OTT market being built, monetisation will follow: Applause's Sameer Nair

The OTT market is just discovering itself; it is the land grab phase. Monetisation will happen in a bit, says Nair

What are the big changes from your KBC and Star India days? 

One big difference since the early the 90s is then we were creating content, throwing the cables, building distribution, content and even the ad industry. Today distribution is in place, the whole e-commerce industry has built a degree of trust therefore people are happy to buy video online. Over the years, the rise of news channels had destroyed other content genres, it killed the late night talk shows. In the last three/four years various industries — devices, payments, telecom — have got together and created the perfect storm. Everything has fallen into place — storytelling, consumption. 

How has the process of development changed post the OTT boom?

It takes between 12-24 months to develop a show. Ideally, it should take 12-15 months, but not less than 12 between writing, casting, direction, post production. A drama series is like three-four movies. You want to work with better actors, writers, directors and all of it is on location. In TV, you air an episode and it is gone. Drama sits on the platform.

The big problem with content businesses is always scale..

Not everything needs scale. In the creative business, scale means different things. In B2C, there are billions of customers therefore scale is needed. For example, Netflix has 150 million customers. We are in the attention business; we need your attention and need you to like it. For us, scale is a reputation for getting audiences. For making an ambitious, audacious, disruptive show. That is my scale. My scale is not 100 shows. We don’t need to be valued at trillions of dollars. PVR screens movies and is about scale. Scale can be in quality, quantity or impact. In the next five-ten years, we need the company to be known for what it does. When we set out, we made a bunch of series on our own and pitched them. Now the sense is that we need to involve the platforms. Some of our content we own, some we don’t. We are not fixed and fussed about things. We think the market is just discovering itself. It is not for anyone to make the rules. Also if you see from the platform’s point of view, they are trying to discover their audience. 

What about monetisation?

There are two parts to monetisation — building a market and then the monetisation. The market is being built now. Even TV took its time. We lost a lot of money on TV before it started making money. All through the 90s till the early 2000s... TV got into its stride from 2010. For nine years, it has had a good run. But TV is last century’s medium, it is gradually winding down. Our children will not be cord cutters but cord nevers.

Monetisation will happen, this is the land grab phase, the first cycle. Google was the seventeenth search engine but eventually became the largest, so this is the evolution phase. 

The biggest revenue source online is advertising and that needs aggregation. The net’s biggest strength is it disaggregates. This pushes down ad rates. How do you tackle this conflict? 

Advertisers have historically referred to our business as media vehicles, like “we want to sit in your taxi and go to Gurgaon”. Whereas the media guy says let me take you through this scenic route, so that would mean an ad-break in KBC. On the other hand, Netflix has 150 million consumers who do not consume advertising for three hours a day so marketers are going without audiences. The most hit button online is the “skip ad” button. These are problems marketers will solve. Just like linear made the lowest common denominator (in programming) imperative, the internet makes disaggregation an imperative. Disaggregation is a different form of unification because there are unifiers.  Everybody will see House of Cards or Game of Thrones but over time.

How do you deal with the lack of a common metric?

In the early days of TV, too, there were no audience numbers but we knew that this was a “very Sony show” or a “very Star show”. You think TAM ratings told the story? No. The biggest story of KBC was when you walked the streets and heard the sounds of the show going on air. These are early days for streaming. I use the fact that season two has been commissioned as an indicator that the show has worked for whatever it is worth. Season two means something. So it doesn’t matter if there are no audience numbers. Plus you get validation from critics, though your echo chamber.