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Reports Indicate Netflix Struggles to Expand Business in India Due to Insufficient Local Content

We know the streaming giant Netflix has a huge subscription base around the world. And India is certainly not an exception. However, Netflix, with around 65 lakh subscribers in India, has reportedly failed to scale up its business in the key Indian market. Analysts at global asset management firm Alliance Bernstein cited the lack of local content as the primary reason for Netflix’s slower growth in India. According to them, only 12 percent of the titles Netflix offers in India are local content.

In comparison, nearly 60% of Amazon Prime Video’s offerings in India are in domestic languages. Prime Video has about 2 crore subscribers in India, while Disney+ Hotstar continues to dominate the market with over 40 million subscribers.

The analysts write that the lesson from India is that streaming services need to offer more local-language content, but also that value is less important than cost in many emerging markets. They add that India is likely YouTube’s largest market, and a key growth area for social media companies. Netflix has not yet commented on the report.

Netflix’s significant price reduction in India helped the company grow engagement in the country by nearly 30% year-over-year in the first quarter of 2023. To meet local needs and deepen its penetration, Netflix reduced its prices in India by 20-60%.

Netflix’s price reduction and improved slate of content helped increase usage in India by nearly 30% year-over-year, while FX-neutral revenue growth in 2022 accelerated to 24% (up from 19% in 2021), according to the company’s quarterly earnings report.

Netflix is reportedly planning to raise its subscription prices in the US and Canada first, in order to offset the revenue lost during the Hollywood strike. After seeing success in India, Netflix reduced prices in 116 more countries in Q1. This helped the streaming giant add 5.9 million subscribers globally in Q2, with the US and Canada accounting for 1.17 million new members. Stay tuned to know more about it and others only with us.

 

Ziya Khan

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