Less Than 5% Internet Users In India Have Netflix Subscription

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The third-quarter earnings report of Netflix is out; The streaming giant beats the Wall Street expectations in terms of revenue but fell short of the subscriber base and profit margin target.

The massive growth of Netflix has apparently started slowing down. In Q3 2020, the company posted 23% growth in revenue but added only 2.2 million new paid subscribers, much less than 3.2 million subscribers Wall Street analysts were expecting. In fact, the company failed to meet its own forecast of 2.5 million paid subscribers set for the third quarter ended September 30, 2020.

One of the prime reasons behind Netflix’s below-par performance in Q3 2020 was the lukewarm response received from emerging markets, especially India.


India, the world’s second-largest market by the number of smartphone users as well as internet users, is yet to respond as expected by Netflix. With an estimated 687 million internet users by the end of 2020, India is the second-largest country, following China. On the other hand, the number of Smartphone users in India is expected to reach nearly 600 million by the end of this year.

Such numbers are encouraging enough for any OTT player to penetrate the market as aggressive as they could, especially when the competition from global and homegrown players are on the rise.

Netflix, the leader in OTT space, ventured into India market nearly five years ago. In January 2016 when Netflix debuted India as a part of their global expansion plan, analysts and experts were quite optimistic about the aggressive growth and market response expected from the India market.

In the latest five years, however, Netflix could rope in less than 5% of total internet users in India. According to GraphFarm, a platform for data and graphs, Netflix India is estimated to clock whopping 111.7% YoY growth in 2020, as the total number of Netflix subscribers in India reaching 26.6 million by the end of this year.

Source: Dazeinfo GraphFarm, Atlasvpn

While the year over year growth of Netflix user base in India is quite astounding, the total number is still not painting quite an impressive picture. Despite users’ increasing interest in OTT platforms during nationwide lockdown and pandemic, Netflix could attract 14 million new customers during this whole year.


Just to put the thing in context, nearly 25% of internet users in the US have Netflix subscription.

The challenge for Netflix in India is quite visible. The country which is known for its price sensitivity and conservative buying preferences is proving to be a hard nut to crack for Netflix.

One of the key reasons behind the low adoption of Netflix in India is its pricing strategy that is hurting the OTT giant the most. The exorbitant pricing strategy has pushed paid users to share their account with multiple users to bring the actual cost down. As users in India are least concerned about their data privacy they don’t hesitate from revealing username and password of their Netflix account in a bid to bring the monthly cost down to as low as Rs 200.

Unlike the US and Europe where people have multiple TV connections in their homes, India is still a country of families having a mindset of one-home one-TV. In such a scenario offering a big-screen subscription package starting from Rs 649 a month is the major discouraging element for users in India.

Netflix has realised the challenge and soon after announcing the Q3 results, the company has disclosed new strategies to lure more subscribers in emerging markets like India. With free Netflix for India and low price subscription for mobile-only users, the OTT leader is expecting to strengthen its growth in India. In the current scenario and current strategies deployed by Netflix, it’s estimated that India will emerge as the biggest market outside the US with 41.2 million subscribers by 2023.

How the India market will respond to the Netflix in future is anybody’s guess currently but considering that the US market is showing sign of stagnation, Netflix has set its eyes on India market. It would be interesting to see if Netflix decides to revisit its pricing strategy in India – something similar to what Amazon has done with its Prime Video subscription.

What’s your take on the growth and future of Netflix in India? Do let us know your views in the comment section below.


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