Most free subscribers of music OTT apps ready to try paid models: report

At a time when the popularity of over-the-top (OTT) service providers is hitting the roof, a recent survey by research firm Redseer Consulting has said that majority of free users of the audio OTT apps are willing to switch over to paid versions if subscription rates are lowered. The survey, made among a sample user group, said 62 per cent of the respondents are willing to pay around Rs 25 per month as subscription fees in order to migrate to a paid model.

Additional features provided for the subscribed users such as no advertisements, facility to download content and offline browsing are the top reasons behind switching to a paid-subscription model, the report said.

This comes as many Indians are working from home amid the coronavirus outbreak, there has been a clear spike in viewership across several OTT video platforms in the past few weeks. Most platforms have observed at least a 20 per cent spike in viewership, especially in metros like Delhi, Mumbai and Bengaluru.

OTT audio platforms will also need to increase their current paid-subscriber base to six per cent of overall users from the current one per cent, to achieve profitability, it said. Currently, advertisements generate 60 per cent of these platforms' overall revenue while subscribers’ fees account for the rest. Redseer says that the subscriber-advertisements revenue mix is required to shift 80:20 per cent for these platforms to break even.

"However, average revenue from subscription per user is almost 80x that of revenue from advertisement per users. Thus, players are focusing on increasing their subscription user base to achieve profitability."

The players were also taking a cue out of the playbooks of the video OTT players, by focussing on original content. This move is aimed at increasing their paid-subscriber base and differentiate themselves from the rivals.

Gaana currently has over 70 songs under its in-house banner Gaana Originals while JioSaavn's Artist Originals has around 30 artists and 40 songs.

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