Growing online video in India

by rohit on May 8, 2010

You Tube India

You Tube India : Poor cataloguing & inadequate local content

Online video will be a ‘killer app’ for the Internet (along with social media).    I said this on this blog in 2007.

Online video is certainly on the up. 45% of India’s Internet users watched online video or music in 2009, compared to only 32% in 2008. (Source : ICube 2009 , the annual report by IMRB-IAMAI on India’s Internet market).

And, says the report, this increased consumption of online video and social media spurred an overall increase in Internet usage. India’s Internet users, who all through the last decade were on the Net for an average of 5 to 10 hours per month, spent 15.7 hours online per month in 2009 (9.3 hours/month in 2008).

Increasing broadband penetration in India must be helping video consumption. Over half the Internet population is now ‘broadband’ (7.82 million subscribers out of 15.24 million subs, or 51.3% of total with > 256 kbps, as on end Dec ’09) (Source : TRAI).

In the U.S., 87% of the Internet audience watches online video. These users average half a dozen videos a day totaling a viewing time of 25 minutes. Growth in usage has been over 40% year-on-year. Even here, it’s early days.

WHY ONLINE VIDEO WILL BE BIG IN INDIA

In India, online video’s days have yet to come, we are just getting started. I believe online video in India will be big, even bigger relative to other Internet content than it is in the U.S. market. Here’s why :

Only 91 million Indians – of the billion plus who exist – claim to know English.  The majority of these are not fluent at all (by one estimate only 35 million can really use it). This means for Internet to take off in India we need local language content.

Unfortunately, Internet content in local languages such as Hindi and Tamil has not really grown. And there seems no indication that it ever will (much has been written on this elsewhere, including on this blog).

India’s Internet thus is trapped in the twilight zone of poor English comprehension and inadequate local content (text).

Yet, thanks to some upcoming initiatives, Internet access will explode in the next 2-3 years. These initiatives include rural broadband / Wimax, mass penetration of mobile phones, decreasing price of Internet access on mobile phones, etc.

It is online video that can feed the requirement of the masses for Internet content. Video doesn’t need reading skills; it will be in Hindi, Tamil, Gujarati et al. It’s for the masses: it’s an inherently lazy form of entertainment and doesn’t need cultural savvy as does ‘social networking.’

Here’ are some previous posts on local language content for the Internet :

More on the agenda to grow the Indian Internet market

An agenda to grow the Indian Internet market

WHY YOU TUBE – IN IT’S CURRENT AVATAR – CANNOT MEET THE ABOVE DEMAND

Today, online video is synonymous with You Tube. More so in India than in the U.S. As it stands, however, You Tube has some weaknesses :

(i) You Tube’s videos are not well-catalogued. One would have liked a Directory. The current ‘Browse’ section is not really a Directory, it’s not deep enough. And, I believe, ‘search’ is not good enough for a category like video, with the Indian market being as basic as it is.

(ii) Most You Tube content is amateur videos, thus not the most appealing.

(iii) Indians have not, so far, been either prolific or quality content creators on the Web. Our websites and blogs do not measure up to the standards one sees in U.S. sites.

Likewise, in the case of videos, amateur uploads are few and far between. India currently ranks at the bottom among countries in terms of video uploads, so inform my ‘sources in Google India’.

The above factors today bottleneck adoption of You Tube / online video. And by extension, hinder the growth of the Internet per se.

WHAT WILL HELP GROW ONLINE VIDEO

1. Mega-events on You Tube

Premium rather than amateur content can boost You Tube growth.

The last post was about the IPL3 cricket tournament on You Tube. This was a watershed event for You Tube, for Google in India and for the Indian Internet industry. It’s created buzz (this NY Times article is,by the way, inaccurate. Youtube.com/ipl got 50 million pageviews, not 50 million viewers).

It’s inspiring Google to think of hosting other sports events on You Tube.

This makes sense. Streaming movies online is still iffy, the movie industry – Hollywood and Bollywood – being most wary of possible piracy.  That leaves TV programs and events, notably sports events, that can go online.

2. Curated video sites

Fora TV is a site that features content from elite conferences – such as the World Economic Forum – where scientists, authors, intellectuals, captains of industry, world leaders and other such smart people gather to tell one another what they’re thinking, planning and doing.

Academic Earth is a site that aggregates video lectures of different universities.

These are video sites on compelling subjects where the content has been editorially ‘curated’. Can we have more such sites in India too ? Or is it too much to expect considering the volume and quality of professional videos  available ?

3. Sites with premium content

Hulu

Hulu : Premium content from leading TV channels & a great interface

In the U.S., sites such as Vimeo and Hulu host premium content – from studios. Hulu is a joint venture of three of the 4 biggest U.S. broadcasters viz. ABC, Fox and NBC. Then there are Netflix, Apple TV (iTunes) as well as the broadcaster’s (CBSABC et al) websites themselves. From U.K., we have iPlayer from the BBC.

These sites cannot for the most part be accessed in India (guess there’s a concern about piracy ?). We need some such sites – with local content – here in India too.

4. The Internet can be your TV

The above choices on web  are causing some to switch. 800,000 U.S. households are believed to have terminated their C & S connections and switched to web TV. This is less than 1% of the 110 million U.S. households having Cable or Satellite.

However, many more households are now dual users of C & S and online TV.

Unlike a TV set which is usually tethered to a fixed location, one can watch TV in the kitchen off a laptop. Laptops, PCs and now the iPad make it convenient to view TV in multiple locations within a home. This is a niche market that online TV serves well.

Then there are online TV aggregator sites showing TV programs, taking on C & S. These appear to be of moderate quality but have several attractive claims. With a $45 one time payment you can watch 2100 channels for ever, they say, why pay more for the cable or satellite options. Here is another one.

Online video can complement TV in other ways. TV has been around for over 50 years, but thus far it was not possible to watch old programs. These old programs can get an extended lease of life, and online communities can form around them. Here is one.

One can also download these shows for later viewing and avail of other interactive value-adds.

5. Online video is coming to the mobile Internet too

IPL3 matches were streamed over mobile phones too. About 3.7 million video views equalling 15,000 video hours were streamed over the mobile by couple of companies. The technology was developed to enable the matches to be seen over GPRS. (Didn’t get a chance to test this myself, though).

Mobile video has been big in markets like Japan and South Korea; here too things should look up now that 3G is on the anvil.

ON THE FUTURE OF ONLINE VIDEO

The industry has slowly but surely learnt to overcome the engineering challenges of  ‘simulcasting’ over the Web. For example, Akamai says it handled U.S. college basketball playoffs on the web last year with hundreds of thousands of live simultaneous viewers. While they have done such events for several years now, this was the first time that the majority of the users were on a 1 Mbps+ connection. The quality, while not excellent, was watchable.

One may presume that one day there will be a ‘celestial jukebox’, where video, TV and music will all be in the ‘cloud’. We will be able to access this content over any device, be it PC, netbook, iPad, TV or cellphone. Companies like Apple and Disney are working towards it.

Online video may one day be ubiquitous and effective. These are early days. And, as I said above, for Internet in India to grow, content in the form of online video is key.

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The IPL cricket tournament is currently so much in our face, that I cannot but write this piece about it and – my favourite topic – the Internet.

This post has an ambitious agenda !

A. It informs us about the recent growth of You Tube
B. Suggests why online video / You Tube is important for India’s Internet and for Google
C. Suggests why Google chose the IPL event to push You Tube (as You Tube IPL channel)
D. Hypothesizes on what business objectives Google probably has (for You Tube IPL channel)
E. Identifies the audience segments who will watch it (You Tube IPL)
F. Reports on the viewership achieved in the tournament’s first week (by You Tube IPL)
G. Informs what value-adds are available on the channel per se

A. Google & Yahoo are no longer the only big properties on the Internet

What we do on the Internet changes with time. From online directories, email, chat and news – in the early days – we moved on to search, instant messengers, blogs and jobs.

Social networking and online video will be the BIG Internet applications of the future. I said this two years ago – in a previous post on this blog.

Indeed, usage is growing fast – for both Facebook and YouTube. This could be happening at the expense of the traditional portals (Yahoo, MSN). Facebook is now the number 1 site in terms of global minutes of use. And You Tube is number 2. Take a look :

Facebook + YouTube usage (in global minutes, Oct 2009)

Facebook + YouTube usage ( in global minutes, 06/06 - 09/09 ) ( Deep blue = Facebook, Red = You Tube, Green = Google, Yellow = MSN, Light blue = Yahoo )


Social networking is much talked about e.g. you read of Facebook everyday.

What of video?

Not as much is heard of online video here in India. The world’s 4th largest Internet market (60 million users) has been traditionally considered bandwidth-starved and is ‘not known as an online video market’. Even though, 19 million of these users are on You Tube (Source : Google India). Perhaps, the usage of video is low.

(By the way, in this discussion, we are going to take You Tube as a proxy for online video. There are many other sites that stream video but You Tube is way ahead. Comscore reported that in the U.S., You Tube had a 39.5% share of the videos watched in Jan 2010 and the next nearest competitor Hulu had a 2.8% share. One suspects that in a less evolved video market such as India, You Tube’s share of videos watched is still higher).

Now, in terms of unique visitors, You Tube probably has a half billion unique visitors globally (It had 466 million of 1100 global Internet users in Oct ’09 – and grew 21 million users in two months: Comscore).

B. Why is online video important for Internet in India ?

Now, I would argue that online video / You Tube is more important to India than it is to the world. Here’s why.

In previous posts on this blog, we saw how the Indian Internet market suffers from the lack of development of local languages. Internet content is overwhelmingly in English, and the keyboard-OS ecosystem hasn’t evolved either. My experience at Rediff.com, where I interacted with Internet users all over, showed me that many Indians who claim to know English, actually have a poor command over the language, and lack grammatical and comprehension skills.

In other words, video could be a killer app for the Indian Internet market.

Separately, there is optimism ( ‘The Mobile Internet Report, 2009‘ by Mary Meeker of Morgan Stanley) that video will grow fast on the mobile as well.

C. Why did Google choose IPL to push You Tube (youtube.com/ipl) ?

The challenge in promoting You Tube, of course, is that we get enough of video already: television is booming in India, with hundreds of channels.

So if video is going to be the next killer app on the Internet, it better have a great launch pad.

And what better than a cricket tournament? A tournament that lasts 60 days, over 43 matches and is, to boot, an annual event ?

The latest TAM (Television Audience Monitor, the guys who track the TV audience) readings, which were out yesterday, show that during the first three matches of IPL3 (on March 12th / 13th) an average of 37.1 million people watched on television. This was up from last season’s (IPL2) 29.4 million. Projected over the entire tournament, this translates to about an audience of 2 billion (=37 x 60).

Now, let’s say that no sports or entertainment event in India can provide as high a viewership (audience in millions) as the IPL tournament.

So, if Google (the company which runs You Tube) wants to grow the online video market in India, it had better try grab a share of the above TV eyeballs.

Cricket matches have been streamed online before, for several years now. We have had CricInfo and WillowTV, among others. Here the model all along was to charge subscription fees.

What’s also different about You Tube / Google is that this videocasting is free. And, therefore, ad-supported.

Now, no one will argue that Google alone can execute this. The technical challenges of streaming to large numbers of concurrent users are not easy to meet.

D. What are Google’s possible business objectives in streaming  IPL on You Tube?

Google India’s possible objectives are three or four :

1. Build higher saliency for You Tube as a brand in India

This IPL season is being well marketed. It’s also the most authentic multiple-platform, live event one has yet seen in India: there’s live coverage on TV, Internet, theatres (673 numbers) and the mobile (m.iplt20.com). Internet (You Tube) is accordingly getting it’s due share of publicity / coverage.

2. Test / learn the technical ability to stream such a large event.

As per the company, this is the largest ever live streaming event worldwide on YouTube.

I mean, if they get it right, who knows, it could next be the London Olympics on You Tube.

3. Develop a new advertising market.

Google’s running a one-legged revenue race (search) right now. And You Tube is known to be a big financial drain for the company. With an estimated 500 million unique visitors and growth rates in minutes of 70% Y/Y (Comscore data), this burden can only increase.

It’s thus time to make a big push for big-ticket advertisers – in India and elsewhere.

Earlier press reports talked of You Tube gunning for 10 sponsors for this channel. Rs. 40 million was the price for the presenting sponsor and Rs. 15 million for associate sponsors, and a revenue of Rs. 200 million was anticipated. It’s structured as a revenue share between IPL and Google.

4. Gather data/analytics on user behavior for possible later use.

An interesting dynamic : viewing time. Currently, an individual You Tube video is, on an average, just under 3 minutes (Comscore data). Will people sit in front of a PC and watch a three hour match? How many breaks will they take, etc.?

E. Reality check: Is anyone at all going to watch IPL on You Tube!

When it comes to cricket, there are a few niches that online video can better serve than TV.

1. People at work, in offices, possibly working the second shift, say in call centres.

2. Indians living overseas.

In the U.S., home to about 2 million Indians, for example, the IPL is being telecast by satellite TV company DirecTV. It’s charging $99 to watch the tournament (+ one needs to buy the DirecTV receiver, typically $200+).

Now, IPL coverage on You Tube is available in the U.S. as a delayed feed, that starts 15 minutes after the game is over. This delay is presumably not to conflict with the paid DirecTV. Since the matches are being played at a time when it’s working hours in the U.S., however, many youngsters won’t watch TV; the delayed IPL videocast should do fine.
3. Cricket lovers from other countries such as Bangladesh or a West Indies. Not all countries have live telecast (see this list on Wikipedia).

4. A handful of cricket lovers who want to avail of the value-adds features available on YouTube.

In other words, this IPL project is a big pilot for You Tube.

F. How’s the viewership trend for youtube.com/ipl for the first week?

The IPL channel on You Tube was already, within two days (March 14th) of the start of the tournament (March 12th), the most subscribed channel of You Tube India. It overtook the NPTELHRD channel, that carries videos of lectures by IIT Professors.

IPL is the #1 channel on YouTube India

Within 2 days of the start of the tournament, IPL has become the #1 channel on You Tube India

Channels are branded (sponsored) properties on You Tube. You Tube India has just 100 of them. As you can see, cricket / IPL viewership is ahead of entertainment (Rajshri, Eros, Zoom, Yash Raj Films, Zee and NDTV), religion (Rajshri, Swami Nityananda’s Life Bliss) and education (NPTELHRD, glad2teach).

And in terms of channel views, youtube.com/ipl is averaging 1-2 million channel views daily. Maybe we’ll get 60 million views for the tournament total. My own guess is they have a maximum of some 300,000-400,000 users (assuming 4 channel views per user per day) . Or, less than 1% of the TV audience that is being got. Truly a niche audience.

Likewise, the IPL Fan Page on Facebook is rocking; it has 275,000 odd fans as of now. To put this in perspective, let’s remember that Zoozoos is probably India’s largest Facebook Fan Page with 400,000 odd fans. This puts the IPL Facebook  page in the top league.

G. I watch IPL on TV. What value-adds can I get from the You Tube coverage?

The IPL 3 matches are being streamed with a 5 minute delay. In addition, there are many extras: ‘official’ videos of match highlights, presentation ceremony and ‘great shots’; a photo gallery and two alternate camera feeds to choose from. There is also a smart integration with Twitter and  Orkut.

Then there is the IPL website itself which has extras like ‘Hawk eye’, Pulse, Predictor, a live scorecard and merchandise available for sale online. Then there is, supposedly, mobile video also at m.iplt20.com.One can also buy tickets online to the live matches.

And, oh yes, there have been ‘technical difficulties’ galore, many viewers of youtube.com/ipl have failed many a time to get a good coverage of the match.

This project is best seen as a You Tube strategy that Google will want to get right over time. Let’s see how things pans out.

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