Netflix’s Struggle In India Continues: User Growth Tanks In 2019

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Almost every OTT player, including Netflix, Hotstar and Amazon Prime Video, has placed its bet on India to capture a sizeable share of the market. With the second-highest number of internet users in the world, the popularity of online video streaming in India has been increasing steadily and is expected to witness a boom by 2023.

According to a report by eMarketer, the number of Indian digital video viewers in 2019 will increase by 18.6% as compared to the previous year. Digital video viewership is expected to reach 290.8 million by the end of the year and shows the potential to hit 330 million by 2020.

However, Netflix, the most popular OTT streaming service in the world, claims a very small portion of this number, as highlighted by the labored growth of Netflix in India ever since its launch in 2016.

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Netflix had no more than 0.3 million users when it first came to the Indian market three years ago. But, by 2018, its Indian customer base inflated substantially to 6.1 million, as compared to 1.3 million in 2017. This marked a monumental growth of 374.4%.

This rate of growth, however, hasn’t been maintained in 2019. The total number of Netflix users in India in 2019 is estimated to reach 8.1 million only. This signifies an increase of 32.5%, a considerable plummet from 2018. The number of users is estimated to grow to 10.2 million by 2020, making up for another drop in the percentage of Netflix’s growth in the Indian subcontinent.

Netflix users in India

India: a Highly Competitive Market for Netflix

In spite of exploded adoption of high-speed broadband connectivity, the growth of Netflix in India has been disappointing in the last two years. There are several factors that contribute to Netflix’s continuous struggle in India.

First and foremost, Netflix’s pricing is much higher than rival services. Hotstar, the most widely used OTT subscription in India, offers its cheapest plan at Rs. 365/ year, without device limitations. However, Netflix’s cheapest plan specially made for mobile/tablet users costs a customer almost Rs. 2500/ year (Rs. 199/month). In addition, the annual plans of Hotstar premium and Amazon Prime Video, which give unrestricted access to its entire repertoire on any device, cost Rs. 999. In contrast, Netflix’s costliest plan is billed at Rs. 799/ month, which means a user pays almost 10k a year for the service.

Another drawback keeping Netflix from gaining traction is its lack of regional content. India is a country of diverse cultures and a thriving domestic entertainment industry with big regional audiences. Netflix’s catalogue is severely limited in this aspect, as it is mainly oriented towards a Western audience and contains only a handful of good quality regional shows/movies.

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Rival subscription services have a big edge over Netflix in this aspect, as they feature a larger number of regional options to choose from. Hotstar provides early access and live streaming for Indian content such as cricket matches and daily soaps. Amazon Prime has an ever-increasing availability of Hindi, Telugu, and other regional entertainment.

Owing to these factors, only 3.1% of the total digital viewers in India use Netflix as a medium. Given the company’s agenda to gain 100 million subscribers in the country and dominate the Indian digital streaming market, it is evident that Netflix has a long way to go. Therefore, in addition to the cheap mobile/tablet plan, Netflix is also investing more in regional production specific to India.

Exclusive Nonetheless

Even though Netflix’s growth has proven to be sluggish in India, it still stands as one of the biggest global competitors in the international OTT market.

It is worthwhile to note that a significant benefit Netflix has over other competitors is its library of globally exclusive content. Netflix is known for manufacturing and providing access to cult classics, with a catalogue that’s updated frequently giving special attention to global trends.

Thus, Netflix remains one of the biggest international OTT services and was dubbed the world’s largest digital entertainment company in January 2018. It generated a global revenue of $2.4 billion in Q1 of 2019, making up for 53% of international streaming revenue worldwide.

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