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Domestic pay revenues to drive broadcaster profits – JP Morgan CAS report
MUMBAI: JP Morgan India’s report on the Indian cable industry titled: “CAS: The Medicine for a chronic ailment” believes that the full implementation of the CAS (conditional access systems) would lead to an rapid growth in broadcaster revenues and ensure that domestic pay revenues will become the key driver of profits.
The Morgan report adds that pay revenues have continued to grow strongly in the recent past led by increasing declarations and continuous fee hikes in the industry. It specifies that the impact of CAS could be to redefine the broadcasters’ revenues.
The Morgan report reasons that broadcasters have gained through increasing pay revenues in the last 3-4 years. As the revenues come without much attendant costs, the “pay revenues” have helped profitability of channels significantly. As per Table 1, the pace of pay revenues has been increasing since the past years.
A case referred to in the report was Zee. The report estimates that the company would have close to Rs1.6 billion from the domestic pay market in FY03. These revenues would be the key driver of profits in years that advertising revenues of the network are weak. The report also adds that for Star TV, pay revenues form about one third of total revenues.
Broadcasters: pay revenues increase likely to propel fall in channel rates
The report envisages that the broadcasters have to bring down their channel rates with the advent of CAS; that is, if one goes by their promise of bringing down rates if declaration levels improve.
As is shown in Table 6, the net impact on channels should be marginally positive only. In the above calculations, the report has assumed a 60 per cent box adoption which might be slightly on the higher side. However, one must note that this assumption compares with a declaration rate of 30 per cent currently (which is higher than an all India rate of between 15-20 per cent).
The Morgan report has taken higher rates into account, as the analysts believe that the addressable market for broadcasters is lower than the total reported homes in the country. There are a huge number of cable homes in rural areas, which will be tapped only over a period of 5 years.
Given that the first phase of rollout is in metro areas, the Morgan reports believe that the concerns there are overblown. Since metros are controlled by MSOs and since declarations are the lowest from metros, the impact on pay revenues should actually be positive. The negative impact, if any, would likely be with very high pay connectivity channels, i.e. channels belonging to Star Plus.
Broadcasters: impact on advertisement revenues unclear
The impact on advertising revenues is not very clear at this point in time. There are two extreme schools of thoughts. The first viewpoint is that the channels would have to become free-to-air to get ad revenues after CAS gets implemented. The second viewpoint is that there would be no impact on ad revenues, as the opportunity to the advertiser would continue to lie with the successful channels only.
Morgan’s analysts believe that the actual truth would be somewhere in between. On an overall medium term basis, they believe that CAS would lead to a well regulated, better managed cable industry with few revenue leakages in the system. This can only be positive for all market participants in the medium term. The uncertainty is on how would the ad revenues behave till the time rollout of boxes takes place fully.
Again, since the first phase of rollout is in metros, which are relatively affluent, the box adoption should remain reasonably high. Thus the initial impact on ad revenues should remain minimal.
In the longer term, the report assumes that there could be hybrid strategies being adopted by various networks. This could include keeping some channels as pay and making some channels FTA.
Will Bundling Continue Post CAS?
Currently, the channels are sold in bundled form to the customer. The report believes that the advent of CAS would not mean that bundling would go away. The existing bundles would continue to offer bundled entertainment solutions to customers in order to maximize pay revenues for marginal channels.
Broadcasters/Distributors – three main bouquets have arisen
The report points out that Star, Zee-Turner and Sony (One Alliance) form the three main broadcasters in the market.
Structure of the pay bouquets – six main clusters
As far as the structure of the pay bouquets is concerned, the report says that there are six primary pay bouquets existing in the cable TV market-Zee-Turner, Star package, Sony (One Alliance), ESPN-Star Sports, Modi Entertainment Network (MEN) and Sun TV Network (regional). Additionally, there are certain standalone pay and Free-To-Air (FTA) channels. Overall, the total number of channels that a consumer gets in the city is in the range of 75-85. Table 2 below shows the mapping of the channels by segment.
Subscription rates have been rising steadily
The report claims that the problem of low disclosure for the broadcasters has led them to a strategy where they try to offset under-declaration losses with greater rates.
Subscription rate hikes have been a regular feature once a year and at times twice a year for the bouquet. From the initial Rs2/month pay rates for Star Movies in October 1994, the pay TV rates have seen substantial rise.
Table 3 shows how the rates of the five bouquets have changed over the past one year. Table 4 shows how the rates will increase in 2003.
Zee-Turner Bouquet’s strength is its breadth
The report feels that the Zee-Turner bouquet has a lot of breadth despite the fact that Star Plus is clearly the most popular channel. Additionally, Sony’s MAX, with the cricketing rights, is likely to draw large viewership during World Cup in February and March 2003 and the flagship Sony channel has usurped the No. 2 position from Zee TV. However, the report claims that the Zee-Turner bouquet provides the strongest value for the customer. Despite the current drop in popularity of the flagship channel Zee TV, the analysts believe that the drivers for the Zee-Turner bouquet are much more sustainable than the Star bouquet or One Alliance (Sony).
The report claims that it has checked its hypothesis with several cable operators. Nearly all of them felt that, ratings notwithstanding, the popularity of the Zee bouquet is certainly comparable to the Star and Sony bouquets. The operators opine that Zee TV has bottomed out and that they have definitely noticed an increase in Zee TV’s visibility. Additionally, these operators feel that there is a demand for other channels in the bouquet like Zee Cinema, Zee News and Alpha.
MUMBAI: 2025 will be remembered as the year India’s OTT industry stopped chasing scale for its own sake and began reckoning with how audiences actually consume content. Completion rates fell, patience wore thin and the limits of long-form excess became impossible to ignore. In this guest column, Pratap Jain, founder and CEO of ChanaJor, traces how micro-drama moved from the fringes to the centre of viewing behaviour, why short-form fiction emerged as a retention engine rather than a trend, and how platforms that respected time, habit and emotional payoff were the ones that truly grew up in 2025.
If there is one thing 2025 will be remembered for in the Indian OTT industry, it’s this: the industry finally stopped pretending.
Stopped pretending that bigger automatically meant better.
Stopped pretending that viewers had endless time.
Stopped pretending that scale without retention was success.
What began as a quiet reset in 2023 and a cautious correction in 2024 turned into a very visible shift in 2025. Business models matured. Content strategies tightened. And most importantly, platforms started aligning themselves with how Indians actually watch content, not how the industry wished they would.
At the centre of this shift was micro-drama—not as a trend, but as a behavioural inevitability.
When OTT finally understood the time problem
For years, long episodes were treated as a marker of seriousness. A 45–60 minute runtime was almost a badge of credibility. Shorter formats were pushed to the margins, labelled as “snack content” or “mobile-only.”
That belief quietly collapsed in 2025.
What platform data showed very clearly was not a drop in interest—but a drop in patience. Viewers weren’t rejecting stories. They were rejecting commitment.
Across platforms, the same patterns appeared:
* First-episode drop-offs on long-form shows kept increasing
* Completion rates continued to slide
* Viewers were sampling more titles but finishing fewer
At the same time, shows with episodes in the six to 10 minute range started showing the opposite behaviour: higher completion, higher repeat viewing, and stronger daily habit formation.
Micro-drama didn’t win because it was short. It won because it respected time.
Micro-Drama didn’t arrive loudly. It took over quietly.
There was no single moment when micro-drama “launched” in India. It crept in through dashboards and retention charts.
By mid-2025, it was clear that viewers were happy watching four, five, sometimes six short episodes in one sitting—even when they wouldn’t finish a single long episode. Romance, relationship drama, slice-of-life conflict, and grounded comedy worked especially well.
This wasn’t disposable content. It was compressed storytelling.
In shorter formats, there was no room for indulgence. Every episode had to move the story forward. Weak writing was punished faster. Strong writing was rewarded immediately.
Micro-drama raised the bar instead of lowering it.
Where ChanaJor naturally fit into this shift
ChanaJor didn’t pivot to micro-drama in 2025 because the market demanded it. In many ways, the platform was already built around the same viewing behaviour.
From the beginning, ChanaJor focused on short-to-mid-length fictional stories that felt close to everyday Indian life—hostels, rented flats, office romances, small-town relationships, young people figuring things out. Stories that didn’t need heavy context or cinematic scale to connect.
What worked in ChanaJor’s favour in 2025 was clarity:
* A clearly defined audience
* Tight episode lengths
* Storytelling that prioritised emotion and pace over spectacle
While several platforms rushed to copy global micro-drama formats, ChanaJor stayed rooted in familiar Indian settings and conflicts. That familiarity mattered. Viewers didn’t have to “enter” the world of the show—it already felt like theirs.
Why audiences started responding differently
One of the biggest misconceptions going into 2025 was that audiences wanted shorter content because their attention spans had reduced. That wasn’t entirely true.
What viewers actually wanted was meaningful payoff per minute.
On platforms like ChanaJor, episodes didn’t waste time setting the mood for ten minutes. Conflicts arrived early. Characters were recognisable within moments. Emotional hooks landed fast.
A typical consumption pattern looked like real life:
* One episode during a break
* Two more before sleeping
* A few the next day
This is how viewing habits are built—not through marketing spends, but through comfort and consistency.
Viewers came back not because every show was a blockbuster, but because they knew what kind of experience to expect.
2025 was also the year OTT faced business reality
The other big change in 2025 was on the business side. Subscriber growth slowed. Discounts stopped hiding churn. Customer acquisition costs rose.
Platforms were forced to ask harder questions:
* Are viewers finishing what they start?
* Are they returning without reminders?
* Is this content worth what we’re spending on it?
This is where micro-drama began outperforming expectations. A well-written short series could deliver sustained engagement without massive budgets. It didn’t peak for one weekend and disappear—it stayed alive through repeat viewing.
Platforms like ChanaJor benefited because they weren’t chasing inflated launch numbers. The focus was on consistency and retention, not noise.
Failures Became Visible Faster
2025 also exposed weaknesses brutally.
Several platforms assumed micro-drama was a shortcut—short episodes, quick shoots, instant traction. What they discovered was that bad writing fails faster in short formats than in long ones.
Viewers dropped off within minutes. Episodes were abandoned mid-way. Weak stories had nowhere to hide.
Micro-drama didn’t forgive laziness. It amplified it.
The platforms that survived were the ones that treated short storytelling with the same seriousness as long-form—sometimes more.
OTT Stopped Chasing Prestige and Started Chasing Habit
Perhaps the most important shift in 2025 wasn’t technical or creative—it was psychological.
OTT stopped trying to look like cinema. It stopped chasing validation through scale and awards alone. It began behaving like what it actually is in people’s lives: a daily companion.
Platforms like ChanaJor found their space here because that mindset was already baked in. The goal wasn’t to dominate a weekend launch. It was to quietly become part of someone’s everyday viewing routine.
That shift changed everything—from release strategies to how success was measured.
What 2025 Ultimately Taught the Industry
By the end of the year, three truths were impossible to ignore:
* Time is the most valuable thing a viewer gives you
* Retention matters more than reach
* Format must follow behaviour, not ego
Micro-drama didn’t take over because it was fashionable. It took over because it fit real life.
Looking Ahead
Micro-drama is not replacing long-form storytelling. It is redefining the baseline of engagement.
Longer shows will survive—but only when they earn their length. Short-form fiction will continue to evolve, becoming sharper, more emotionally confident, and better written.
Platforms like ChanaJor have shown that it’s possible to grow without shouting—by understanding the audience, respecting their time, and telling stories that feel real.
2025 wasn’t the year OTT became smaller. It was the year it became smarter.
Note: The views expressed in this article are solely the author’s and do not necessarily reflect our own.
