The great eyeball chase: How India’s digital storytellers are leaving TV behind

INDIA’S MEDIA AND entertainment sector reached ₹2.5 lakh crore in size last year, registering a modest growth of 3.3% — a sharp decline from 8.8% seen in 2023. The slowdown was primarily driven by falling subscription revenues, a drop in outsourced animation and VFX work due to the Hollywood writers’ strike, and sluggishness in the Indian content market. The good news, however, is that it is far from a doomsday situation — the past year has actually been a milestone of sorts with digital revenues surpassing television. According to the 2025 Ficci-EY media & entertainment report, digital contributed ₹80,200 crore to the revenues of the sector in 2024, while TV’s 25-year-old monopoly ended with its contribution declining to ₹67,900 crore. Though the Sony-Zee merger fell through, the industry also saw one of the biggest-ever M&A deals, the $8.5 billion merger of Reliance Jio and Disney-Star. Unlike Hollywood, where content creation companies are all-powerful, Indian content houses have traditionally been small mom-and-pop creative outfits riddled with governance issues. Unlike the West, where the balance of power rests with content companies who own the intellectual property (IP), most Indian content studios are commissioned shows either by broadcasters, or streaming platforms. In fact, Ronnie Screwvala-owned UTV was perhaps one of the few to receive corporate funding. It was acquired by The Walt Disney Company for ₹2,000 crore in 2013, with Disney eventually writing off the investment. A decade later, Adar Poonawalla, CEO, Serum Institute of India, bought a 50% stake in Karan Johar’s Dharma Productions for ₹1,000 crore. While grapevine has it that Poonawalla actually saved Johar from big trouble, Gaurav Mehta, partner and head-India, Raine, the investment banking firm that negotiated the deal, says what worked out in Dharma’s favour was that it owned the IP of 70-80% of the content. “Dharma has valuable IP which can be monetised. Karan has demonstrated the ability to deliver big hits, and Dharma’s content resonates on theatrical as well as on the OTT side.” “The company is run with a high degree of financial prudence. Even if a particular movie didn’t become a box-office hit on theatrical release, they are able to defray 70-80% of their production cost by pre-selling rights. They would pre-sell smartly, be it digital rights, satellite, or music,” Mehta further explains. Soon after the Dharma deal was announced, Roy Kapur Films owned by former Walt Disney India MD Siddharth Roy Kapur announced its intent to raise $50 million through equity investment. Vikram Malhotra, founder and CEO, Abundantia Entertainment, also plans to raise ₹200-250 crore to fuel his content creation plans. The power of IP A majority of Indian content studios work on a commission model, where the platform commissions the content and owns the IP. “Some production houses have the muscle to own the IP or co-own it, some don’t. A lot depends on your bargaining power, or rather, your level of poverty,” laughs Ram Madhvani, founder, Ram Madhvani Films and Equinox. The bigger ones, such as Jio Studios and Aditya Birla Group’s Applause Entertainment, follow a licensing model. They first create content and then ink deals with content platforms. They own the IP for the content. “We license our shows and retain the IP. We are a traditional movie studio model rather than a commercial studio model. This gives me creative ownership,” explains Sameer Nair, CEO, Applause Entertainment. Similarly, Jio Studios, when it greenlights a film, doesn’t decide at once whether to first release the film in theatres and then license it to a streaming platform, says Jyoti Deshpande, president, media and content business, Reliance Industries. “When we do tentpole films with big budget, star cast and production values, we obviously want to monetise across platforms, but when we make a small movie with a heart like Laapataa Ladies, Article 370, Mrs., and Dhoom Dhaam — all made within a range of ₹15-25 crore — we decide how to treat them on a project-to-project basis.” “We wanted to bring Article 370 to the theatre because we wanted to tell the story of India shining to a large number of people. Laapataa Ladies, on the other hand, was a perfect storm. When we tested the film, we realised both men and women were loving it, so we brought it to the theatres, and then took it to Netflix,” Deshpande explains. Both Jio Studios and Applause have the power to decide what to do with their content because they own the IP. Their backing by deep-pocketed conglomerates also enables them to operate on a licensing model, unlike smaller content creators. To take its stories to the world, Jio Studios needs a generous risk appetite and Deshpande is willing to take that bet. “We want to ideally split the global rights into India only and international. Currently, a digital platform takes away global rights, which limits international distribution country by country. We will [now] try to work that film from a Berlin or Cannes, get a sales agent and sell in North America, Germany, France, and other parts of Europe — around 100-135 countries. We will then try to release it theatrically and do deals with local streaming services and broadcasters in those markets. If we do this with a set of films then our stories will start opening up in those markets.” Apart from distributing films, Deshpande is also looking at building franchises. She wants to build larger-than-life characters just as Marvel has done worldwide with Spider-Man and Transformers. “We are already building franchises around Stree, Thama, Bhediya, and Munjya. We are also doing Mahavatar, which is the story of Parasuram. This will be a big-budget behemoth, and introduce characters,” she explains. By the time Mahavatar releases two years from now, Deshpande hopes to get a foreign studio on board. “We don’t necessarily want their money. We want their distribution muscle,” she says. Though nowhere close to the scale of Jio Studios or Applause Entertainment, Banijay Asia is also looking at increasing its licensed content portfolio. The content company currently owns the IPs of reality shows such as Bigg Boss. “Currently our model is tilted heavily towards commissioned content, but going forward, we want to ensure that at least 40% of our original series in the Indian market is licensed. We will distribute our licensed content globally, through Banijay Rights, which sits within our company and is pretty much the largest distributor globally,” says Deepak Dhar, founder and group CEO, Banijay Asia and Endemol Shine. Investor interest Though Dharma has received a ₹1,000-crore investment and a host of other content companies are looking to raise funds, how investment-worthy are Indian entertainment companies actually? Mehta of Raine says though his investment firm is in talks with quite a few of them, he isn’t sure how many will convert into final transactions. “The question is how many can absorb more than $100 million capital at this point. There aren’t that many.” Jio Studios’ Deshpande agrees. “There aren’t too many companies you can invest in. They are so small. When you look under the hood, there is absolutely nothing — very small profit, lots of liabilities, and an individual who is at the helm. However, every now and then, you spot a gem.” “Can someone be our ticket to the Oscars? We have a vision, a mission, and a purpose. A company we acquire has to serve that purpose, it has to have potential for the future. If we have to pay for a company which only has deep legacy, but no synergy, we’d rather not invest,” she adds. Madhvani says there has been considerable investor interest for his virtual reality content arm. “There is a lot of artificial intelligence work we are doing and for that we need investors. On the series front, if we were to make it ourselves and then sell it, the question is, will we be able to sell it?” Indian companies are also open to creating content for diverse platforms, an attractive proposition for investors. Dharma Entertainment, for instance, not just makes big budget, star-studded films, it also produces relatively smaller projects such as Homebound, where the focus is much more on storytelling. It also has its OTT arm, Dharmatic Entertainment. Similarly, Applause recently launched its animation channel on YouTube. “We are creating a lot of content on YouTube, which is a creator network. We are setting up a separate strategy to create value there. With so many new content verticals coming up, there is definitely investor interest in content companies,” says Banijay Asia’s Dhar. Challenges ahead One of the main challenges Indian content houses face in scaling up is low revenue generated from theatrical releases. Despite the high number of film releases, theatre earnings remain limited due to a shortage of screens and relatively low average ticket prices. The pandemic further accelerated the decline of single-screen cinemas, while multiplexes, with their high pricing, struggled to draw audiences. Going forward, the real value is likely to come from digital monetisation. With a vast population and some of the lowest internet costs in the world, digital platforms are seeing increasing content consumption, offering greater potential for revenue. So, at what level of maturity is the Indian entertainment industry at? “It is very large from an engagement perspective, sophisticated from a tech point of view, but the industry is grappling with a transitionary period where monetisation hasn’t picked up yet. It is still at the investing stage where there are lots of customers and you know they are willing, and able to spend, but overall monetisation has not reached there yet,” explains Mehta of Raine. The good news, however, is that creators are beginning to think big and take Indian stories to the world. Fortune India is now on WhatsApp! Get the latest updates from the world of business and economy delivered straight to your phone. Subscribe now.

The great eyeball chase: How India’s digital storytellers are leaving TV behind

Sign in to read full story