On Friday, September 24th, Amazon announced the launch of Prime Video Channels. This video entertainment marketplace resells premium content from multiple partners and makes all their content available via its Prime Video app.
Prime Video Channels, for its rollout in India, has collaborated with eight content partners. The list includes:
- Lionsgate Play
- Manorama Maz
- Shorts TV
A single billing mechanism will allow users to get add-on subscriptions, paying only for the services they choose at a discounted rate, and it will also add more OTT brands to the list soon.
Notably, India is the 12th nation to host Prime Video Channels after the US, UK, Japan, and others.
Why did Amazon Prime Video decide to be a Content Aggregator?
With eight subscription-driven video-on-demand platforms available on its website and app, Amazon Prime Video has become a content aggregator in India. The offering went on last Friday.
“Our journey in the country over the last four-and-a-half years taught us that users are yearning for content. Even though we are serving our own range of exclusive and original content, there are demands for programs that go beyond those. Acting as a marketplace for entertainment seems to be an ideal next step for us,” stated Amazon Prime Video, India’s Country Manager, Gaurav Gandhi (1).
Gandhi further added that the OTT platform does not look at the move as allowing easy access to peers because these are early days in the streaming market.
In addition to the OTT partners getting Amazon’s distribution and reach, the US-based company also handles all the technical and back-end responsibilities, added Gandhi. The channels tag would be available as a separate category in the Prime Video platform.
“With the rollout of Prime Video Channels, we now take the next leap in our journey to entertain India by offering a video entertainment marketplace, the first of its kind in the country, which would delight our customers by offering them even more entertainment choices. It will also benefit the OTT Channel partners who have joined hands with us to leverage Prime Video’s distribution, reach, and technological infrastructure.”
Gandhi further pointed out, “Prime Video Channels arrived in the country after successfully launching in 11 other countries. Our choice of OTT partners for Prime Video Channels reflects our discerning and diverse customers’ entertainment needs and interest areas. The rollout marks our effort to grow the video streaming industry in the nation collaboratively.”
“We look forward to further increasing the selection of entertainment even more with additional channel partners getting on board in the upcoming months.”
The Amazon Prime Video service will be home to more than 10k titles with these eight new partners on board, stated head of Prime Video Channels, Amazon Prime Video, Chaitanya Divan (2).
Notably, six of the eight Indian OTT platforms joined Amazon has come on board for multi-territory deals. They will also be available on other markers as a part of Prime Video channels. According to Divan, the aim is to deliver high selection and convenience to Prime Video users. Divan further explained that customers often have to jump from one platform to another only to watch specific titles.
It is no secret that managing multiple accounts on different OTT platforms leads to several issues like re-entering account details, forgetting their passwords, the app not working on second devices, etc.
With Prime Video Channels, users will manage all their premium content subscriptions within a single destination. It means people will no longer have to juggle between multiple passwords, accounts, and billing dates. In addition, it would also save data and customers’ time spent on deciding what to watch.
Further, the platforms are available for special introductory offers, ranging between 25 to 50% offs.
In short, Amazon is aiming at Amazon Prime Video to be a preferred entertainment destination for customers in India with the launch of the Prime Video Channel (3).
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Amazon’s Aim to Be a Super OTT App
No doubt India is an important market for Prime Video. According to a report by RBSA Advisors, an independent transaction advisory firm, the Indian OTT video market is valued at 1.5 billion USD at present. It made a forecast that it would touch 12.5 billion USD by 2030 (4).
As of June 2021, as per MPA, Media Partners Asia, research, advisory, and consulting services independent provider, Amazon Prime Video has about 18 million subscribers in India. There are expectations that it will increase by 21.8 million users by the end of the year (5).
So far in India, OTT aggregators range from those offered by telecom operators like Airtel; Airtel XStream, Reliance Jio; Jio TV Plus and JioFiber, and other DTH platforms like Tata Sky Binge.
Another relatively new streaming aggregator, ScreenHits TV (6), is also looking at the Indian market and has already collaborated with Vial Content Tech, a company incepted by Kunal Dasgupta, a former Sony TV India chief executive (7) and Vivek Gupta (8).
Notably, India is home to more than 60 OTT platforms. According to the FICCI-EY media and entertainment report 2021 (9), video subscription revenue increased by 50% last year as premium content, sports, and originals went behind paywalls during the coronavirus pandemic.
“There is a long tail of OTT platforms in the country that may not yet possess the marketing muscle. Big players with scale can hence become gatekeepers for these platforms, allowing them to get new subscribers for a commission. It allows video aggregators to improve yields and also retain customers in their wall garden,” stated the vice president of Media Partners Asia, Mihir Shah (10).
After Amazon launched the ad-driven miniTV earlier this year, it is another way for the US-based tech giant to broaden its monetization streams. It also helps the company cater to video consumers across different income segments, explained Shah.
With the rollout for Amazon Channels, Amazon now has a presence across all three video revenue segments, subscription video-on-demand, advertising video-on-demand, and transaction video-on-demand or pay-per-view. It is something we long hoped for Netflix to offer, but Amazon seems to be getting ahead of that race.
The aggregation, primarily carried out by telcos, is the way ahead, stated Karan Taurani, the senior vice president of Elara Capital Ltd (11). It helps the big players act as a super app and retain existing customers with value-added services; the smaller players also get recall and eyeballs.
“We aim to act as a mediator for the distribution of the partner platforms in a transparent matter,” stated Gandhi, adding that one way to allow viewers to be engaged is to keep offering them more content and also giving them control over what they select (12).
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The Changes on Prime Video Platform
With Prime Video Channels, the company will offer its subscribers the option for add-on subscriptions on the Amazon Prime Video website and app so users can access these streaming services’ content within a single platform.
With Hoichoi and Manorama Max, Amazon Prime members can stream titles in Bengali and Malayalam languages. Meanwhile, users can discover award-winning short films and documentaries via Shorts TV and Docubay. Eros Now and Lionsgate will allow you to get quality cinema and blockbuster movies. You can watch content related to adventure, wildlife, science, food, and lifestyle via Discovery+.
You can get the yearly add-on subscription for these eight OTT services for 699 INR a year for Lionsgate Play and Manorama Max (a 30% discount from its current price), 299 INR for Discovery+ (25% discount), Shorts TV (40% discount), and Eros Now (25% discount), 599 INR a year for Hoichoi (33% discount), 499 INR a year for Docubay (50% discount), and 1999 a year for MUBI.
Even if you are a Prime customer, you will have to pay individual add-on subscriptions, albeit at introductory discounts for the subscription via Amazon, to watch the content within the Amazon Prime Video platform. Notably, you can continue to watch the Prime Video content with no changes at all.
“We have launched with annual plans because we have found that annual plans have the highest value to customers. Over time we will closely track customer feed and also expand monthly plans.”
There will be no changes to Prime Video, explained Divan. “Within the platforms, subscribers will see a recommendation for partner content. Suppose you prefer English content, then you will see a recommendation from a partner. For instance, say Lionsgate Play, and you can click on its offered titles and start your subscription.”
As an Amazon Prime member, you will be able to watch the subscribed Prime Video Channels on the Prime Video app for your smartphones, smart IVs, Fire TV, Fire Tablets, Fire TV Stick, and Apple TV. In addition, you can download episodes on your tablets and smartphones and watch your favorite content anywhere offline within the Prime Video app.
According to Vishnu Mohta, the co-founder of Hoichoi TV (13), one of the apps to offer its services via Prime Video Channels, the subscription amount paid via Amazon will reach them. “It is a reseller arrangement, not a syndication or bundling collaboration. Even though consumption will happen on Prime Video Channels, we will get the subscription amount. We will only pay commission to Amazon.”
“From users’ point of view, it offers a hassle-free experience in terms of paying, subscribing, and even finding new content to watch. Worldwide, we are in this golden era of content today. However, there is an explosion of choices, and it becomes challenging for audiences to manage different accounts and apps. And more than that, it has become a challenge for content discovery,” pointed out Divan while explaining the rationale behind launching Prime Video Channels.
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The Streaming War in India is Pretty Hot Right Now
As mentioned above, Amazon Prime Video has more than 18 million subscribers in the country, expected to grow to over 21.8 million by the end of 2021. The current leader in the Indian OTT space in terms of the total number of subscribers, Disney+ Hotstar, boasts 35.1 million subscribers, and there are estimations that it would surge to 46 million users by the end of the year.
All of this indicates that the competition is pretty stiff in the Indian OTT market.
Notably, the hotly contested OTT market in India is already witnessing some consolidation. Two leading media houses, ZEEL, Zee Entertainment Enterprises Ltd., and SPNI, Sony Pictures Networks India, are also proposing a merger of their businesses, including their OTT services. If the deal goes through, it will likely build India’s (second) largest homegrown OTT player after Disney+ Hotstar to offer everything from regional programming to live sports (14).
According to available media reports, the combined entity of ZEE5 and Sony LIV will command a market share of more than 19% in the subscription video-on-demand market.
In addition, SPNI will be pouring more than 1.6 billion USD in cash into the merged company to accelerate its digital platform and invest in premium content, including sports. Notably, investments in sports will be crucial as the market leader in the space, Disney+ Hotstar, offers key cricketing properties, including the popular IPL, Indian Premier League.
“Disney+ Hotstar, which has more than 130 to 140 million monthly active users MAUs, on non-cricketing days, witness 30 to 50% surge in its MAUs when the platform streams key cricketing tournaments like IPL,” highlighted Nitin Mukhi, RBSA Advisors’ Associate Director (15).
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How the Move Will Benefit Amazon Prime Video?
According to Taurani, this is a big move for Amazon.
“If you wish to increase your customer, you will have to keep on adding value. Hence, adding fresh content and catalog content is one way to add value. I am sure it will go a big way,” stated Taurani.
Yet, the analysts don’t believe the collaborations between big players such as Sony LIV, ZEE5, or Disney+ Hotstar are happening any time soon.
“However, with smaller OTT platforms, these partnerships will emerge pretty strongly. There is also room since there are more than 60 OTT platforms. The need for super apps in the OTT market in India is strongly felt,” explained Taurani.
While super apps are much required in the Indian OTT market space, the bigger question is will this strategy benefit Amazon Prime Video? Can it end up adding more subscribers to the platform?
According to Taurani, “I don’t believe it will benefit Amazon Prime Video in terms of adding more subscribers. Instead, we can see the move as more of a value add strategy. However, there may be some minimal customer acquisitions.”
It is noteworthy that even Divan did not comment on whether Prime Video Channels can bring more subscribers to Amazon’s OTT platform.
“Prime Video Channels is an offering meant for Prime subscribers, and very large customers worldwide have witnessed the benefit of having multiple content services in a single platform and not requiring to keep track of different accounts and passwords. Hence, thanks to that convenience, we have seen growth worldwide and are looking to replicate that in India too,” explained Divan.
Nonetheless, Amazon seems pretty confident about its new strategy. It could be because of its success in the international markets despite the competition being tough.
“Prime Video Channels was first launched in the US five years ago. It has now expanded to more than 11 countries and over 350 channel partners. It is something we look to do in India too. We are looking at more channel partners in the country as well,” said Divan.
Meanwhile, Home Box Office Max, HBO Max for short, is an on-demand video streaming platform owned by WarnerMedia Studios and Networks, reportedly debuting in India very soon. HBO Max, which was first launched in the US and Latin America on May 27th, 2020, now has more than 67.5 million users as of June 30th, 2021.
Available media reports also suggest that HBO Max is likely to enter soon, and the company is testing three monthly plans. The company has engaged a market research company, Nepa, to conduct an online pre-launch survey.
The online leak unveils that HBO Max will launch three subscription plans in the country, primarily standard, mobile, and ad-supported, likely to start at 69 INR a month (16).
Even though the company has stated that India’s plans are not final, it would compete against Amazon Prime Video, Netflix, and Disney+ Hotstar.
We will have to patiently wait and see who will be the disruptor in the Indian OTT space.