Startup Street: No TikTok? No Problem. 
The logo for ByteDance Ltd.'s TikTok app. (Photographer: Brent Lewin/Bloomberg)

Startup Street: No TikTok? No Problem. 

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Short-form video applications by homegrown firms have stepped in to fill the gap left by TikTok when it was banned in India last year.

The Indian user base for short-form video content is now back to 97% of what it was prior to June 2020 when TikTok was banned, according a report by RedSeer Consulting. Besides, the time spent on these apps has also bounced back to 55% of pre-Tiktok levels indicating a maturing market, it said.

ByteDance’s viral TikTok app made waves in India, helped by dirt cheap data connectivity, and fuelled a content creation spree across the country. India became one of TikTok’s largest market with more than 20 crore users. However, the app was banned in June 2020 by the Indian government as part of a wider crackdown against China citing sovereignty and security concerns.

The gaping hole left by TikTok quickly started to get occupied by smaller rivals. These included InMobi-owned Glance’s Roposo, Bengaluru-based Mohalla Tech’s Moj, Times Group-owned MX Takatak and DailyHunt’s Josh.

“In less than one year post Tik Tok ban, Indian platforms have shown a strong V-shaped recovery,” said Ujjwal Chaudhry, an associate partner at RedSeer Consulting. “This shows how platforms were able to design the product, execute their plans and market it aggressively in a very short period of time.”

Startup Street: No TikTok? No Problem. 

These apps have been able to capture Indian audiences quickly by positioning themselves as “Bharat-centric”, Redseer said. That has helped them develop a loyal userbase that’s likely to persist even if the ban on TikTok is ever lifted.

RedSeer said about 55% of the users mention the availability of regional content as the key reason for using these apps. This was a dominant trigger for the number of users signing up from Tier-2 cities.

Overall, 60-62% of the short-form video app users in India are from Tier-2 cities—higher than the trend seen for other content-focussed social media apps like Instagram and YouTube.

Startup Street: No TikTok? No Problem. 

The fast-growing user base of these apps has also led to a large monetisation potential for influencers and platforms, RedSeer said.

The platforms are benefitting from a network effect where increasing user base leads to rise of influencers which in turn attract more users to these platforms.

Elite influencers with over 1 crore followers could earn anything between $20,000-40,000, a month. Influencers with narrower reach—up to 10 lakh followers—can still mint about $1,000-2,500 while budding creators can earn between $40-200, RedSeer said.

The vast earning potential at the top-end of the influencer bracket is leading to strong motivation among content creators and higher satisfaction, the report said. Besides, the pandemic has helped: “The excess of time due to staying at home, coupled with the short-form platforms adopting a model wherein the pay monthly to the content creators has led to more people taking up content creation on these platforms.”

While there are over 40 short-form video apps in India, Moj, Josh, MX TakaTak and Roposo are the market leaders. These apps, according to RedSeer, offer strong localisation and have better technology stacks.

Josh, which was started by news aggregator Dailyhunt, has shown strong adoption in the Hindi-speaking states and tier-2 cities. On the other hand, Roposo and MX TakaTak have seen a lot of their growth come from metropolitan regions. Moj has been a top performer for other regional content.

Startup Street: No TikTok? No Problem. 

That said, these apps now have to prepare for their next leg of growth, Chaudhry said.

“The job is far from done,” he said. “The players still have to reach the global and cross sector benchmarks on engagement and retention—which will further grow the monetisation potential for the entire ecosystem.”

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