Net traffic surges during coronavirus lockdown, but video streaming cos may need new content to gain users

According to a research note by Bank of America (BofA) Securities, app downloads of Zee5, Amazon Prime and Netflix showed a strong spike in March “as consumers look to watch content when being locked at home”.

However, similar traction was not witnessed by Hotstar, which is the mainstay for online viewing of sports events — most of which have been suspended across the globe because of COVID-19 outbreak. Hotstar also recently deferred the launch of Disney’s premium portfolio under the Disney+ brand, which would have added hours of new streamable content to Hotstar’s current library. “While Disney+ launch (expected to on 29th Mar with start of IPL) has been pushed back, we see competition picking up with the app launch given its appealing family content. Ideally, a lockdown like this could be good time to launch Disney+ as it would gain instant traction,” BofA Securities noted.

“A potential cancellation of IPL creates a huge opportunity loss for Hotstar which brings huge traction on the platform every year — some of which should be overcome on back of increased viewership due to more people watching content as they stay at home. Last year, Hotstar saw 20 million+ viewers on its platform in a single day on the day of IPL final and 300 million viewers during the season,” the research report added.

Even before the 21-day lockdown was announced by Prime Minister Narendra Modi, a number of film production houses suspended their activities as state governments were clamping down on multiplexes and movie theatres across the country.

The FICCI-EY report said that Netflix is expected to invest Rs 3,000 crore in 2019 and 2020 towards content in India “to license and create over 50 originals and shoot across more than 20 cities”. It also noted that in 2019, over 1,600 hours of original content were created for OTT platforms , which led to increased demand.

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