India's OTT Market to Double by 2028, Expected to Reach Rs 35,100 Crore

The post-pandemic shift towards over-the-top (OTT) platforms in India has revolutionised the video market, reshaping how audiences consume content. OTT platforms are not only a destination for exclusive content but have also become the go-to destination for blockbuster movies shortly after their theatrical release. With reputed award ceremonies and festivals, including Filmfare, acknowledging the OTT content now further their stature in the entertainment industry.

World's fastest-growing OTT market India has witnessed a 20.9 per cent rise in 2023, according to the latest report by PwC India. The report said that the market has reached Rs 17,496 crore ($2.1 Bn) during the period project and is estimated to double by 2028 at a compound annual growth rate (CAGR) of 14.9 per cent. This is the highest among the top 15 countries.

The report "Global Entertainment & Media Outlook 2024–28: India perspective” also highlighted that as per the 2024 outlook, the country's cinema market continues to expand and grow at a 14.1 per cent CAGR.

Overall Growth of E&M

Overall, the Indian entertainment and media (E&M) industry is projected to grow at CAGR of 8.3 per cent to reach Rs 3,65,000 Crore, outpacing the global rate of 4.6 per cent.

"Despite economic challenges and geopolitical tensions, global E&M revenues grew 5.5 per cent year-on-year, from Rs 13,891,000 crore in 2022 to Rs 17,359,000 crore in 2023," the report noted.

Currently, the US leads the global E&M market by revenue, with China in the 2nd place and India at the 9th.

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“India’s Entertainment & Media sector is on the cusp of a major transformation," said Manpreet Singh Ahuja, Chief Digital Officer and TMT Leader at PwC India.

"Key growth drivers such as digital advertising, OTT platforms, online gaming, and Generative AI are shaping the future of the industry. These rapidly expanding segments are positioning India as a global leader in innovation and growth," Ahuja added.

He also highlighted that businesses that adapt and innovate in these areas are poised to seize unparalleled opportunities in this dynamic landscape.

With growing consumption and gross domestic product (GDP) growth in India, country's advertising market will also witness growth 1.4 times above global average. It is projected to grow at a 9.4 per cent CAGR from Rs 1,01,000 crore in 2023 to Rs 1,58,000 crore in 2028.

India is poised to become the fourth-largest TV advertising market by 2026. It further noted that the shift towards cord-cutting is expected to accelerate. Traditional TV advertising will grow at a 4.2 per cent CAGR between 2023 to 2028, while global revenues are set to drop by -1.6 per cent.

Online gaming and esports are projected to represent 9 per cent of the E&M sector by 2028. It said that generative AI (GenAI) is set to transform content creation, personalisation and monetisation, with over 70 per cent of global companies expected to adopt it by 2025.

"Early adoption of GenAI in India can drive hyper-personalised content and dynamic advertising campaigns," the report highlighted.

The total music including live, recorded and digital, revenue grew from Rs 2,416 crore in 2019 to Rs 6,686 crore in 2023. It is expected to cross INR 10,899 crore by 2028, growing at a CAGR of 10.3 per cent.

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Reason For Growth

The report has attributed this growth drive to India’s improved connectivity, rising advertising revenues and favourable Government policies around foreign direct investment (FDI). With its 91 crore millennials and Gen Zs, 78 crore internet users, and 80 crore broadband subscriptions, the country is predicted to see one of the highest growth rates in the next five years.

Indians are spending 78% of their time on mobile phone apps related to E&M.

Scope of Enhancement

The report recommended consolidation among regional or niche players through mergers and acquisitions to increase size and scale. It has also advised investment in cost optimisation through analytics, audits, and automation to lower operational and production costs. The report suggested for innovation in content strategy, including esports, online gaming, and indigenous sports to meet changing consumer behaviours.