Netflix’s entry into India and other 129 countries has made headlines in the digital and broadcasting space and nascent OTT markets. It recorded average daily visits of 209,000 on desktops between Jan. 06 and Jan. 19, according to SimilarWeb, a market intelligence company tracking online traffic. It also recorded an average of 1.7 million daily page views in the same period. Netflix has surpassed 75 million users and expects six million more by first quarter. But most importantly, it raises important questions whether the Indian consumer, who is accustomed to free content, is ready for Netflix’s subscription-based model.
Where it lacks
Netflix disappointed its users in India with its limited library (7 per cent of its US library). Subscribers to Netflix in India cannot stream those original shows of the company, for which broadcasters in India have already signed deals for the broadcasting rights, including House of Cards. This goes for other popular shows as well. As a result Netflix till now has about 18.8 per cent of titles (from IMDb’s top English series and top Hollywood films).
Netflix is taking it slow with their focus on offering a global catalogue with robust mix of titles. “The goal is to offer a fully global service with a global catalogue so no one has to wait for the hottest new show or movie. However, the world of content licensing has traditionally been very fragmented and regionalized. It will take some time, several years at least, to get to an offering that’s the same everywhere. Until then, we strive to offer a compelling service everywhere by licensing the best of TV and film available,” commented a Netflix spokesperson while sharing their content strategy.
Focus on local content
As talked about in our previous article the biggest challenge for Netflix is to educate and inform viewers about its content in order to create a firm footing in the market. “The whole objective is to create a habit of consuming content online and build loyalty long term,” says Kaushal Dhoker, Brand Manager (Digital Marketing) at &TV. He feels it needs “to tie up with local content makers and produce content like Scoopwhoop’s Baked and TVF’s Permanent Roommates and give it out to consumers. In this manner the production value will go up. They need to make appealing relevant content for its TG. Same people who are watching Game of Thrones watch AIB. They need more Indian content.”
There are high expectations from Netflix going by their popular original shows like ‘Narcos’ and ‘Orange is the New Black’. So any plan of collaborating with Indian filmmakers, we enquire. “We look for talented storytellers with a strong track record who have stories they are passionate about telling. We are able to make informed decisions by using our data to size the potential audience for a project and estimate the right amount to spend,” says the Netflix spokesperson.
Currently Netflix had about 3 per cent of the top 100 Bollywood movies (of IMDb list), compared to Spuul and Hooq which has stocked up 25.3 per cent and 21.2 per cent respectively of content present from the same title list.
Netflix is aware of this fact and mentions that it remains true for some countries during the launch. “We will add more as the service grows in popularity and we better understand what our members want to watch in each region. We offer programs for tastes of over 70 million members around the world so there is something for everyone,” Netflix spokesperson added.
Working around India’s internet problem
Talks were already being initiated about India’s internet problem when Netflix announced its launch in India. It’s a major roadblock since India has the slowest broadband speed in Asia. Moreover, an hour of content in HD consumes around 3GB of data (and 7GB for ultra HD). But Netflix claims to have worked a way around it. “Netflix automatically adapts the data rate of the video stream to meet the bandwidth available to the member at any point in time. Our adaptive streaming engine allows us to automatically adjust the bit rate of the video stream based on a member’s bandwidth so we can eliminate buffering. We do this by encoding video content for a multitude of devices and formats so we can deliver the one that will provide the best viewing experience.”
Breaking it even
Netflix is applying a simple formula to make it profitable. “We’re focused on making our service better -- better personalization, better streaming, better movies and TV shows. It’s up to us to win the moments when people decide what to do with their time. While competition will grow, we intend to continue being the industry leader. Also we have to deliver a product and content that makes you want to watch Netflix rather than another form of relaxation and entertainment,” offers the spokesperson.