Should Hotstar prioritize exclusive premium content or expand its free tier to increase user base?

Introduction

The trade-off between prioritizing exclusive premium content or expanding the free tier to increase Hotstar's user base is a critical decision that could significantly impact the platform's growth trajectory and revenue model. This scenario touches on key aspects of content strategy, user acquisition, and monetization in the streaming industry. I'll analyze this trade-off by examining the product ecosystem, potential impacts, and experimental approaches to inform a data-driven recommendation.

Step 1

Clarifying Questions (3 minutes)

• Based on Hotstar's current market position, I'm thinking user growth might be a key priority. Could you share our current market share and growth targets for the next 12-18 months?

Why it matters: Helps determine the urgency of user acquisition vs. monetization Expected answer: Moderate market share with aggressive growth targets Impact on approach: Would lean towards expanding free tier if growth is the primary goal

• Considering our content strategy, I assume we have data on engagement rates for exclusive vs. non-exclusive content. Can you provide insights on how exclusive content performs in terms of user retention and watch time?

Why it matters: Informs the value of investing in exclusive content Expected answer: Exclusive content drives higher engagement and retention Impact on approach: Would strengthen the case for prioritizing premium content if true

• Looking at our technical infrastructure, I'm curious about our current capacity to handle a significant increase in free users. What's our scalability outlook for the next 6-12 months?

Why it matters: Determines feasibility of rapidly expanding the free tier Expected answer: Scalable infrastructure with some planned upgrades Impact on approach: Would influence timeline and resource allocation for free tier expansion

• Regarding our content budget, I'm wondering about the flexibility we have to invest in new exclusive content. What percentage of our budget is currently allocated to exclusive content acquisition or production?

Why it matters: Assesses our ability to compete on exclusive content Expected answer: Moderate allocation with room for increase Impact on approach: Would impact the viability of doubling down on exclusive content strategy

• Considering user behavior, I'm interested in our conversion rates from free to paid tiers. Do we have data on the typical user journey and conversion timeline?

Why it matters: Helps evaluate the long-term value of free users Expected answer: Moderate conversion rate with potential for improvement Impact on approach: Would influence the balance between free and premium strategies