More entertaining times ahead as home grown apps’ popularity, user base surge

With the world’s second largest internet user base and the highest data consumption, India is a big bet for domestic and international digital companies as a growth driver and money-spinner.

Right from the Dalgona coffee challenge to quirky music compositions like ‘Rasode mein kaun tha?’, social platforms brimmed with user-generated content this year despite lockdown challenges and the growing popularity of homegrown short video platforms promises to make 2021 even more engaging and entertaining for netizens.

With the world’s second largest internet user base and the highest data consumption, India is a big bet for domestic and international digital companies as a growth driver and money-spinner. Millennials in the country are not only consuming content on these platforms but also actively creating content across genres like comedy, dance and education, among others.

With the pandemic and the ensuing lockdown restricting movements, people turned to digital platforms for their dose of entertainment. They binged on web series on Netflix and Amazon Prime Video, and logged onto platforms like YouTube to learn new recipes and pick up new skills like playing the guitar.

Traffic grew manifold and platforms like YouTube, Netflix and Facebook had to work on mitigating mobile and broadband network congestion.

Around mid-year, the Indian government banned 59 apps with Chinese links, including the hugely popular TikTok and UC Browser, saying they were prejudicial to sovereignty, integrity and security of the country. Referred by many as a ‘digital strike’, the move came amid border standoff with China. Another set of 118 apps were banned in September, while 43 more apps were added to this list in November.

The list of banned apps included a variety of popular ones such as Alibaba Group Holding’s e-commerce app AliExpress, WeChat, PUBG, Baidu and Tencent Weiyun.

The development drew mixed responses from people in the country, especially given the popularity of TikTok and PUBG. The government has been categorical that while foreign investments and innovations are welcome, security of users’ data and safeguarding the interests of crores of Indian mobile and internet users will be paramount.

Blocking of these apps came as a boon for homegrown startups like Moj, Chingari and Kaagaz Scanner that saw downloads and usage zoom almost overnight. This rapid pace of growth also helped many of them raise funds.

VerSe Innovation received USD 100 million funding from Google, Microsoft and Falcon Edge’s Alpha Wave Incubation while vernacular language social networking platform ShareChat raised USD 40 million from Hero MotoCorp’s Pawan Munjal, DCM Shriram promoters’ family office, and others.

Kaagaz Scanner secured USD 575,000, Bolo Indya mopped up USD 400,000, and Chingari raised USD 1.3 million in seed funding. A big crowd puller was the fact that many of these creators are using local languages to connect with their audiences. According to a report by ShareChat, over 750 million user-generated pieces of content were uploaded onto its platform this year, with Hindi users accounting for 26 per cent contribution.

The Twitter-backed platform, which has over 160 million users — saw over 700 million hours of video content being consumed on the platform during the year, with 30,000 hours of videos uploaded on ShareChat daily. Bolo Indya, with its over 28 lakh-creator base, is focussed on helping them offer peer-to-peer commerce service, and thus monetise their skills.

Even giants like Google and Facebook jumped onto the bandwagon with ‘Shorts’ (Google) and ‘Reels’ (by Facebook-owned Instagram). These services were piloted in India, offering creators innovative tools to create short videos and sharing them with not just friends but also public at large.

The two companies have also made massive investments this year in the country. In April, Facebook picked up a 9.99 per cent stake in Reliance Industries’ Jio Platforms at Rs 43,574 crore (USD 5.7 billion).

In July, Google announced a USD 10 billion (Rs 75,000 crore) ‘Google for India Digitisation Fund’ to be invested over 5-7 years. Of this, Rs 33,737 crore was invested in Jio Platforms for a 7.7 per cent stake. Two Indian startups — Glance and VerSe Innovation (Dailyhunt) — have also received investment from this fund.

Facebook, which has over 400 million people using its family of apps (WhatsApp, Messenger, Instagram and Facebook) in India, drew flak this year for its handling of hate speech on the platform in the country. After a Wall Street Journal report alleged that Facebook’s content policies favoured the ruling party in India, questions were raised on the social media giant’s alleged bias.

The company has maintained that it remains committed to being an open, neutral and non-partisan platform. Facebook, which has faced criticism related to content on the platform and its handling in many countries, had set up an Oversight Board for content moderation in a transparent manner.

Facebook — which has 1.82 billion daily users globally — had recently stated that out of every 10,000 content views in the third quarter, 10-11 were hate speech. Twitter drew flak over data breach when cyber attackers hacked into the accounts of high profile users, including accounts of Jeff Bezos, Barack Obama, and Bill Gates, in a purported bitcoin scam.

The microblogging platform also came under heavy criticism in India on the issue of map misrepresentation. In October, India issued a warning to Twitter over its location setting that showed Leh in China, and in November, a notice was issued to the microblogging platform for showing Leh as part of Jammu and Kashmir instead of the Union Territory of Ladakh. The IT Ministry asked Twitter to explain why legal action should not be initiated against it for disrespecting the territorial integrity of India by showing an incorrect map.

The new year could also see more action on the data privacy front. The Indian government has been working on amending the IT rules for intermediaries like Facebook, Google and others to make them more responsive and accountable. It is also crafting data protection law to ensure privacy, safety and security of user data. These include provisions around the handling of data of adults and minors, storae within the Indian borders and penalties for non-compliance.

Work is also underway on a framework for non-personal data governance. A panel, chaired by Infosys co-founder Kris Gopalakrishnan, gave recommendations on the proposed rules for non-personal data framework to the government in July this year.

Another gainer in 2020 has been the mobile gaming segment. While the ban of PUBG had many disappointed, it provided a fillip to other games like ‘Garena Free Fire’ and ‘Call of Duty Mobile’. To cash in on the opportunity in the space, Bengaluru-based nCore Games had announced that it will launch FAU:G, a multi-player action game being developed under the mentorship of Bollywood actor Akshay Kumar.

Interestingly, PUBG is keen to make a comeback in the Indian market with PUBG Corporation — the parent company of the game — preparing to launch ‘PUBG MOBILE INDIA’. After the game was banned in September, PUBG Corporation had said China’s Tencent Games would no longer be authorised to distribute the PUBG MOBILE franchise in India and that it will take on all publishing responsibilities within India.

According to Maple Capital Advisors Managing Director Pankaj Karna, the gaming industry in India grew at a CAGR (Compound Annual Growth Rate) of around 21 per cent during the lockdown with annualised growth estimated to be in the region of 30-40 per cent.

“User base of some of the leading gaming companies have seen an increase of more than 100 per cent. The industry saw USD 355 million worth of private equity and venture capital investments from March-December 2020, with key deals being Dream 11 raising USD 225 million,” Financial Express

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