OTT Platforms to Withdraw from Live News: But Why?

Many Over the Top (OTT) platforms had entered the space of live News due to the increasing viewership of live news content. Disney+Hotstar, ZEE5, SonyLIV, JioTV, MX Player, Voot and YuppTV had bought live news channels to cash this change in viewership.

But right now many OTT platforms are planning to withdraw from the field of Live news by discontinuing their News channels. The main reason for the OTT platforms to withdraw from this field is the FDI cap. The maximum limit of foreign investment in the telecom department also called the FDI cap is 26% in digital news. This makes the OTT platforms with foreign investments the first to withdraw from providing live news services. The FDI cap in digital media reduces the profit of these companies.

The introduction of intermediary guidelines has also complicated the scene. The intermediaries in the field of live news are YouTube, Facebook and Twitter which enhances the utilisation of TV news and Print news by users. The intermediary guidelines lack clarity which adds to the possibility of the OTT platforms withdrawing from this field. the OTT platforms are not willing to take the risk when many questions like, whether they have the power to take down defamatory content broadcasted by a TV channel, remain unanswered by the MIB. 

According to Abhishek Malhotra, TMT Law Practice Managing Partner, the OTT platforms work as intermediaries and need not worry about the FDI policy. The FDI policy is applicable for news aggregators like Daily Hunt. They collect news from different news channels and provide the users with a shorter version which makes it unnecessary to visit the main news item. The OTT platforms do not work as news aggregators and hence would not be affected by the FDI policy.

OTT platform which follows the Uplinking and Downlinking guidelines under the CTA act need not worry about the FDI policy as they use the same content that is already in the digital space in their digital platforms.

Uday Sodhi, Kurate Digital Consulting Senior Partner mentions that the FDI restrictions and the intermediary guidelines have confused the OTT platforms. The OTT platforms tend to depend on the news channels lesser each day and since their investment is in live news and not curated news these regulations need not apply to them. 

However, SonyLIV has already removed live news from its programmes. Most of the OTT platforms have already made the same decision due to high-risk factor and low revenue. Since the OTT platforms had invested heavily in the live news, withdrawing from it would be a great loss to them.