Is Original Content The Reason Of Growth Behind This US-based OTT Giant
Netflix India reportedly clocked in a revenue of INR 466.7 crore for FY19 with a net profit of INR 5.1 crore.
The rise of over the top (OTT) media services in India is not surprising given the increasing internet and smartphone availability. Rather than being constrained to the weekly timing of television shows, users can now watch a huge variety of shows anytime, anywhere on their mobile phones. According to a report by RedSeer, the Indian OTT market is projected to grow 80 per cent from 170 million in 2019 to 300 million by 2022.
The switch to OTT is also reducing the need for direct-to-home (DTH) services. According to a report by the Telecom Regulatory Authority of India (TRAI), the direct-to-home (DTH) services had an average active subscriber base of 54.26 million at the end of the April-June quarter. This was a 25 per cent drop from 72.44 million subscribers recorded in the January-March quarter.
One of the dominant players in this market is US-based streaming giant Netflix, which came in and attracted a huge section of the Indian users with not only making foreign content easily available but also reached out to the masses with its local original content.
Netflix India's Growth In Numbers
According to media reports which cited data from business intelligence company Veratech Intelligence stated that Netflix India clocked in a revenue of INR 466.7 crore for FY19 with a net profit of INR 5.1 crore.
Citing Veratech founder Mohit Yadav, EconomicTimes reported that several factors including original content for India, partnership with Airtel for better market access to market and fixing payment issues are responsible for driving the growth of the company in India. According to him, Netflix's low-cost subscription plans for the Indian market has also bolstered the growth of the company.
Entrepreneur India has reached out to Netflix for comments. We will update the story as soon as we hear back from them.
The US-based company had entered the Indian market in 2016 as a part of its global rollout. With the OTT segment gearing up in India, Netflix had been focusing on producing local and original content to attract more consumers.
In May, reports revealed Netflix had plans to launch 22 original movies and 11 series in India by 2020 as a part of the company's aim to create appealing content from the country. The US company had made its debut in producing local original content in India with crime thriller "Sacred Games', based on a novel by Vikram Chandra.
However, Netflix faces major competition from other OTT players especially on the fronts of subscription cost and local language content. To attract more users, Netflix launched the India-specific mobile-only subscription plan in July at INR 199 per month. According to media reports, Netflix claimed that this plan has helped them get good results. Apart from this, the streaming giant offers other plans such as basic at INR 499, standard at INR 649 and premium at INR 799.
Netflix faces stiff competition from other domestic and international OTT players such as Hotstar, Amazon Prime, Voot. Star India-owned video streaming platform Hotstar is also looking to capture the Indian market with its original content. According to reports, the company will make original movies under its Hotstar Special label. It also earmarked INR 120 crore for producing original content.
Last year, media reports revealed that YouTube is also looking to strengthen its presence in the India market with "YouTube Originals". With the foray into the original content making segment, YouTube also forms a major rival for the OTT players.
Apart from streaming companies, e-commerce players such as Flipkart and Zomato are also betting on the growing OTT segment. Flipkart forayed into the OTT market with "Flipkart Videos' in August. The service has been integrated into the app. Bollywood content and shows from content providers such as Viu, Dice Media, TVF and Arre are available under this service. Recent reports stated that the company launched its original content platform called "Flipkart Video Originals', which will be integrated within the Flipkart Video service.
Meanwhile, food tech giant Zomato announced its plans to launch Zomato Originals in September. According to media reports, 18 original shows will be released under the originals in three months.