Star India, the Indian media group controlled by 21st Century Fox, has launched its SVoD service Hotstar in the US and Canada. The monthly charge for Hotstar is $9.99 for the US and C$12.99 in Canada.
The Hotstar app can be downloaded from Google Play and Apple App stores. Hotstar can also be watched on smart TVs via the use of an Apple TV or a Chromecast device. The service allows up to two devices to be simultaneously connected. However the SVoD service is valid exclusively in the country where it originates, meaning that the US subscribers will not have access to their US service while visiting Canada and vice versa.
Star India has announced that due to copyright restrictions it cannot offer any content originating from the US and Canada (like HBO, CBS Showtime, Disney, FOX) to its US and Canadian subscribers. It can though offer access to more than 15 national Indian channels as well as to the biggest Indian cinema (Bollywood) blockbusters that it controls the international rights.
Hotstar is also offering access to Indian cricket (like the Indian Premier League) and other sports content (like kabbadi, badminton and hockey) which is very popular among the Indian diaspora.
The Indian online VoD market is vibrant. It is being reported in Indian media that 130 million Indians are streaming video nationally and IHS Markit TV Media Intelligence has counted around 20 standalone SVoD services operating in the country (both local and international) in Q2 2017. This figure does not count the multiscreen (TV Anywhere) services launched by pay TV operators like Dish TV, Tata Sky and Videocon. One of the major drivers of growth in online video until now has been the mobile operator Reliance Jio: first by launching a 4G mobile service which slashed the cost of accessing mobile data by over 65% in September 2016 and, second, by launching in summer 2017 a range of cheap smartphones affordable to the average middle-class Indian consumer.
Another factor has been the state of the Indian economy: GDP growth rate has been around 7% for the past decade and the Modi government has implemented a policy of tax cuts and salary hikes. The end effect is a rise in the disposable income of households and a higher predisposition towards spending for entertainment.
Hotstar rode the wave of growth of the Indian VoD market very successfully: It was launched in February 2015 as an AVoD service. In practice it served as a catch-up TV service for the 18 Indian national channels of its parent company. As Star India controlled a variety of premium sports rights (Indian Premier League online rights, English Premier League, NBA) it became apparent that the free offering of this content, via an AVoD service, did not offer the best value for money. In summer 2016 the company adopted a dual strategy, launching Hotstar Premium, a new SVoD service offering sports and mainly US movies and series. The service draws on Star's exclusive rights to HBO, CBS Showtime, Disney and privileged access to the extensive FOX library, offering uncut and ad-free HBO and Showtime shows released day and date with the US.
Hotstar Premium is competitively priced at $3 per month, around 70% cheaper than Netflix. The free and pay VoD services of Hotstar are accessible via Android and Apple devices, Apple TV and Chromecast. Understanding that the cost of data (especially mobile data) can be a big obstacle for the average Indian consumer to access online video, Hotstar has offered the option of downloading content.
Hotstar has a strategic partnership with Reliance Jio. Hotstar is the exclusive TV provider on Reliance Jio's mobile broadband platform and the VoD services (free and pay) are accessible via the new Reliance Jio smartphones that launched in summer 2017.
Star India claims that Hotstar is the most popular VoD service in India. The company announced that it had 100 million users in Q2 2017, however without providing a split as to how many were just using the free AVoD service and how many were actual subscribers to Hotstar Premium. Back in April 2017 Hotstar claimed that since its launch (February 2015) it had crossed 100 million downloads in Google Play Store and 200 million downloads across Google Play Store, App Store and other Android app stores cumulatively. According to these statements, the Hotstar app is the most downloaded app in India with 137 million downloads just in Q1 2017.
With its presence in India very well-established, Hotstar is planning to target the big Indian diaspora (estimated to be around 20 million). Hotstar is not the first VoD service targeting the Indian diaspora: IHS Markit TV Media Intelligence understands that there are around 10 OTT SVoD services (originating from India or other South East Asian countries) targeting the same demographic group, including EROS Now, SonyLiv, YuppTV, Spuul, Alt Balaji, Ditto TV and BoxTV. Hotstar might have an advantage over the other VoD services as it now holds a key strategic asset: the international rights for the Indian Premier League untill 2022. Cricket is the most popular sport among Indians while it also has a huge fan base in other countries in APAC, the UK, the US and Canada, offering Hotstar the tool to address the needs of these audiences as well. Logically, other countries with a big Indian expat community will follow. The UK, after the recent launch of the Sky Sports Cricket Channel, could be a key target market