Chapter 2044： Still have to find allies

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In fact, just five years ago, India was generally regarded as a stagnant pool of global streaming video. It was still a generation away from having the infrastructure and market environment that could support a strong streaming media business. At that time, Netflix and others Streaming media services are regarded as a luxury.

But the low-cost smartphones from country Z have changed everything. Thanks to the influx of low-cost phones from country Z, the penetration rate of smartphones in India has risen sharply.

The tariff war of Indian telecom companies has accelerated the popularization of broadband.

Last year, a rich man in India invested US$22.5 billion to launch a telecommunications giant. By providing the lowest price data marketing plan, mobile broadband was popularized to the general public.

Currently, among India’s 1.3 billion people, the proportion of high-speed Internet connections via mobile phones has risen to 25%, and it is expected that this proportion will rise to 60% by 2023.

Considering the Indian audience's enthusiasm for Bollywood movies, many of these millions of newly connected consumers became online video users almost overnight.

The number of online video users in India will be close to 200 million this year. In the next five years, this number will surely double to 550 million, which is more than the total population of the United States. Such a big piece of cake, everyone is not stupid. Not?

Therefore, the Indians calling for becoming the center of the world's streaming media are not bragging.

Therefore, for Disney, Netflix and Amazon, as well as New Era Media, it is particularly important to seize the Indian market, especially when they cannot enter the only larger market, Country Z. Of course, New Era Media has already completed a beachhead in Country Z. Landing, there is no way, the advantage of skin color is not possessed by other giants, Yang Cheng is never proud of this!

However, although the Indian market looks more friendly in some respects-no license is required and content is rarely subject to regulatory interference, for the paid video giants, the competition in the Indian market has become more chaotic and fierce than it seems.

In terms of market structure, in India where the average salary is still only a few dollars, the service with the greatest influence and overall advantage is still an advertising support platform that is provided to viewers for free.

To date, YouTube is the most profitable video platform in India, accounting for about 40% of total online video revenue.

It provides a lot of profits to the tubing because it is free and can be used by new users. With the rapid expansion of India's overall economy and consumer class, advertising expenditures have risen sharply.

As the disposable income of the middle class in India grows, the consumption of fast-moving consumer goods is soaring, thereby pushing up overall advertising expenditures-which is a boon for advertising-supported video services, terrestrial TV and pay TV.

With the support of advertising, can the tubing not make money?

In terms of subscription streaming to which Netflix belongs, the progress has been slightly unsatisfactory.

In the field of subscription streaming, the real leader is Hotstar, a subsidiary of 21st Century Fox Holdings’ StarIndia. However, in the next one to two years, the surname will be changed to Disney. I heard that the negotiations there are nearing completion, and we will wait for the right time to announce Up.

At present, Hotstar has become the second largest video service in India by revenue, with a market share of 23%, second only to YouTube, but definitely surpassing Netflix and Amazon. New Times Media barely surpasses Amazon and slightly weaker than Netflix due to the advantages of the Toutiao app. The current share is 10%.

The most frequently mentioned bottleneck of Netflix’s subscription is its pricing. Hotstar’s premium service costs about US$3 per month, while Amazon Prime’s pricing is more aggressive, at US$1.90 per month, including delivery services, at US$14.50 a year. It's cheap. In contrast, the US price is $119, while Netflix's is the most expensive, with a monthly fee of $6.90.

Netflix has also thought about lowering prices and accelerating growth, but low pricing will not only reduce unit user revenue. If the subscription fee is reduced to 2-3 US dollars per month, even if it can reach 10 million users, it will bring 30% -40% user churn rate, which will have a negative impact on Netflix's stock price.

In the capital market, the rise and fall of stock prices are far more important than the outflow and inflow of millions of users.

The issue of pricing is not only about absolute prices. In terms of customer competition, the Indian market is also very different from the United States where Netflix started.

In the United States, it is generally believed that Netflix’s amazing growth has been at the expense of traditional TV, especially expensive cable pay TV and movies.

Compared with the US$100 monthly cable TV subscription fee in the US market, Netflix’s pricing as low as US$6 is extremely lethal.

In India, streaming media and traditional TV movies are not simply zero-sum games.

India’s TV household penetration rate is just over half, while APEC’s average penetration rate is 85%. India adds about 25-30 million TV viewers every year.

This means that traditional TV still occupies a vast market in India. If the Internet wants to replace all of them, it will take five years to start.

In addition, the Indian market is extremely special. There are as many as 23 common languages ​​in India, and the audience’s taste and education level vary greatly. This makes local languages ​​a key condition for the success of video providers. Take the leader Hotstar as an example. More than 60 channels in operation provide Hindi and a variety of regional language services.

And India’s enthusiasm for sports, especially cricket, is that subscription streaming media including Netflix needs to face new problems, because Netflix has repeatedly claimed that it will not enter the field of live sports.

In this regard, New Era Media has no scruples. Under Yang Cheng's layout, sports has always been an important section of New Era Media, and providing live sports is never a hassle.

As one of India's three "religions"-traditional religion, Bollywood, and cricket, the influence of cricket on ratings is decisive.

Streaming media giants have long known the influence of cricket, and Facebook tried to bid $600 million to acquire the digital broadcasting rights of the IPL (Indian Premier League) for the next five years.

But its purchase intention was frustrated The parent company StarIndia acquired IPL's broadcasting and digital TV broadcasting rights for the next 5 years for $2.6 billion.

It is said that the current record is that more than 10.3 million spectators watched the last game of IPL at the same time, which is why Hotstar dominates India.

Of course, cricket is not the only sport that can promote streaming media. Football matches also have a good influence in India. This is the advantage of the media in the new era.

In general, the current Indian streaming media market is in a state of separatism. If the new era media wants to successfully enter, it must find a local ally. It will definitely not work on its own. A good tiger can't stand a group of wolves. !

Tonight, Yang Cheng has dinner with Shah Rukh Khan, who is known as the king of Bollywood. Khan has his own production company in Bollywood and is a good partner for alliance!

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