When Netflix launched in India over two years ago the service consisted of just 826 titles. Flash forward to 2018, with over 4000 titles, the streaming giant’s India library is one of its most extensive offerings in the world, behind Japan (6032), the US (5609), Canada (5460), the UK (5108), and Ireland (5023), according to new data from website Finder India, which analyzed the Netflix libraries of 73 countries to see how they compare in terms of quantity.
However, despite Netflix’s growing commitment to licensing and producing content geared for an Indian market, the streaming giant still trails far behind local OTT services like Hotstar, SonyLIV, and Viacom 18’s Voot. At the end of 2017, Netflix had approximately 5 million active users, while Hotstar — India’s leading streaming service — had over 70 million. And according to new data from mobile advertising and Internet service provider Jana, released by Variety, that gap is only getting bigger. The data found that in the first quarter of 2018, Hotstar was responsible for 70% of video streaming app downloads. SonyLIV doubled its share from 5.9% three months earlier to 13%, Viacom 18’s Voot came in third place with 11%, while Amazon Prime Video had a 5% share and Netflix just 1.4%.
Part of the company’s problem in the country is its unwillingness to drop its subscription-based model. The company insists on charging 500 Rupees (roughly $8.00) per month for access to its content. While this may make sense in places like the US and the UK, the logic of the strategy falls short in countries like India, where just a few years ago the annual median per capita income stood at $1670.
For the citizens of India, setting aside $96 a year is an unnecessary inconvenience when they can just tune into a local service for little to no cost. In fact, most of Netflix subscribers in India take advantage of the services free trial. According to the research from global industry analysis firm Counterpoint, only 6% of Netflix subscribers actually pay for the service and the rest take advantage of the ‘free first month’ trial through multiple credit and debit cards.
Even when looking at the leading OTT service Hotstar, which runs on a hybrid model and charges $1.48/mo for its premium services, only 2-3% of its subscribers pay for the service.
If Netflix wants to win over the average working citizen of India, it will need to seriously consider working off an ad-supported model or at most consider dropping the price of its monthly subscription fee by a significant percentage. It also wouldn’t hurt to produce content geared for mobile viewing, considering most of India accesses the internet through via cell phones.