SUMMARY
Over 200 Mn Indian internet users have embraced music streaming services, but the addressable base for podcasts is far smaller
As of today, India’s podcast landscape comprises 40+ players, including local and international platforms as well as aggregators
While primary focus areas are Hindi and English podcasts, startups focusing on regional content have attracted major funding in the Indian market
India’s affinity to audio content and music goes back to the 1950s when AM and FM stations began growing in popularity along with the All India Radio broadcasts. Now with more than 369 private and 450 FM stations, India’s radio industry reaches 99% of the listeners across the country and is the biggest mass media platform for advertisers in modern times. Of late, the craze for on-demand audio content is pushing Indian millennials towards the dynamic industry of music streaming as well as the podcast industry.
While over 200 Mn listeners are estimated to be using music streaming services, those looking for non-linear audio content (talk shows, audiobooks, storytelling, and more) are shifting gradually to podcasts.
As of December 2019, 40 Mn Indian internet users have listened to podcasts in India. Although, this market is just one small fraction of the bigger OTT video and music streaming industry.
However, if compared to western markets, India has all the right growth variables. The emergence of digital marketing to grab more users and revenue, entry of celebrities in podcast creation (Neha Dhupia, Kunal Kapoor, Kalki Koechlin and others); entry of foreign players (Spotify, Audible, Apple Podcasts, Audioboom and others); adoption of podcasts as a content stream by media companies (Hindustan Times, BBC, NPR etc.) as well as local music streaming platforms such as JioSaavn, Gaana have all played a crucial role in the growth of podcasts in the Indian market.
Also, the top two markets for podcasts, the US and China are already moving into consolidation and late-stage growth phases. Recently, Spotify acquired podcast centric startups, Gimlet Media and Anchor. Similarly in China, Ximalaya FM has already gained unicorn status. In comparison, the Indian market is ripe and untouched.
In 2019, international players in India claimed that podcasts were a key channel of growth in the local market. Spotify claimed 19% growth on account of podcasts while Audioboom showcased a 52% revenue hike in Q12019.
The Podcast Landscape In India
The term podcast was first introduced in the early 2000s when Apple moved audio shows to its ‘broadcast’ network iTunes and bundled with its flagship product ‘iPod’. While globally, podcasts became a charm, in India it took a flip side. Rather than a mass product, podcasts were seen more of an Apple product feature, catering to only 1% of the Indian population.
“And so began the alienation of podcasts and all they stood for,” Gautam Raj Anand, founder & CEO of Hubhopper said in the company’s podcast report for 2019-20
It was only between 2015 and 2019 that India saw a huge number of users coming online and looking for differentiated content, and when enterprises started exploring podcasts as a content form. The key factors driving this growth are deeper internet and smartphone penetration, cheaper data packs, the rise of digital payments and diverse business models.
Business Models
The podcast ecosystem can be currently divided into four key categories catering to the demand and supply side of audio content: creators, content aggregators, enterprises and corporations offering podcasts as a value-added content, and support service providers.
Considering the podcast is still a naive industry in India, many players are experimenting with different categories, offering an umbrella of services with an overlap of these categories.
Key Players And The Support Ecosystem
As of today, India’s podcast landscape comprises over 40 players, including local and international companies. These platforms are operating across multiple categories in a cross-functional manner. Most players are still experimenting to find the right market positioning for themselves. Here’s a brief overview:
Regional Language Focus
While primarily, podcasts are consumed in Hindi and English, startups and companies such as Khabri, Hubhopper, Kuku FM, Headphone, IVM, Podbean are focusing on regional languages as well.
Understanding Podcast Creation And Distribution
There are ideally two types of audio content: user-generated content and professional content. Typically, there is a vast difference in quality and cost between the UGC and professional content.
“It’s similar to a user creating audio for YouTube, and Netflix creating a podcast for its audience,” said Sreeraman Thiagarajan, founder, Aawaz
User-Generated Content
Anyone can create and distribute podcasts simply by using a mic, or a smartphone recorder and any audio editing tool. A few prerequisites are noise-free recording room, subject matter expertise, and a few editing and distribution tools. These tools are mostly available for free or have freemium trial versions available, with Audioboom and Audacity being the more popular choices.
Platforms such as HubHopper, Vaaka Media, Kuku FM, Podbean and Khabri offer users a free end-to-end platform to create, filter, edit, distribute and monetise podcasts and other forms of digital audio content.
Professional Content
This requires in-house professional expertise and large investments for recording studios. There are individual enterprises, which again use platforms like HubHopper (on premium) or have an inhouse team to create and distribute professional-quality podcasts. This includes the likes of IVM, HT Media, Quint, BBC, NPR and more.
Then, there are independent professional content production houses such as Aawaz, IVM, Headphone among others. These platforms look for distribution platforms to promote, share, licence their podcast content APIs on content aggregators, streaming platforms such as Gaana, Spotify, JioSaavn, Ola Play, Saregama and others as well as by opting for premium individual audio content hosting, distribution, advertising and promotion services through Anchor, Audioboom, Soundcloud and more.
Standalone Podcasts Not Viable For India
Digital audio content or podcasts are still a nascent industry in India. The awareness is quite low and even though this has the lowest entry barrier, not many are aware of the various discovery channels, distribution strategies, editing, production and more.
“Another challenge is that though brands are excited about podcasts, they don’t have much knowledge of utilisation and pricing aspects. This creates a little fear. These are more deep-rooted problems. And as time goes on, they need to be more educated about the space,” said HubHopper’s Anand.
Indian audiences are fairly new to experimenting with audio content beyond radio or music. For most, the podcast is still an alien term. Aawaz’s Sreeraman believes audio in India is still associated primarily with music, news updates and cricket commentary.
“While music streaming players like Gaana, JioSaavn had a repository of songs from 50-60 years of Bollywood industry, the Podcast industry had to build all content from scratch whether original or recording the existing content,” said Aawaz’s Thiagarajan.
Plus, the price-sensitive Indian audience looks for value at each step. Thus, in order to attract these users, podcast platforms are exploring and aggregating a wider variety of content. A lot of awareness needs to be built around audio content to push the new audio streaming users towards podcasts in the near future.
Monetisation Is Still A Tall Order
The OTT video and music streaming players have been around in India for half a decade or more. And it’s only now that consumers have started adopting them in any substantial manner. Indians are still coming to terms with paying for content and audio content is lower on their priority list than video. In that respect, the podcasts industry still has a long way to go.
“It’s more about creating adoption right now. Build habits and then introduce the payment modules. Its more about people getting comfortable in paying for online content whether audio or video, will not matter, that’s a behavioral shift anyways happening,” said Pulkit Sharma, cofounder, Khabri.
On the other hand, the podcast creation and distribution side is dealing with the chicken and egg situation. Podcast platforms need listeners to get more creators and vice versa. The new players or individual creators are required to devote a lot of time, data and money to acquire loyal listenership across platforms and thereby attract brands.
This cannot be initiated from day one through the use of the right platforms. Platforms like Hubhopper (2015), Castbox (2016), Khabri (2016), IVM (2015) have been around for over three years and have key monetisation models in place
Primary Revenue Models
For Platforms
- Licensing, Native advertising, Sponsorships (e.g. Aawaz, IVM)
- Premium subscriptions (e.g. Castbox, Audible Suno)
- Enterprise commission, Revenue-sharing, API access (e.g.HubHopper)
- Events, Merchandise, Content marketing
For Creators
- Advertisement
- Crowdfunding
- Live streaming
- Content creation as a service
- Donations
The growth of international players has raised the interest of users and enterprises as well as investors in podcasts. Although the Indian startups and companies are still experimenting with revenue model, investors have not been shy about making investments in podcast players. The likes of HubHopper, Khabri, Aawaz, KukuFM, Headfone among others have attracted major funding in this space in the past five years.
Recently, the Covid-19 pandemic has pushed the adoption of streaming services and traction for podcasts in a short span. With production houses under lockdown and travel restrictions, podcasts are becoming the new battleground for content creators. Even in places where internet connectivity is not steady, podcasts are less of a bandwidth burden than video.
According to reports, downloads on podcast platforms including Aawaaz.com, IVM, Audioboom, Hubhopper, and Ep.Log have jumped 8-30% over the last two weeks.
“We have seen an 18-22% increase in listenership over the last ten days. Usually, we have increased listenership during morning and evening, but now we get people through the day,” said Thiagarajan.
The growth is slow, still, the current market trends indicate an optimistic future growth.
In China, the content is inclined towards learning and motivation, storybook narration, and audiobooks. In the US, it has been a typical conversation podcast play. “In comparison, given the different geography and varied consumer behaviour, India is bound to have multiple players with the podcast as part of the broad umbrella of audio content offerings,” said Khabri’s Sharma.
Others believe podcasts will lead the growth of subsectors such as production software and related services such as audio engineering, transcription services, news aggregators, recommendation and discovery algorithms and more.
Long-form podcasts will be preferred as more and more users come on board. Podcasts can range from five minutes to 2 hours in duration, but on average, episodes last 15-30 minutes. With increased penetration of podcasts in tier 2 and tier 3 cities, podcast genres will also widen along with the increase in duration.
Being an unsaturated and new market for both local and global players, the Indian market is a golden opportunity for podcasters as well as the ecosystem around podcasts. This is also a huge opportunity for the radio industry to digitise redundant data and pull in loyal listeners for their channels through podcasts.
