Online streaming overtakes film industry as primary revenue source: Report

Receiving less than a quarter of total investments in the video industry, premium online video-on-demand drives half of the sector’s revenue growth in India, reveals a recent study by Media Partners Asia and Prime Video India. Since 2017, online video, excluding sports, has seen a threefold increase in content investments, highlighting a shift in industry preference from television to OTT platforms.

Online streaming, moreover, has overtaken the film industry as a primary revenue source, as production firms garner 1.5 times greater revenue from the former than net earnings from theatrical box office sales. The study highlights the growing popularity and profitability of streaming platforms are fuelling the video industry's overall growth. The report highlights India's online video industry became a lifeline for the film sector during the COVID-19 pandemic, with over 300 digital-first releases between 2020 and 2022, offering essential cash flow while theatres were closed. Further, allied industries such as telecom operators have experienced the positive impact of video streaming, with video being the primary driver of their data consumption, representing over 70% of their data traffic.

India ranks among the top three markets for net new user additions and revenue growth for both Amazon and Netflix, the two most significant players of the many streaming platforms. And despite these rising revenues for streaming platforms, per capita annual content investment in India remains disproportionately low compared to other countries.

With a massive multiplier effect on the country’s creative economy, the online video industry can potentially create over 3.3 lakh jobs as demand for specialised skills such as VFX, animation, subtitling, and dubbing surges by 2028. An unprecedented content boom powering the streaming revolution has generated almost 1.74 lakh direct and indirect jobs in 2023 alone.

The report highlights while OTT platforms are increasingly recognising the need for female professionals, leading to more women writers, cinematographers, and editors and a rise in women-led shows like “Delhi Crime,” “Maharani,” and “Dahaad,” industry disparities persist.

“The streaming VOD sector is not just reshaping entertainment; it's redefining India's place on the world stage,” the report says.

As OTT platforms produced 1500 original titles between 2016 and 2023, these premium online video-on-demand providers showcase India’s cultural diversity to a global audience. Indian streaming content, reflecting diverse regions beyond the major metros of the country, is poised not just to become a significant player in global entertainment, akin to K-pop and Japanese Anime, but also to win international awards. Leading services like Prime Video, Netflix, Disney+ Hotstar, and ZEE5 are advancing India’s soft power globally, with shows like Netflix’s Heeramandi, and Prime Video’s Mirzapur gaining prominence.

While the report signals a positive outlook for India’s video industry, it highlights several challenges such as “expanding modern production facilities beyond major urban centres, fostering collaboration for infrastructure development, cultivating technical talent through innovative training programs and academic partnerships, and intensifying efforts to combat piracy and protect intellectual property.”