a 60% surge in users across the world including the Middle East and Canada. Alt Balaji, yet another homegrown platform, saw a 60% growth in its subscription. <table style="border-width: initial; border-style: none; width: 468pt; table-layout: fixed;"></colgroup></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">OTT services </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Change in viewership due to Covid-19 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Netflix India </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">+8% in Q1 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Zee5 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">+36% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Hungama Play </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">+20% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Eros Now </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">+70-100% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">MX Player</td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">130% surge on engagement </td></tr></tbody></table> A short-term spike or a long-term gain A<a href="https://rollingstoneindia.com/how-the-coronavirus-is-impacting-audio-and-video-streaming-in-india/"> Nielsen report</a> predicted that lockdown can trigger a 60% rise in content consumption in India. Even after the record growth witnessed by streaming services in India, the question remains whether these platforms can retain the massive gains post lockdown. Hence, when Netflix recently said it added a record 15.8 million paid subscribers globally, it also added that it is treating it as “<a href="https://techcrunch.com/2020/04/21/neflix-q1-earnings/">a short-term spike” and the growth will gradually decline. </a> A KPMG report, however, believes that OTTs are likely to see continued accelerated growth. "While the same levels of consumption may not be achieved once we overcome this pandemic, there is definitely a new and higher normal that is likely to be established when it comes to time spent on OTT platforms," Girish Menon, Partner and Head, Media and Entertainment, KPMG in India told Business Insider. Moreover, Menon believes consumers are likely to develop a habit of consuming video online during lockdown which would later drive subscription growth. However, According to Karan Bedi, MX Player, OTT platforms might witness some immediate dip post lockdown, but the overall base and average time spent would continue the rise. With shooting of new TV series being delayed and movie theatres closed, services with large, legacy libraries and fresh content, have an inherent advantage. “A new normal has been witnessed as consumers adapt to the evolving situation of the pandemic. We feel this pattern will stay as it is in the post-COVID-19 era as well and perhaps there will be some incremental change in the overall user growth,” Aparna Acharekar, programming head of ZEE5 India. Ferzad Palia, who heads Voot Select in India too thinks the same. Rohit Paranjpe who heads SugarBox Networks believes new content will continue to enthuse people. The pressure on OTT services to release new content more frequently may also go up. Also, OTT players too should not be happy just retaining users and will have to engage them more. Apart from films, KPMG in a report suggested OTT platforms look at gaming as an extension to ecosystem offerings. “OTT will look to bring their consumer’s value in other areas: from aggregating other third party content providers who are not competing with them to promoting and pushing other adjacent services, like fitness and food delivery apps, and education platforms,” said Lior Friedman, VP - global partnerships and strategy at Amdocs Media. Directly onto OTT platforms With streaming services under pressure to provide new content frequently and producers trying to not lose money in films products, web premiers might be a new normal. Lakshmi Bomb featuring Akshay Kumar might release on Disney+Hotstar. MUBI is premiering Pablo Larrain’s film ‘Ema’ in India, UK and Ireland on May 2. Whereas, Zee5 is also considering premiering movies directly on its platform in the near future. AB Anni CD will be yet another film to be released directly on Amazon Prime Videos. Akshay Bardapur, the producer of the movie that stars Amitabh Bachchan said, “We didn’t want to keep audiences from watching two megastars. Also, it made sense to recover losses by selling content to the OTT.” But big-budget movies are preferring to hold back. Recently, the makers of Ranvir Singh starrer movie ‘83 said they will release the film in theatres first even <a href="https://mumbaimirror.indiatimes.com/entertainment/bollywood/ranveer-singhs-83-to-not-release-on-ott-platforms-makers-aim-for-theatrical-release/articleshow/75401861.cms">if they had to wait for six or nine months. </a> “While producers of movies that have a reasonable budget may experiment with releasing movies directly on OTT platforms or opt for a pay-per-view model, bigger films are unlikely to be released until later this year or next year,” says Neeraj Roy, founder and CEO of Hungama Digital Media. See also: <a href="https://www.businessinsider.in/entertainment/news/cinema-halls-may-not-open-in-india-until-june-end/articleshow/75407053.cms">Cinema halls may not open in India until June end</a> <a href="https://www.businessinsider.in/entertainment/news/lockdown-watchlist-want-to-binge-watch-a-show-that-lasts-a-week-try-these-long-running-shows-on-netflix-amazon-prime-disney-hotstar-and-others/articleshow/75173116.cms">Lockdown Watchlist: Want to binge-watch a show that lasts a week? Try these long-running shows on Netflix, Amazon Prime, Disney+ Hotstar and others</a>

Streaming platforms who are on a new high — are hosting web premiers and might even expand to gaming

BCCL<ul><li>Digital release of the films might be another component of the ‘new normal’ that experts anticipate post-COVID-19. </li><li>While big production houses may be able to afford to wait it out until the lockdown ends, medium and small budget film producers may not have an option but to release their films on OTT platforms. </li><li>Business Insider spoke to media and entertainment experts about how sustainable is the option of releasing films directly onto the streaming services. </li><li>Indian film producers are likely to make only half the profit through digital release.</li></ul>With cinema halls closed, streaming platforms are chasing film producers premiere films on their platforms during the nationwide lockdown. These OTT platforms have been under pressure to provide new content frequently to sustain user growth. It’s not just OTT platforms but film producers too, who are trying to not lose money by opting for a web premier. Some upcoming films like <keyword id="3371986" type="PERSON" weightage="20" keywordseo="Lakshmi-Bomb">Lakshmi Bomb</keyword> featuring Akshay Kumar are in talks with Disney+Hotstar for a release. Even <keyword id="6245082" type="UNKNOWN" weightage="20" keywordseo="ZEE5">Zee5</keyword> is considering premiering movies directly on its platform in the near future. On the other hand, some are holding out — like Kabir Khan’s <keyword id="6411340" type="UNKNOWN" weightage="20" keywordseo="83">83</keyword>, despite <a href="https://www.newindianexpress.com/entertainment/hindi/2020/apr/28/ranveer-singhs-83--not-headed-to-digital-platforms-makers-clarify-2136111.html">receiving a ₹143 crore offer. </a> Digital release of the films might be another component of the ‘new normal’ that experts anticipate post-COVID-19. Business Insider spoke to media and entertainment experts about how sustainable is the option of releasing films directly onto the streaming services. Will web premiers be the new normal? While big production houses may be able to afford to wait it out until the lockdown ends, medium and small budget film producers may not have an option but to release their films on OTT platforms. “With Box Office collections continuing to account for a lion’s share of a film’s overall revenues, some producers may choose to bide their time and wait for the situation to normalize, rather than settle for potentially lower revenues by releasing on an OTT platform” Girish Menon, Partner and Head, Media and Entertainment, KPMG in India told Business Insider. Film critic and senior entertainment journalist Latha Srinivasan believes producers who are looking to make a profit on their films are aware that streaming services might not be able to match the returns of a theatrical release. Producers in India first release the films in the theatres and bag an offer for streaming it online two to three months after the premier. However, once the film is released on OTT platforms audiences will no longer flock to the theatre to watch the same film, Srinivasan pointed out. No gain no loss <div type="image" title="19685ADE-A79D-4CAF-AA60-62A0B55DB7B1" msid="75563988" hostid="261"></div> (BCCL). Even those producers who are considering a digital release aren’t going to make any profit out of it. Just like film producer Akshay Bardapurkar — whose film AB Aani CD featuring Amitabh Bachchan recently released on Amazon Prime — who opted for a digital release to recover losses. “The calendar is likely to get bunched and smaller films will have a tough time finding a screen. Screens will be a big problem. Therefore, some of the smaller movies may decide that it is better to release films on OTT platform,” Jehil Thakkar from Deloitte India told Business Insider. Once theatres open, footfall will continue to be tempered even if people decide to head out and go for a movie. The audience will also be very selective about which movie to watch. Thakkar believes, the trend will ultimately depend on how much OTT platforms are willing to shell out in order to purchase a film. A producer would expect at least 60% return to be on even keel with expected returns from the box office. At the current rate, Indian producers would earn at least 25% to 50% less on OTT platforms in comparison to releasing their movie across theatres in India as well as overseas. “For example, a film of Stree, Badhai Ho and Raazi’s calibre would easily lose between ₹35 to 55 crores per film by avoiding the theatrical release. But there is no option for a few producers, as once the theatres, open windows for releasing films even of A-list actors would be very limited,” Murlidhar Chhatwani, Managing Partner, Panorama Studios Distribution The existential crisis of cinema halls in India <div type="image" title="250E5197-081D-4523-B580-FFD3FEEB39D6" msid="75563911" hostid="261"></div>Tickets counter of Fun cinema in Hinoo area wears a deserted look after state government announced a closure of all major public places including cinema halls amid corona scare in Ranchi (BCCL) Apart from big producers, theatres also don’t want films to be released on OTT platforms as it would eat their business. On April 5, Multiplexes Association of India urged all producers and directors to refrain from the digital release of the film and wait until the theatres are open again. Cinema halls in India are <a href="https://www.businessinsider.in/entertainment/news/cinema-halls-await-for-behind-the-screens-as-they-lose-150-crore-a-week/articleshow/74689696.cms">losing ₹150 crore a week</a> ever since India shut down 9500 screens over coronavirus outbreak. In South, Tamil Nadu Theatre Owners Association (TNTOA) have threatened 2D Animation — a production house of actor Surya — after it reportedly made a ₹9 crore deal to release film on Amazon Prime. Theatres are banking on post covid-19 release of films in large numbers for the revival of their business. See also:<a href="https://www.businessinsider.in/entertainment/news/cinema-halls-may-not-open-in-india-until-june-end/articleshow/75407053.cms">Cinema halls may not open in India until June end</a> <a href="https://www.businessinsider.in/entertainment/news/disney-hotstar-amazon-prime-videos-zee-5-gained-a-lot-this-lockdown-and-it-might-not-be-temporary-either/articleshow/75443378.cms">Streaming platforms who are on a new high — are hosting web premiers and might even expand to gaming</a>

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