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.