London-based on-demand movie streaming and rental service Mubi recently launched its services in India. Like other streaming services giants such as Netflix, Amazon Prime Video, Hotstar et al, Mubi is offering services in India at a competitive rate and penetrating this market which has huge content consumption potential. According to industry estimates, content consumption on OTT platforms was at about 1,000 hours of fresh, long format content by the end of 2019. When so much content along with movies is being watched on OTT platforms, rules of the game have certainly changed. But streaming services, albeit popular, are still no match for the entire cinema-going experience. The elevated escapism of the silver screen still remains the core of the business and a captive audience and higher brand recall add up to keep advertisers coming to the platform.
According to industry reports, there has been no negative impact on footfalls whatsoever, despite launch of multiple OTT platforms over the last few years. In fact, the industry has breached new records in terms of annual movie collections. Globally too, developed nations have a larger presence in terms of OTT penetration, but there too the cinema business is not negatively impacted; in fact, as per some surveys, people who watch Digital content regularly are the ones who go to the cinemas also often.
“It’s interesting to note that over the last three years, with the advent of the OTT space, cinema advertising has only been growing fast and that too at a phenomenal CAGR of 19% next only to Digital CAGR of 32%,” says Gautam Dutta, CEO, PVR Cinemas. PVR’s Q3FY20 saw 9% growth YoY in ad revenues despite a tough ad environment.
This growth is primarily due to a low base effect as well as more multiplex screens coming in. There are almost 3,000 multiplex screens today and this is only going to increase from here on because it’s a very under-penetrated market. Also, single screens have got a new lease of life thanks to digital networks such as UFO Moviez and Qube Cinemas. UFO Moviez is perhaps the largest digital cinema distribution network and in-cinema advertising platform with 3,600+ screens across 1,200+ cities.
