As originals dry up, OTTs face subscriber test

India’s once-booming streaming landscape is showing signs of exhaustion. Following a pandemic-fueled wave of original content, platforms are retreating. The amount of Indian original content, which was once on a meteoric rise, has stagnated, raising questions about the sustainability of the streaming model in the country.

According to a report by Media Partners Asia (MPA), the number of original Indian titles has declined from 225 in 2021 to 199 in 2022, with only a slight increase to 206 in 2023. This slowdown reflects growing margin pressures and more accurate data on what content is actually engaging audiences. Content creators are also warning that the return of some films to theatres, which had previously gone straight to digital, is further reducing output – a move that could challenge OTT platforms’ ability to retain and attract subscribers as the frequency of new titles declines.

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“Platforms need to release new, engaging and fresh content at regular intervals. Existing and new subscribers should see the value in continuing to subscribe to the platform. And only through such strategies will subscribers feel that they have got value for their money,” said Rajat Agrawal, Director and Head of Content Distribution at Ultra Media & Entertainment Group, which owns Marathi OTT platform Ultra Jhakaas.

Agrawal acknowledged that some platforms have cut back on the number of new releases and noted that streaming repetitive content creates viewer fatigue, discouraging new and potential subscribers from signing up.

Soumya Mukherjee, COO of Bengali streaming service Hoichoi, confirmed that the number of original content across all platforms has declined, though Hoichoi has maintained a steady volume of around 30 new releases a year. “Weekly engagement on any OTT is driven by user acquisition and retention, which boils down to the right content strategies,” Mukherjee added.

A senior executive at a content studio noted that in 2021, during the height of the pandemic, there was a significant increase in content investment as many films went straight to OTT, bypassing closed or economically unviable theaters.

“In the following years, the US recession impacted OTT spending in India, and platforms also gained a better understanding of their target audience. They realised that the returns on paid subscriptions were lower compared to before, when they were spending more freely in dollar terms,” ​​the executive said.

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This shift in investment patterns is evident. Online video content investment in originals peaked at $529 million in 2022 but fell to $479 million in 2023. It is projected to recover slightly to $527 million in 2024, according to data from MPA, an independent provider of research, advisory and consulting services to the media and telecommunications sectors in Asia-Pacific.

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The executive explained that services are now balancing the release of large-scale shows at a lower frequency with lower-budget shows, often streamed for free with ads, to maintain content pipelines. “Many platforms have also realized that a wide release of a movie after its theatrical release can attract more subscribers than a web original, so is there really a need for so many shows?” the executive added.

Partho Dasgupta, managing partner at Thoth Advisors and former CEO of BARC India, said that apart from Netflix and Amazon Prime Video, most platforms are facing financial difficulties.

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“Nobody has a lot of cash and there will be a problem in terms of attracting new customers through new shows. While the core audience may not be affected, the fringe segment is likely to disappear,” Dasgupta said, adding that the strategy of launching smaller-scale shows that air for free with ads could help ease some of the pressure.