India's mobile video business opportunity | Vidiator

Tae Sung Park, CEO of new media delivery specialists Vidiator? warns that despite consumers? huge appetite for mobile streaming services Indian mobile operators are being overly cautious towards this potentially lucrative opportunity?

Mobile Internet TV is one of the biggest growth areas in India. A recent survey conducted by Google in partnership with IPSOS and the MMA (Mobile Marketing Association) found that a third of Indian smartphone users watch TV on their smartphone.

TV household penetration in India has hit 65% and is as much as 88% in urban regions. This shows tremendous opportunities for live OTT and mobile Internet TV for those households that currently have no existing terrestrial infrastructure, cable or satellite services. The operators know this and realise the potential of the market, so why haven?t more of them rolled out mobile video services?

Their reluctance stems from an understandable concern about major investments into hardware and infrastructure and fears about the length of time it will take to recoup the money they think is needed to launch an OTTservice. On top of this many operators are busy rolling out 3G and LTE infrastructure and are worried about finding the resources to also deploy a video streaming service. They also question their ability to recoup the incremental costs of offering OTT at good enough quality to paid service in a pre-pay market.

However rolling out new services shouldn?t always mean spending big on new infrastructure and back office systems or gambling on securing high numbers of initial users. Solutions exist today for operators and broadcasters to leave the hosting to a third party, allowing them to offset the risk of investment and then scale the service as required. By playing it safe and overlooking the very real business case, operators potentially risk losing out on a very lucrative revenue stream ? one that other dynamic companies are now starting to benefit from.

Consumers today want ?everything, everywhere,? with content accessible on all of their devices whether that?s a laptop, tablet or smartphone, and they want access to that content wherever they happen to be. With many operators yet to offer their own solutions, companies such as NyooTV, BIGFlix and Eros Now, are seizing the opportunity and storming ahead with their paid-for streaming services. The success of these services shows that there?s a solid business opportunity there. The fact that India is one of the biggest consumers of Set-top boxes (STBs) shows that consumers are happy to put their hands in their pockets.

However operators need to stop wasting money on multi-million STB rollouts and focus on mobile apps and content. STB rollouts will only be a very expensive short-term gap fill. In the next 5-10 years set-top boxes as we know them will be gone, replaced by efficient software apps or by hardware integrated into smart TVs. Operators need to act quickly to re-think their set-top box strategies and consider new media software-based solutions that will provide a better and quicker ROI, and give consumers what they want.

Vidiator recently commissioned an independent survey of Indian consumers to find out what people want from mobile video and if they?d ever pay for it. Of those surveyed 88% said they would consider paying for mobile video now or in the future, with as many 54% saying they had already paid to access content.

This should serve as a massive wakeup call to operators struggling to monetize the large amounts of data currently overloading the networks ? people are genuinely willing to pay them for video content if the service is up to scratch.

It?s worth pointing out that these results come with one key caveat; people will only pay for video that?s good quality and that?s delivered quickly. Put simply, a lot of the content on the market today isn?t good enough or at least not for many people to pay for.

Some of the more common problems include buffering and poor quality images, however the biggest issue saw over 68% of people surveyed dissatisfied with the time it takes video to load. This isn?t an easy fix, but solutions do exist to deliver video more intelligently. Operators are naturally wary of major investments into new services, but high quality video streaming services don?t require new infrastructure and can be delivered efficiently. For example Vidiator?s scalable and bandwidth efficient technology facilitates the provision of music and video content at exceptionally high quality, at low bitrates, whilst keeping the initial investment low.

This is a ?new media revolution? that is being driven by the consumers and their changing viewing habits. By taking into account not just our survey results but these wider industry trends, it?s surely time for operators and broadcasters to stop fearing the market or doubting the potential ROI of launching their own service. There is a clear business case for mobile operators, broadcasters and content owners to tap into the growing global audience that is turning away from the traditional living room TV in favour of ?on the go? content.

Monetizing video shouldn?t be a complex issue or one that requires months of in-depth study and lengthy deployment projects. These survey results have shown what content providers need to do; deliver good quality content and do it quickly. A recent PwC study commissioned by Vidiator forecasts that by 2015 there will be 176m OTT viewers in India generating revenues of $552m USD revenue? don?t miss out on India?s big mobile video business opportunity.

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