E-commerce service Paytm is reported to be finalising plans to launch a video service to take on rivals Amazon and Flipkart.

According to sources cited by the Economic Times, the company, which is backed by Alibaba and Softbank, is now set to begin collating a content “war chest” to take on its e-commerce rivals. Paytm is reported to have already begun hiring for the new service.

“Paytm has been looking at this space (video service) for some time but it is only now that the plans to set up a team is being formulating,” one highly placed source told the publication.

“The idea is to have multiple services, from wallet to shopping to video, to attract more customers and boost engagement.”

Paytm, which currently has a link-up with Yupp TV allowing Paytm to provide several live TV channels, declined to comment on the report.

But, the ET reported, Paytm executives appreciate they need far more content to take on a rival with the content clout of Amazon, which offers video and music streaming via Prime Video and Amazon Music to subscribers of its Prime service, who are charged Rs 999 ($14) a year.

Flipkart is also planning to generate original content and is believed to be close to opening partnership talks with existing over-the-top content providers to launch a paid-for service much like Amazon Prime.

Vikram Malhotra, CEO at Abundantia Entertainment, told the ET he believes content is becoming an essential ingredient for platforms such as e-tailers.

“The key challenge will be to build a compelling product that offers streaming video and music while retaining the customer on the platform so that share of mind and wallet is captured comprehensively,” Malhotra said.

There is also a widespread view that content is essential to grow loyalty to a platform – content as marketing.

“Entertainment and news apps are visited up to eight times a day, and comprise around 30% of total time spent by a user on his phone,” said Ashish Pherwani, partner, media & entertainment, EY India.

“This aspect can be used to increase time spent on apps that provide content and enhance customer acquisition efficiencies,” he added.

Sourced from Economic Times; additional content by WARC staff