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Netflix To Spend $5 Billion On Content This Year, But None Of It On India, Yet

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So after all those rumours, the allure of the rapidly growing Indian internet market proved too much for Netflix to resist. Hence happened the Indian debut of world’s largest streaming company. And Jonathan Friedland, the Chief Communications Officer of the company recently talked to Economic Times on Netflix’s India plans for the near future.

In an interview with Amit Bapna of Economic Times, Friedland covered a variety of topics, ranging from the type of content his company works with to a in-depth look at the reasons behind its Indian entry.

Speaking about his company’s recent debut and about the type of content Netflix currently has on its hand, he said,

Whenever we enter a new market, over a period, we do a combination of original and local content. When I say local it does not matter whether Hollywood or English or Indian – it’s about having rights to it.

He went on to add that the company isn’t really in a rush about the creation of original content — which is one of Netflix’s high points — and will instead move into the area after a detailed study of the local content.

In the US we have been operating for 20 years before we did our first piece of original content, and we were in Mexico for 4 years before we did the first original content.

Well, I cant help but wonder if in this case, the ‘study’ of local content will involve Netflix executives spending at least some of their time watching Indian daily soaps. I can just see their faces, ha ha ha.

On the topic of choosing content, he outlined his company’s strategy of first looking at creators across markets who have a good record of storytelling, a step which is then followed by the determination of how much money the company is willing to spend. This is where the data associated with projected audience kicks is and is used to work out the actual spending for a project.

While accepting that yes, India was a challenge and that Netflix does not have much Indian content as of now, Friedland said that Netflix wasn’t really aiming to have the largest catalogue anyways.

[We] will never ever have the deepest catalogue. We can’t and we won’t. That is not the way we think. We think about providing great stories from all over the world for people all over the world. We are not trying to be Eros or trying to do what Hungama or other leading Indian creators of entertainment do.

The company will instead begin with popularizing its services among a particular set of consumers — English-speaking, able to appreciate Western entertainment, in possession of an international credit card, with an iTunes account and so on — and once it gains a foothold, will deepen its content in India to offer a wider service to a broader Indian population. Only then will the company move towards the creation of local content in India, content which it says will then be “for the world”.

He further emphasized Netflix’s commitment to staying ad-free and said that instead of YouTube or Spotify’s ad-based business model. Netflix is subscription-only, which is why it has to work hard — including the creation of original content — to grow its user base.

We have to grow subscriptions in order to be able to afford more content and in order to grow our margins, so we can earn back the investments that we are making in expansion globally and the investment on the content. We are spending $5 billion on content this year.

Finally, on the question of pricing, the Netflix CCO accepted that for now, his company was targeting the the wealthier sections of the country.However, he did say that as his company moves in deeper into business, it will probably reconsider the situation.

As we go deeper in the market, we will be looking at the equation. We believe that people are willing to pay a reasonable amount of money for content if they get it quickly and at a reasonable price.

As of now, Netflix’s subscription plans for India start from around INR 500.


A bibliophile and a business enthusiast.

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