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Zee is reworking Ditto TV strategy after dropping prices last year

Zee Entertainment Enterprises Ltd. (ZEEL) is looking to revamp the company’s OTT strategy for Ditto TV. Admitting to the significant under performance of Ditto TV in comparison with STAR TV’s Hotstar, during the earning call in Q3 FY17, Punit Goenka, MD & CEO of ZEEL noted that the company plans to roll out the new strategy during the second half of the current calendar year. When asked about the Ditto TV’s numbers, Goenka declined to comment on it stating that it would be irrelevant to disclose numbers, with the changing strategy. Note that Ditto TV had clocked close to 200 million video views for quarter ending Q2 FY17. Further, Goenka added that DittoTV went live on major telecom operators’ platforms, which he thinks should drive subscriber growth.

In an attempt to increase its subscriber base, Ditto TV had cut down its subscription fees to just Rs 20 per month, from around Rs 150 per month in June 2016. It is worth noting that the choice of pricing at Rs.20 per month mirrored the ARPU (Average Revenue Per User) that Ditto TV made for the quarter ended 31st March 2016. In October 2016, Ditto TV had entered into a bundling partnership with Airtel that would make available its content to Airtel subscribers. Ditto TV has over 100 TV channels, including from its parent network Zee, and others like Colors, Sony, SAB, Zoom, MTV, BBC, Times Now, MTV and Aaj Tak.

Interestingly, in the same quarter ending Q3 FY17, Eros Now service owned by Eros Plc, also a competitor of Ditto TV, claimed to have crossed its target of 2 million paying subscribers for its service, a quarter earlier than expected, and has set a 5-year target of at least 15-20 million subscribers worldwide with a blended annual ARPU of $5 from India and $30 internationally with 80% of the target subscribers from India and the remaining 20% internationally. Eros Plc CEO Jyoti Deshpande had said that “a television company owned OTT services (Ed: referencing HotStar, Sony LIV, Ditto TV?) predominantly serve as a substitute for catchup TV and continue to drive an adserve-free model”. Eros does 5-9 year deals with telecom operators.

Zee has pulled its content from YouTube

Speaking about the company’s online streaming platform, OZEE, Goenka said, “The overall digital pie is still dominated by search and video is a fraction of that number.” That said, Goenka noted that all of Zee’s content pulled out of YouTube and is only available on OZEE. He added that the platform has over 40 million video views per month and that there has been a significant increase in revenue compared what the company was generating from YouTube. ZEE Digital launched its video on demand, OZEE in February 2016.

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