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Volume 10, Issue 1, January-February 2019, pp. 61-71, Article ID: IJCET_10_01_008
Available online at
http://www.iaeme.com/ijcet/issues.asp?JType=IJCET&VType=10&IType=1
Journal Impact Factor (2016): 9.3590(Calculated by GISI) www.jifactor.com
ISSN Print: 0976-6367 and ISSN Online: 0976–6375
© IAEME Publication
ABSTRACT
With growing digitization, the challenge for marketers is to understand how
consumers consuming Over-The –Top (OTT) content adopt and consume messages in
this format effectively. Superimposing the theoretical framework of Uses and
Gratification meant for television to internet platform, this paper in a novel approach
tries to understand the consumption patterns and adoptability factors of OTT among
consumers. The qualitative methodology adopted for this research, brought out four
themes enabling the success of this platform: Convenience, mobility, content and
subscription strategies. These strategic parameters will ensure higher engagement
levels of the consumers for the OTT content.
Key words: Content, Consumer, Subscription, Mobility, Convenience, Digital, Over-
The-Top, Adoption, Video, Internet, Millennial, Engagement, Multi-Media,
Innovation.
Cite this Article: Dr. Sabyasachi Dasgupta and Dr. Priya Grover, Understanding
Adoption Factors of Over-the-Top Video Services among Millennial Consumers,
International Journal of Computer Engineering and Technology, 10(1), 2019, pp. 61-
71.
http://www.iaeme.com/IJCET/issues.asp?JType=IJCET&VType=10&IType=1
1. INTRODUCTION
Over-The-Top (OTT) content is becoming a big buzzword in today’s technology and systems
enabled environment. Being one of the largest economies in the world, Indian television
industry is going to garner revenues of more than Rs. 975 Billion by 2019. (KPMG-FICCI,
2015). With the full force attempts to increase the nationwide internet (1) penetration, India is
likely to witness more than 500 million Internet users by June 2018. (IAMAI, 2017). In this
digital era, Over The Top (OTT) content has emerged among millennial as the new standalone
digital multi-media platform where multi-cable or direct broadcast satellite television do not
distribute or control content, leading to media and consumer autonomy of consumption.
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Viewers will now have complete autonomy in terms of choosing their own content and
pricing, keeping in mind the exact type and amount of content they want to view. Another
major trend emerging in television content viewing is the emergence of OTT platforms by
individual media houses. This trend is primarily fuelled by increase in the number of devices
that support these platforms along with tremendous rise in the number of internet and mobile
data subscribers. The rise of OTT platforms has also seen growth with the steady but positive
increase in the number of people who are wanting and demanding both ‘Produced-for-TV’ as
well as exclusive freshly brewed content on demand anytime of the day, thus making it one of
the biggest opportunities in the video and content sector in the entertainment industry.
Currently, India has more than 11 OTT platforms with the major one’s being HotStar by Star
Network, VooT by Viacom18, Sony Liv by Sony, Spuul, Netflix, Eros Now, and Hooq. There
are other multiple independent content creators like TVF who are now coming up with their
individual OTT platforms like TVF Play in order to compete directly with the mainline
platforms by providing freshly brewed content over the others. Thus it is becoming evident
that OTT contents and the platforms associated with it are becoming major sources of
communication and revenue streams for corporate organizations.
With large OTT services going extremely heavy on marketing for acquiring and grabbing
customer’s eyeballs, the Video-On-Demand (VOD) market is on the brink of a massive
takeoff. Factors like digitization, reduced mobile data costs, high speed internet, and multi-
screen penetration across geographies and classes and fixed line broadband growth, forecast
huge potential in the sector of OTT services in India, which is likely to grow manifold in the
coming years. A trend of people viewing multiple content channels at the same time, along
with demand for newer and more exclusive content has led to many media houses and
partners to start their own OTT platforms. Although the revenue and business model of the
platform remains the same as a traditional TV channels, that is paid advertising, the feasibility
of the same has been questioned in multiple forums. Many platforms have however claimed
that the traction that is generated by the free content usually helps garner higher paying
subscription base. Thus a research in this field would open up multiple opportunities for
varied platforms and enable marketers to understand and better their strategy regarding the
same.
The aim of this research is to understand and analyze the type of content viewed, expected
and demanded by the intended audience, thereby inferring the ways in which consumers take
decisions regarding contents in OTT platforms. The objective of this research is to understand
gratification factors associated with the adoption and consumption of OTT content.
2. LITERATURE REVIEW
There has been a tremendous rise in media consumption in digital formats across the world.
The consumers today have the liberty to access the media content of his choice anytime
anywhere. This has been possible due to increase in the number of devices supporting digital
media and enhanced internet speed. The rise of Netflix, Hulu, Amazon, Apple TV etc. have
started challenging the supremacy of the traditional television. (Deloitte, 2017).The
Smartphone mobile traffic in 2014 was 1.73 EB and is projected to grow at a compound rate
of 60% from 2014 to 2019. (Deloitte, 2017). The digital media worldwide is projected to
increase to $118bn by 2021 with a compound annual growth rate of 11% between 2016 and
2021. (Lacy, 2017).Keeping in line with the global trends, India has also shown an increase in
the consumption of all types of content ranging from text, audio or video on different digital
platforms. India has become the second largest online market after china with over 460
million internet users. By 2021, it will jump to 635.8 million users. (Statista) A lot of
favorable factors like improved networks, better access to internet, multimedia service-
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various gaming devices like Xbox One, PlayStation, smart set-top boxes like Apple TV,
tablets and smart phones like iPhones and Android phones. OTT platforms have thus
challenged the traditional content and service providers.
Various factors are driving paid subscriptions like need for high quality videos, better
viewing experience, ease of access and wider content choice. Though the internet speed in
India is one third of the global average, but the optimal data speed along with friendlier data
costs would contribute to a rapid growth in OTT in India.
With 75% of Indian internet users in the age group of less than 35 years and more than
50% of smartphone app users aged between 18 to 24 years, OTT platforms are targeting a
younger demographic. (Accenture, 2015)
With 70 million video viewers in India and about 1.3 million OTT paid-video subscribers,
the number of Indian consumers inclining towards OTT platforms is increasing rapidly. But,
the numbers fluctuate every month. Hotstar claims to have 5 million viewers on a regular
basis which could rise up to 100 million during IPL season. (Accenture, 2015).OTT services
in India uses top-down approach in India but to be successful in the long term, a bottom-up
approach to reach at every segment of internet savvy population.
3. KNOWLEDGE GAP
One of the primary things that the literature has pointed out to is the consistent lack of
concrete evidences to understand and assimilate the consumption patterns of millennial in
India. Although it has shown multiple factors that are leading to the rise of OTT platforms in
India, there are hardly any research papers from the consumption viewpoint suggesting which
specific content is consumed by which specific target group and the reason for the same. It
has also shed light on the factors that have affected the content viewing on OTT platforms,
but questions still rise on whether those remain the only factors that affect the same. There is
yet a need of a detailed study which describes in detail the kind of preferences that millennial
have in terms of the video content and whether or not it will ever lead to the popularity of
OTT platforms in India. Thus, the knowledge gap prevalent in the review is the dearth of
research to understand reasons for consumer preferences of content on OTT platforms. A lot
of research has been done to study the factors contributing to the success of OTT in India but
not much has been researched on the factors contributing to millennial consumer adoption of
OTT services in India. This research paper tries to understand the factors leading to adoption
of OTT services by millennial consumers on a long term. This will help companies offering
OTT services an insight into the reasons for consumer preference for this service and ways to
induce repeated purchase and final adoption of OTT platforms in India.
4. CONCEPTUAL FRAMEWORK
In terms of the conceptual framework, there are some concepts which require special attention
in reference to the meaning that they carry with respect to this research paper.
Innovation: Any good, service or idea that is perceived by someone as new. (Keller, 2017)
Adoption: An individual’s decision to become a regular user of a product. (Keller, 2017)
Innovation-Diffusion process: The spread of a new idea from its source of invention to
its ultimate users or adopters. (Keller, 2017)
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5. THEORETICAL FRAMEWORK
5.1. Innovation Adoption Model (AIETA Model)
This model developed by Rogers focuses on the mental processes through which a customer
passes through from the point he hears about an innovation till he finally adopts it. (Keller,
2017).
Awareness: The consumer comes to know about the innovation but lacks information
about it.
Interest: The consumer is motivated to seek information about the innovation.
Evaluation: The consumer considers whether to try the innovation.
Trial” The consumers tries the innovation for the first time.
Adoption: The consumer becomes a regular user of the product.
6. RESEARCH QUESTIONS
The research questions in this case are the following:
1. What triggers millennial to prefer OTT platforms over traditional video viewing
platforms like TV?
2. How often is it observed that millennial prefer OTT platforms over TV?
3. What are the typical behavioral, personality traits of the consumers who consume
content on OTT platforms?
4. What are the content types that are preferred for these consumers?
7. RESEARCH DESIGN
7.1. Methodology
The methodology adopted in this research was qualitative in nature. This methodology was
chosen as not much literature was available for this research as well as the research required
an in-depth understanding of gratification factors by delving deeper into the consumer mind
for gathering insights. Interpretative paradigm was taken into consideration. The research
adapted an in-depth interview method since the requirements of the research was to use
laddering technique and understand the root-cause analysis of consuming content in OTT
platform. This method is usually helpful in obtaining reasons and causes through an in-depth
conversation on current video viewing patterns, behaviors, beliefs, norms, attitudes, and
practices that might have influence on their OTT content usage. The tool of qualitative
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research was a carefully prepared discussion guide consisting of ice breaking, generic and
specific questions. The points in the discussion guide helped the interviewer to converge the
research to a certain direction. Hence, the researcher undertook a convergent strategy to arrive
at the themes of gratification. Thematic content analysis was done based on the transcripts of
the interview. From the findings of the themes, inferences were drawn as to the popularity,
sustenance and marketable quotient of the medium. The findings and analysis justified the
research questions and the objectives of this research.
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7.4.1. Convenience
“It is so useful that I can easily navigate through it” says Rajesh Sharma, while talking about
an app related to banking. Another respondent, Ritu Jha commented, “I can chat with friends
anytime I want through WhatsApp. It is suitable to the format of conversing and exchanging
information”. Similarly, many respondents in this study claimed that the kind of ease with
which they are able to use and adapt to these platforms are much higher as compared to the
amount of clutter they end up dealing with on the loads of channels on television. They
suggested that in a fast moving consumer world, where time is a scarcity, if apps and different
OTT platforms provide convenience in terms of banking, shopping, making travel plans,
organizing events etc. then it will be a much sought after platform. However, some of the
respondents were also of the opinion that navigation through these platforms need to be made
easy and less time consuming. This facility will gratify consumers with the objective of
solving more work in less time. Hence, it can be inferred that one of the major reasons of
adoption of a certain OTT platform is based on the convenience that the platform provides.
The marketers or the app developers need to take into consideration who is app is being made
for and for what purpose. These two questions need to be kept in mind as different target
groups have different perceptions about convenience. So, if the target group and the purpose
of the target group in using in app is clearly understood by the brand, the OTT platform brand
should work to enable these facilities and communicate it to the target group.
7.4.2. Mobility
Another major reason for adoption of OTT platform is the freedom of movement that these
platforms provide. “I wanted to watch a cricket match while travelling. Thank God, I had
Hotstar installed” says Rakshit Menon, an entrepreneur who loves cricket but at the same time
has to travel a lot. Mobility is thus an important adoption factor for the OTT brands. With so
much of corporate tours that employees need to do, it becomes difficult to watch television or
any static medium. The requirement of the hour is something “on-the-go”. OTT platforms
gives flexibility to the viewer to watch any programme wherever he/ she goes. So the content
can be watched anytime at any place. The consumer is ready to pay additional cost provided
the consumer gets freedom and flexibility to watch anything anywhere. According to Mohan
Nath, a budding journalist, “I need to be aware of the news every time I travel. OTT platforms
give me that liberty to be constantly updated with the latest happenings.” Hence the second
factor that the communicators of OTT needs to keep in mind is to express the benefits of OTT
platform and content in terms of the freedom and mobility it provides to watch anything at
any time without missing even if it has already been telecasted. Hence delayed telecast is
gaining a lot of popularity as it is not only convenient to watch, but also through OTT
platforms, it is more mobile in nature. For enticing customers to avail the OTT brand, the
marketing should be done in such a way that the benefit fits into the enhanced mobility need
of the customer.
7.4.3. Content
Among the four parameters of adoption strategy, content occupies the central position in
terms of interest generation among the audience. “If the content is not good, no matter how
the convenience of a platform is, I will not be interested to visit again”, says Ranjit Gupta, a
student of a reputed college. Almost all respondents were of the opinion that all other factors
aside, it was the kind of content that attracted them to use these platforms in the first place
after being introduced to it. Hence, it is very important to put in the appropriate interesting
content in these platforms. The content, according to respondents, need to be contemporary,
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interactive and fun to engage with. There could be graphic interfaces and innovative visual
effects need to be incorporated so that it entices the millennial consumers to be engaged,
involved and interact with the content. In this way, there will be enhanced gratification of the
platform. So, it can be inferred that there if the content is not engaging, other marketing
elements will not be able to popularize the platform, given the fact that there is intense
competition between these platforms. The brand needs to cater to attractive content and genre
to connect to the audience. The millennial audience is extremely choosy and flirtatious with
different platforms. The contemporariness of the content is something that brand managers
and platform developers need to concentrate on so that there are repeat viewing of the
platform. This is possible when the theme of the OTT platform, the audience and the content
is in sync with each other and creates an effective connect among themselves. This process
will ensure that consumer connect is optimum in these platforms in the cluttered OTT
platform industry.
7.4.4. Cost
OTT video platforms have a peculiar problem especially in a market like India. The concept
of a paid subscription is still quite nascent in the market and thus most people are still
restricting themselves to either free content or limited free period that the brand/platform
offers. Out of the 35 respondents only 10 respondents were subscribed to or have ever paid for
a premium subscription on an OTT platform from the time they started using them. Most
respondents were of the opinion that they would rather enjoy themselves in these platforms
free of cost. However, when money is involved to access these platforms, respondents were
slightly hesitant to pay for such platforms. Only 12 out of 35 respondents showed any
willingness to pay for the subscription of an OTT platform. The challenge also lies in the fact
that many OTT platforms in the process of giving a tough competition to other brands end up
giving premium content at no cost for the customer and thus end up losing their revenues in
order to win the customer over. However, some of the respondents did mention that if they
changed their consumption pattern from television to OTT, then they would not only be able
to watch the content of their choice and the time of their preference, but they would also be
paying lesser amount of subscription than what they would pay for the television. This insight
is in fact interesting, that television as a consumption medium is basically a wastage of money
in terms of the amount paid to cable operators and the redundancy of the plethora of channels
present in the television. The television offers around thousand channels in some operators
and the price that has to be paid is high as the whole package has to be taken and hence
television becomes an expensive medium. However, OTT platforms are customized and
hence the viewer pays exactly what the viewer wants to pay and not any additional cost of any
channel for which the viewer is not interested.
The competition of the OTT platforms is thus not only among themselves but also with
other media for that matter. As a result, the marketers of OTT platform needs to educate the
audience that they are actually paying for what they are watching in terms of the OTT
platform but in terms of television, they are paying even for what they are not watching and
hence television is an expensive medium in comparison with the OTT platforms. Consumers,
till date are more attracted to the free OTT platforms than the paid ones because their
perception is that OTT is an additional entertainment medium. The moment consumers are
made aware that OTT platform is not supplementary but complimentary to television, then
their perception towards cost of paying for the medium will change. Consumers need to be
educated that OTT platform comes as a replacement to their television viewing because the
consumers get to watch exactly what they want and pay exactly what they watch. This process
of awareness would slowly change the mindset of the consumers and they would start
switching to more paid platforms than the free ones. This process may in the future lead to
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lesser viewing of television but more effective viewing of OTT platforms in terms of
investment by a consumer for entertainment expenditure.
These are the major four factors that may lead to a certain consumer adopt this new
medium of OTT branded platforms or be indifferent towards the platform. Marketers and
brand managers need to concentrate in these four areas to create traction about these platforms
and their brands.
8. CONCLUSIONS
This research is a novel attempt to not only discuss how consumers will adopt to a certain
new meta-medium known as the OTT platform but to also understand its repercussions in
terms of what is in store for the future in terms of media consumption. In other words, if
customers adopt to the OTT format, what will its consequences be in terms of television
viewing. The reason of comparing television with OTT platform is that both are audio-visual
in nature, the usage of both media are similar and both media provide similar gratification.
While comparing OTT versus television, all 35 respondents said that their television
consumption patterns have been reduced to being minimal post introduction of OTT
platforms. 25 out of 35 respondents claimed that OTT platforms were much better than
traditional video consumption media vehicles like television.
With the internet and mobile penetration increasing by the day, the future of OTT looks
bright. Although people have started investing a lot of time and money on OTT platforms, it
is difficult to say that it will ever replace television as a primary video consumption platform.
The pricing strategies of almost all OTT platforms is currently at a substantially higher side
for the Indian consumer and thus is leading to a high dissuasion by them towards becoming a
regularly paying customer. Despite having tie ups with multiple brands and gaining and
attracting multiple brands to collaborate with the platforms, OTT channels are finding it
extremely difficult to maintain a steady streamline of revenue and thus are highly dependent
on paying subscribers for their revenues. Data consumption is one of the key concerns that
millennial have. Although with tough competition being given by multiple telecom providers
in terms of data plans, the consumption levels of data on OTT platforms remains similar and
thus making no substantial difference to the overall cost that the end consumer ends up
bearing to view the content on the platform. It was also realized the millennial specifically are
on the lookout in specific genres that suit their need and do not appreciate replication of
content especially if it is available already on the internet or traditional channels like
television. Thus OTT platforms must always be on a lookout for avenues to create and
provide more attractive and highly engaging content that isn’t available elsewhere. The
unfortunate problem in this case is that not all OTT platforms have the financial capabilities to
pursue new production of video content, thus making it almost next to impossible for newer
and smaller OTT platforms to create and generate newer content that specifically caters only
to OTT platforms and devices.
The implications are significant for marketers from this paper. Marketers need to
communicate to the consumers that OTT platforms are a part of their convenience need which
has become part and parcel of everyday life. On top of that, consumers are free to watch any
content anytime and anywhere. However, special care has to be taken not only to stream
content but to create and innovate content. In today’s world, content procurement is easily
available and hence newer content needs a lot more creativity and engagement visuals.
Finally, the subscription cost is another hindrance to the free flow of this platform and most
people prefer free videos than paid videos. The marketer needs to communicate that their
brand provides maximum convenience, portable and movable anywhere, extremely
contemporary, interactive and useful in terms of content and finally the consumer is paying
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what the consumer is watching and no additional payment is done unlike other media. This
awareness will lead to higher levels of equity of the OTT platform with the consumer.
However as a fallout of more adoption of OTT platform, television may lose a bit of customer
base as OTT platforms are more related to the lifestyle of the millennial. Television may
redefine another target audience as niche leaving the millennial consumers to the instant on-
the-go medium like OTT.
In conclusion, there is a huge need to streamline the entire process of OTT market in
India. Content makers and technology providers need to specifically focus on creating a
platform which can cut through the clutter and make all of the available video in an integrated
fashion. On the other hand, users and subscribers also need to understand that it may not
always be possible for the OTT platforms to end up providing an integrated video content
platform for free and that it is for providing a better viewing experience that the OTT
platforms function the way they do in its current fashion.
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