December 3, 2022


Why is Netflix facing difficulties to grow in India?

3 min read

So far, Netflix India has retained its position as a flagship service, raising the price to outrageous levels. Netflix’s most basic package, priced at INR 149 per month, allows for only one user account on a single device, either a mobile or a tablet. It also offers 4K streaming across four concurrent streams with the INR 649 a month premium plan.

Without context, these figures appear to be adequate, if not reasonable. After all, as compared to its foreign price [$10-20 (INR 750 – INR 1500) in the US and £6 – £14 (INR 600 – INR 1400) in the UK], Netflix India business plan offers the lowest service in India. However, when key macroeconomic criteria are considered, we can see why Netflix does not appeal to the average Indian as a feasible option, although India is one of the world’s greatest content markets.

How is Netflix growing in India?

According to a CSE study conducted by Azim Premji University, an additional 230 million Indians plunged into poverty in the early aftermath of the COVID-19 pandemic. Another sobering reality is that the wealth imbalance in India is enormous: the richest 100 Indians own as much as the bottom 550 million.

This, however, is not India that Netflix wishes to attract. Netflix is just not an option in India, where the average monthly pay is INR 32,800. As things stand, even though Netflix may feel cheated, it must rethink its pricing approach to compete with cable, which costs an average of INR 300 – INR 350 per month in India, compared to $64.41 in the United States (INR 4,830).

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While the evidence presented above makes it very evident that India is a price-sensitive country where people seek value for money, it is not primarily looking for ‘free.’ In 2021, India has progressed beyond being a price-sensitive market, with more consumers opting for paid content. This was emphasized by a 55-60 per cent year-on-year increase in SVoD (subscription-based video on demand) in 2020, with more than half of new consumers projected to continue using the service.

  • Recently, Netflix lowered its subscription fees throughout all plans on December 13, 2021, bringing its cheapest plan to INR 149 per month – even though it is insufficient. 
  • While Netflix is focusing on newer content, programming partnerships, and localisation, the market pain points are evident – particularly indigenisation; it also lacks the additional benefits that come with two of its biggest rivals. 
  • With a foundation as strong as Netflix’s in nations such as the United States and the United Kingdom, one would think that the streaming platform would be a sure bet in India; so what went wrong with the company’s strategy?

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In India, Netflix’s competitors include bundled services and ad-supported OTT platforms.

Surprisingly, given that Netflix is far and by the most expensive platform in the Indian OTT market, it does not provide any additional services. Its competitors, on the other hand, are not making the same error.

Subscriptions to Amazon Prime include not only video-on-demand programming, but also free delivery and special discounts on Amazon, Amazon Prime Music, and Kindle Unlimited. Amazon Prime also consistently licences the most popular Bollywood films, such as Salman Khan’s Bharat and Alia Bhatt’s Raazi, and distributes content in numerous Indian languages, making it a considerably more appealing option for individuals looking for content in Indian languages.

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On its cluttered main page, Prime subscribers can also access eight other smaller streaming services – shows, films, reality TV, and documentaries – with a single payment option.

Piracy Is a Problem in the Content Conundrum

After understanding the crux of the topic we also came up with why Netflix is struggling in India?, Netflix, which has spent around $3 billion on original and licenced local material, has followed the same strategy it has used in the United States and other countries — it has collaborated with Indian studios to create local content but has spent money pushing ‘foreign’ original content on Indians.

One of the most vexing aspects of Netflix is its lack of localisation in the Indian market. Sure, it has bundled arrangements with many Indian production houses and has produced India-original content, but it is simply insufficient. Netflix continues to prioritise fresher content, which is a positive thing, but it lacks indigenisation.

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