TV cord cutting is a small and metro phenomenon: ZEE5’s Manish Kalra 

Cord cutting of linear television is a small and mostly metro phenomenon in India, despite the growth of the digital video streaming business, according to broadcaster-backed over-the-top (OTT) platform ZEE5’s Chief Business Officer Manish Kalra.   

“Internationally, people are cutting cords and moving away from traditional ways of entertainment. Indian metros are already seeing that and it will go more into tier-2 cities as well…Cord cutting is not significant in India. But there is a trend undeniably. Cord cutting is small and mostly in metros,” Kalra told Business Today recently. ZEE5 is the OTT app from the stables of broadcaster Zee Entertainment Ltd (ZEEL), giving the network a presence both in linear television as well as digital streaming. 

Television is the largest media segment in the country with a Rs 70,900-crore market as of 2022, while digital media is a Rs 57,100-crore market, according to FICCI-EY’s latest media & entertainment report. The video OTT business is estimated to be around Rs 13,000-14,000 crore.  

However, TV subscriptions fell 11 per cent, while all other subsets of media grew in 2022. Besides, the FICCI-EY report estimates digital media revenues to overtake television revenues by 2025.  

“There isn’t a big skew in favour of (AVoD or SVoD), but definitely AVoD is the way to go. At the same time, we are investing in SVoD keeping our future in mind. We are doing that because people are moving online, we are seeing scale of SVoD services have become significant internationally,” said Kalra, adding that consumers want quality of content and a few of them are willing to pay. For those that are not willing to pay, we have AVoD services and it is a healthy mix between the two, he added.  AVoD refers to advertising video on demand, while SVoD refers to subscription video on demand.

The OTT business is expected to grow from 45 million households paying for one or more SVoD services to 52 million by 2025, if current pricing is maintained. The slowdown in growth will be on account of affordability of OTT services. However, if pricing is reduced to Rs 1 per day or thereabouts for a popular streaming service or a strong bundle of popular content is created for up to Rs 1,200 per year, the reach could cross 100 million households within three years as an add-on to linear television, the FICCI-EY report said. 

Meanwhile, the linear television universe will remain comparatively stable at 166–169 million. Smart connected TVs will exceed 40 million (daily active users) by 2025, the report estimated.