India’s over-the-top (OTT) market is slated to nearly triple in size between now and 2023. The market is growing at a 21.8% compound annual growth rate (CAGR). It is projected to witness a growth from Rs4,464 cr in 2018 to Rs11,976 cr, according to a new report by PricewaterhouseCoopers (PwC).
The revenue share of the music-radio-podcast segment in India is projected to grow at a higher speed compared to world standards. While the share of Entertainment and Media (E&M) revenue in this segment globally was valued at 4.6% in 2018, it is expected to fall to 4.3% in 2023. India on the other hand, is predicted to see a growth in the current share of 2.2% to 2.4% in 2023.
According to PwC, the growth rate of the music-radio-podcast segment will also see an upward curve. It is expected to grow at 13.54% CAGR by 2023 compared to the global growth rate of 3.2% CAGR.
At 96% India has the highest rate of smartphone users who use their phones to consume music. With access to compatible multimedia capable devices and improved network bandwidths, a completely new generation of online music listeners have emerged in India. The number of online music listeners is expected to grow to 273 million by March 2020.
The growing adoption of smartphones and smart speakers will make all forms of audio increasingly accessible to listeners in the coming years,” PwC said, adding that “ease of voice search” will also boost revenues over the next five years.
The continuous growth of digital infrastructure has paved the way for a 50% growth in audio streaming to 150 million listeners in 2018 (excluding YouTube). Thanks to audio OTT platforms, the Indian recorded music industry brought in INR 1068 cr with revenue growth (year-on-year) above 24.5%.
However, only 1-1.5 million listeners paid for music, generating INR 800 million in revenues. The same view has been corroborated by Amarjit Singh Batra, MD, Spotify India in a recent interview saying only 1% of the users in India pay for music streaming services. The challenge is to convert the huge number of unpaid users into paid subscribers.
During the launch of the Global Music Report 2019, Music Plus asked Adam Granite, Executive Vice President, Market Development, Universal Music Group about how does he perceive the music streaming dominating the Indian music market.
Adam said, “India is a very diverse and an exciting market. The global music industry looks at India as a high potential market. Currently the percentage of paid subscribers is far less compared to developed markets. We would like to see this change. This change wont happen overnight.”
With the extremely competitive price market and the increase in quality content, the percentage of paid subscribers can be expected to rise sooner than later.