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How telco partnerships spurred the growth of Netflix, Amazon Prime Video, ALTBalaji, and others in India

In 2018, OTT services in India went mainstream. Much of the growth witnessed by Netflix, Amazon Prime Video, Eros Now, and others was due to content distribution tie-ups between them telecom operators and device manufacturers.

It’s one thing to own content, quite another to make it accessible. And, if content is not accessible, what really is its point? In the early days of satellite television in India, broadcasters had to forge distribution partnerships with local cable operators and pay them hefty “carriage fees” to make their content available to millions of TV households. Then came the DTH era, and the broadcaster-distributor partnership became slightly more formal, carriage fees were better structured, under-reporting reduced, ARPUs improved, and it was a win-win for both parties.

Enter OTT, or internet-led content services.

While the core game remains the same – because distribution continues to be critical for all content creators – the players have changed. The action has now shifted to video-streaming platforms such as Netflix, Amazon Prime Video, Hotstar, Eros Now, JioTV, and others. Distribution is what makes them reach the masses, be watched, heard, and talked about.

In 2018, partnerships between these OTT players and content distributors peaked. While paid global services like Netflix and Amazon Prime Video rode on the back of India’s expansive telecom infrastructure – one of the largest in the world – to establish their presence, telcos themselves had to bundle “content offerings” to woo their increasingly video-obsessed customers.

This not only led to an explosion in the country’s mobile data consumption, but also brought about a definitive change in users’ video-viewing habits, created a demand for original India-focused shows, and sowed the seeds of a robust “digital content ecosystem” which, BCG estimates, would be worth $5 billion in the next five years. And, rural India would play a big part in it.