GenZ And Its Content Consumption Patterns Are Shaking Up The Distribution Market | Open Interest

'Cut the cord' seems to be a mantra in most urban households these days. The age-old cable TV is winding down as more and more households, prompted by decision-making GenZs, are going the smart TV way. This, in turn, means that India’s traditional content distribution channels—cinemas and cable TV—are undergoing a major disruption. In other words, the shift is transforming conventional cable TV businesses into last-mile broadband providers.

To put things in perspective, between December 2020 and December 2024, India’s internet subscriber base grew by over 176 million, reaching 970.1 million. During the same period, the average monthly Average Revenue Per User for wireless services rose from Rs 101.65 to Rs 181.80—an increase of nearly 80%.

This rise in ARPU has coincided with a significant wave of reduction in cable TV subscriptions. The cable TV customer base declined from 13 crore to 11.1 crore, while Pay DTH subscribers dropped from 7.1 crore to 5.82 crore. In total, Pay TV (Cable + DTH) lost 3.3 crore subscribers over four years, shifting revenue from traditional cable distribution industry to telecom operators, as more consumers embraced data-driven OTT content and connected TVs.

A recent EY report on the state of cable TV distribution in India projects that Pay TV subscribers could fall to around 7 crore by 2030—a conservative estimate given the rapid adoption of internet-enabled and connected TVs.

According to the report, 93% of TVs sold in India in 2024 were internet-capable. The rise of work-from-home and study-from-home models has further accelerated broadband adoption, led by telcos like Jio and Bharti Airtel. Jio is targeting 10 crore broadband homes, while Airtel is aggressively expanding its broadband footprint. Even private cable operators are now entering the broadband space, contributing to a broadband subscriber base of 94.49 crore by December 2024.

The availability of affordable data has enabled mobile and digital content consumption, reducing reliance on traditional linear TV. Internet-enabled TVs now come with built-in OTT platforms, making them more appealing than cable TV. This has also seen content makers and aggregators aligning to the new breed of GenZ consumers who have moved away from Cable Pay TV platform.

Globally, Pay TV subscriber numbers are declining, but the pace is particularly steep in India. This is because many developed countries have already transitioned to OTT and connected TV platforms, where cable TV is often more expensive than broadband and OTT bundles.

As affordable broadband becomes more widespread, the cord-cutting trend is expected to accelerate. Households are moving toward a “triple play” model—mobile, connected TV, and broadband internet—capturing a limited share of the entertainment wallet.

While content creation is now platform-agnostic, monetising it remains a challenge in a fragmented market. Cable Pay TV content is increasingly being replaced by OTT bundles offered by telecom operators, who use the same routers to deliver internet and OTT content via set-top boxes.

The shift in GenZ consumer viewing habits, the rise of on-demand content, and the growing popularity of internet-enabled and connected TVs have disrupted the traditional cable TV business. To survive, cable operators must offer bundled services like broadband connectivity to offset declining monthly revenues. Broadband services are providing better margins compared to traditional cable business.

This trend has prompted nearly half of local cable operators to launch broadband services. A survey of these LCOs revealed that 43% have started offering broadband to supplement their revenue, as rising content costs from broadcasters are becoming harder to pass on to customers.

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