By Sankalp Phartiyal and Shilpa Jamkhandikar
Advertising currently drives the bulk of Hotstar's revenue, its Chief Executive Ajit Mohan told Reuters in an interview on Thursday, but he added that while the platform is keen to boost its ad sales, it will look to gradually boost its revenue share from those willing to pay a fee for its Hotstar Premium service.
"There is no animal like Hotstar in many markets. Streaming platforms that are at scale are usually behind a paywall. We are an anomaly, where as a marketer, the fact that you can advertise against such high quality premium content is fairly unique," said Mohan.
The streaming platform, owned by Twenty-First Century Fox's
It has achieved this by offering exclusive premium content like HBO hit show "Game of Thrones" and live-streaming India's massively popular T20 cricket league and English Premier League action for an annual subscription of just 999 rupees ($14.20). The cheapest Netflix plan in India costs 6,000 rupees annually.
"We do not want to build a niche subscription product. We're not solving for just the top-end of the country," said Mohan. "We want to create a product that is valued and embraced by tens of millions of users."
For those unwilling to pay, Hotstar offers a vast library of ad-driven Hollywood and Bollywood movies, and TV shows for free.
Mohan said this has helped Hotstar draw 150 million monthly active users, but he declined to give exact subscriber numbers.
"A large number of people come on the back of the free proposition, and over time, with the stickiness to the platform, and by offering differentiated propositions, a substantial part of them will convert to paid subscriptions," says Mohan.
While its subscription model looks to target the offerings of rivals like Netflix, Mohan sees its free ad-driven offering challenging two other global giants.
"We believe that we have an opportunity to build a marketing proposition for advertisers in the digital world, that can be an alternative to the Google-Facebook duopoly," said Mohan.
Google
"There is a myth that most digital advertising money will finally get concentrated with Google and Facebook. I don't believe that," said Mohan. "With the kind of scale Hotstar has and the kind of value we can give advertisers, we're providing an alternative to the world."
(Reporting by Sankalp Phartiyal and Shilpa Jamkhandikar; Editing by Euan Rocha and Alexandra Hudson)
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