According to Redseer, India’s digital media and entertainment business, which is presently valued at $12 billion, is primed for rapid growth, with forecasts of tripling by 2030.
The present growth trajectory is being fueled mostly by an increase in non-real money gaming (on RMG) and the widespread use of over-the-top (OTT) platforms in both audio and video formats. Despite obstacles such as a decrease in digital advertising investment and regulatory changes affecting the RMG sector, the industry’s trajectory remains positive.
A diversified user base characterizes India’s internet customer population. According to Redseer, a large group of 450-500 million explorers leads the way, followed by 300-320 million transactors and a smaller group of 35-40 million seasoned users.
The fiscal year 2023 saw a substantial improvement in the media and entertainment scene, particularly in terms of paid user growth and average revenue per paying subscriber (Arppu). Subscription bundling, inexpensive plans, micro-payment alternatives, and pay-per-view services have all contributed to paid user growth of up to 90% across different categories.
However, the industry is not without its difficulties. Customer acquisition expenses are high, and user retention rates are poor. Innovative monetization structures, an emphasis on localized and regional content targeting tier-two and beyond audiences, and techniques such as releasing the first episode of the original series for free on OTT platforms are potential long-term plans to address these concerns.
Significant growth was witnessed in the field of audio series and audiobooks, with prominent platforms in India reporting a ninefold rise in FY23. The growth in paid users, compelling and immersive content, and flexible payment choices are credited to this spike. The increasing availability of immersive and localized material, along with reasonable subscription pricing, has significantly aided the rise of audiobooks.
The gaming industry is also undergoing a tremendous shift, with a community of 150 million mid-core or core players expected to emerge by 2023. This group, which is mostly shifting from casual gameplay, is increasingly engaged in in-game purchases for accessories and costumes, resulting in a 40% increase in paid gaming users. This move from casual to adult gaming is also fueling an increase in gaming livestream viewing.
Short-form video (SFV) platforms in India have 250 million users, with two-thirds coming from tier-two and lower cities. Notably, about 40% of these visitors are also engaged online transactors, creating an ideal environment for brand and advertiser monetization. This is an excellent chance to reach a larger audience in tier-two locations.
According to the Redseer analysis, monetization on Indian SFV platforms is still in its infancy, presently confined to advertising income and influencer marketing.
