After Reliance-Warner deal, JioCinema pricing, local content in focus

Bodhi Tree Multimedia

28/04/2023 12:25

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      Reliance's JioCinema to lock horns with Netflix, Disney
    

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      Warner deal to boost English content, local content in
focus too
    

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      Executives say Warner deal will boost Reliance streaming
plans
    

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      JioCinema content quality key to beat rivals, analyst says
    

  
    By Shilpa Jamkhandikar, Aditya Kalra and Munsif Vengattil
       MUMBAI, April 28 (Reuters) - The video streaming
business of Mukesh Ambani, Asia's richest person, is likely to
focus on pricing and local content following a deal with Warner
Bros as it seeks to challenge the likes of Disney and Netflix,
industry sources said.
    Under the content deal announced on Thursday, popular series
from HBO and Warner Bros  WBD.O , such as Harry Potter and
Succession, will be available from next month on the JioCinema
platform, which Ambani's Viacom18 has promoted for weeks by
offering popular IPL cricket matches for free.
    A pricing strategy for JioCinema is still under discussion
internally, an industry source said, but Ambani has a reputation
of disrupting rivals in the price-sensitive Indian market with
cheap offers. In 2016, he offered mobile data for free, making
his Jio telecom service India's top player. He is adopting a
similar strategy to promote his consumer goods to rival
Coca-Cola  KO.N  and Nestle.
    Viacom18, the broadcast division of Ambani's Reliance
Industries  RELI.NS , didn't immediately respond to a request
for comment. Its shareholders also include Paramount Global
 PARA.O  as well as Bodhi Tree, a joint venture between James
Murdoch and former top Disney executive, Uday Shankar.
    The Warner deal, industry executives and media analysts
said, will boost Viacom18's already announced plans to "innovate
and disrupt" the sector, and help to attract the premium English
speaking audience in India.    
     At stake is a slice of a video streaming market that is
expected to grow annually by 22%-25% to reach $13-$15 billion by
2030, according to a 2021 report by Indian lobby group CII and
the Boston Consulting Group. 
    That compares with projected annual growth of 8.63% in the
U.S. market, which is expected to hit $54.66 billion by 2027,
according to Statista.
    While Netflix and other rivals boast of content specially
created for the India audience, JioCinema's current free
offerings largely include old Hindi and local language movies.
In sports, it has IPL cricket streaming rights until 2027 and in
March bagged exclusive rights for MotoGP in India.
    The big challenge is lack of fresh local and global content
on JioCinema, something that will be become even more critical
as the IPL season ends next month.
    JioCinema is in talks with various production studios and
has plans to introduce dozens of TV shows and movies on the
platform in the coming months, in Hindi and other languages, a
second industry source told Reuters on Friday.
    "There are many Indias within India. While IPL is for the
masses, partnership with Warner is a precursor to JioCinema's
entry into the premium subscription segment," said Mihir Shah,
vice president at Media Partners Asia. 
    Nitesh Kripalani, former country head of Amazon's Prime
Video in India, said he expects Reliance's venture to do more
such deals, but pricing remains key.
    "India is a value conscious market. For any media business,
anywhere in the world - you need to get consumers to pay.
Advertising can only pay so much," he said.
    Netflix  NFLX.O , Amazon  AMZN.O  and Disney  DIS.N  Hotstar
have become popular in India by launching exclusive movies and
web series starring Bollywood actors. They have also diversified
into regional local language content.
    At present Netflix - which has most the expensive
subscription plans - has just 8 million subscribers, Amazon has
17 million, while Disney, which earlier had the digital rights
for IPL, leads with 49 million, according to Media Partners,
which doesn't have data for JioCinema's free service. 
    Karan Taurani, a vice president of India's Elara Capital,
sad JioCinema's success will hinge on quality of its content.
    "They may make so many films and series but (what if) more
than 70-80% of them bomb? The only way to scale up is to really
differentiate your content and make sure execution is right," he
said.

 (Editing by Sharon Singleton)
 ((aditya.kalra@thomsonreuters.com; +91-11-49548021;))