This week saw another bet on an OTT service specializing in Asian content.
YuppTV, a global platform for South Asian video, landed $50 million from a new growth partner, KKR-backed Emerald Media, to help scale customers and revenue.
It’s a major boost for YuppTV, a freemium service with ~100,000 paying subs worldwide, following US$15 million in Series A funding last year.
Emerald has taken an unspecified but sizable minority stake.
The deal also sets a benchmark for OTT plays offering Indian content, as the center of gravity shifts from a lucrative customer base in the diaspora to emerging mass audiences in the domestic market.
The first priority for YuppTV, which has a foot in both camps, will be securing and extending its appeal among higher-Arpu international audiences, its core constituency at present. The new capital will be used to ramp up investment in content and marketing.
The ten-year-old service, which operates as a virtual MSO with linear and on-demand services across 14 languages, has established a decent beachhead in countries such as the US, where its monthly Arpus can nudge US$20.
It recently fortified its position by buying Telugu specialist Reliable IPTV, which operates in North America and the UK.
Executives see plenty of potential for YuppTV to go deeper into current markets as well as enter new ones, Malaysia and the Middle East in particular, in search of more direct paid relationships.
“Our strategy is first to consolidate and continue our leadership in the international diaspora markets,” YuppTV’s founder and CEO, Uday Reddy, tells Media Business Asia. “That is very clear for us.”
At the same time, the company is also looking to strengthen its bridgehead into India, primarily through OTT linear and TV Everywhere services
“From the India market perspective, we are very focused on Indian TV and catch-up,” Reddy adds. “There are only two players we are competing with here: Reliance Jio and Ditto.”
With multiple languages on its platform, YuppTV also plans to steer clear of the Hindi battleground, at least for now, targeting other languages first.
Earlier this year, the company tied up with ACT, India’s fourth-largest fixed broadband provider, to offer a paid streaming service to ACT subs in Telugu-speaking Hyderabad.
YuppTV, which also has a distribution deal for smartphones and TVs in India made by LeEco, is also looking for more telco and hardware partnerships in India to complement its direct-to-consumer drive.
It's a staggered growth plan across all markets, determined by near-term revenue opportunities.
“It will be a step-by-step process, and not just throwing all the cash at getting subscribers to sample you and not pay you,” says Emerald Media MD Rajesh Kamat.
Emerald, set up last year by KKR and The Chernin Group, has a mandate to invest between US$15-75 million in both early-stage and growth-stage opportunities, usually with a five-year investment horizon. The fund has up to US$300 million at its disposal.
Kamat and co-MD Paul Aiello continue to manage the company portfolio from The Chernin Group’s investment arm CA Media. These include Indian content assets such as Endemol Shine India that can potentially collaborate with YuppTV.
Traction in India could also open up more ad revenue for YuppTV, although subscriptions will remain the business mainstay for the foreseeable future, in India as well as worldwide.
The company has been diversifying its content mix, branching out into live streaming T20 and Asia Cup cricket for North American audiences this year.
At the end of 2015, it unveiled YuppTV Bazaar, an ad-based platform for user-generated content (with YuppTV taking a 30% revenue share).
YuppTV has also started commissioning its own content, which Reddy anticipates will gradually make up 20-30% of the catalog over the next three to five years.