Netflix has grown astoundingly in Indian VOD market but still has got a long way to cover before it outpaces Amazon Prime. In an effort to do so, Netflix is tieing up with Indian telcos to double down on its business growth. Telecom giant Bharti Airtel is reportedly in advance talks with the OTT video streaming platform to offer free access to its contents on Airtel TV app for free.
“Netflix and Airtel are in advanced discussions for an exclusive tie-up to offer Netflix content to Airtel mobile customers. Several rounds of discussions have been completed between the two companies and the deal could be announced in the coming weeks,” sources privy to the deal told PTI.
Importantly, the Netflix subscription fee won’t be charged from the users but they have to pay for the internet data which they use to access the content.
Airtel spokesperson declined to comment when contacted. No immediate reply was received on an email query sent to Netflix.
Netflix has been desperate to edge past other OTT video platforms in India like Hotstar, and its arch-rival Amazon Prime. It was able to turn in 5 million subscribers in just one and a half year since it launched its services in India in 2016. Netflix took 4 years to reach that number when it launched in its home territory the U.S, though it was all DVD by-mail customers in early 2000s. The company expanded into film and television production plus online distribution from 2013. Now the company hosts over 125 million hours of video content including, TV series, movies, Netflix Original shows, documentary and feature films to be accessed by its members.
Though Netflix India’s trajectory has been noteworthy, its target audience is more confined to the elites from metros and the urban Indians, that is why it only reaches a small fragment (around 1.5%) of countries 1.35 billion population and 248 million households. In contrast, U.S has around 56.71 million active Netflix users, as of Q1 2018. Interestingly, streaming revenue of Netflix in India continues to rise significantly. The streaming revenue is expected to rise from $25.87 million in 2017 to $87.26 million in 2018 in India.
Netflix has a tough battle ahead to win subscribers in India as there are about 29 OTT video streaming services in competition including Hotstar, Amazon Prime, Voot, etc. Last year Netflix built strategic partnerships with Airtel, Vodafone, and Videocon d2h to expand distribution and reach out to more Indians via set-top boxes and prepaid mobile offers.
Airtel, on the other hand, seems to be playing from both sides. Earlier this year, Airtel was offering free Amazon Prime membership to its postpaid customers. Obviously, it was a steal deal as the customers would enjoy free services beyond video streaming for 1 year. Airtel and Netflix have already partnered before, wherein Netflix app is available on Airtel’s internet and d2h service platforms. And Now, the telecom giant is offering free Netflix subscription on its TV app.
Airtel, despite lagging behind from Reliance Jio in 4G connectivity, continues to dominate the telecom industry with close to 26% market share. Reliance Jio is fairly responsible for undercutting its revenue. It’s not very unfortunate that Airtel is capitalizing on closest rivals simultaneously. Airtel has launched Internet TV, which is the new DTH-set top box that comes preloaded with Netflix and Youtube, with an annual subscription of INR 8,000.
Netflix subscribers in India are bound to increase as it has already started co-working with local players, just like Amazon Prime. The market appears ripe for Netflix as Reed Hastings was noted saying, in Feb 2018, that the next 100 million subscribers for the company will come from India.
Furthermore, Netflix has launched 30-second preview videos on mobile today. Previously it offered previews via its TV app and on the web.