Wattpad Corp. has struck a deal with Indian media giant Bennett Coleman to expand the social media firm’s reach into the world’s second most populous country.
Toronto-based Wattpad, which is attempting to build a global entertainment business fuelled by user-generated content published on its online platform, said it will receive funding from the global investments and partnership division of India’s oldest and largest media conglomerate (better known as Times Group). Times will also help Wattpad turn popular stories published on the platform into books, TV shows, films and digital projects for the Indian market. The parties did not disclose terms.
India “is a market where breaking through the clutter and telling your own story is beyond essential,” said Rishi Jaitly, CEO of the Times Bridge investment division, which has backed other prominent foreign tech companies that have expanded into India including Uber and Airbnb. “Our intention is to bring to bear our resources to support Wattpad’s growth in the market.”
The social media firm has more than 70 million monthly users globally – predominantly teenage girls and young women who both post their fiction on the platform and avidly read it. They spend a collective 22 billion minutes a month on the platform writing 200 million comments and messages about the stories. That engagement has helped turn many works into commercial successes in other formats, including After, a fan-fiction romance story written by Anna Todd which sold 10 million copies after its publication in book form in 2014 and the inspiration for a movie hitting theatres in April. The Kissing Booth, a Wattpad story by Beth Reekles, was adapted into one of the most-watched films on Netflix last year.
Wattpad, which uses artificial intelligence to identify which stories connect most with readers, has taken an active role in helping its writers get book and film deals in North America, Asia and Europe, while earning agent or co-production fees. The company announced in January it would start publishing young adult fiction titles itself this fall on its own imprint.
That is the latest in a series of initiatives by Wattpad to generate revenue from its platform. The firm also recently started offering an advertising-free subscription service for readers, and has experimented with selling access to dozens of Wattpad stories online on a chapter-by-chapter basis, sharing revenues with the authors.
Wattpad has millions of customers across South East Asia including a “pretty sizable user base” of 2.6 million monthly users in India – double the level in 2016 – CEO Allen Lau said. The company also recently hired a country manager for India. “We have critical mass there. Is it at the peak of its potential? Not even close.”
He said the belated but rapidly expanding adoption by Indians of inexpensive smartphones in the past three years – fuelled by price wars between telecom companies offering cheap data plans – has opened up opportunities for the company. “Everyone has a mobile phone now and more importantly people can get unlimited data for $3 a month,” Mr. Lau said.
“That completely changed user behaviour in India. People didn’t go on the internet because no one has a landline and mobile data was expensive. Now it’s exactly the opposite. [As a result] the demand for content has never been greater. It’s almost a perfect storm in a good way and we can leverage Times to double down on this market.”
Mr. Jaitly said Wattpad’s success in other Asian markets and “palpable momentum” among local customers bodes well for its prospects in India. Asked whether he thought the partnership could spawn Bollywood films, he replied “it is absolutely our intention to help Wattpad stories travel and become more vivid and take on a life of their own.”