Netflix, one of the largest internet subscription services for television and movies worldwide, recently made a breakthrough announcement in India to reach out to mass market. As the war among OTT (Over-The-Top) content provider heats up, Netflix India decided to take an alternative route in the country by reaching out to consumers via DTH service providers.
Netflix and other OTT Player rankings in India
Off late fierce competition has kept all the OTT players on their toes. Almost all television channels now have an extended reach over their OTT app with exclusive content over the medium. Star’s Hotstar, Viacom 18’s Voot, Sony’s LIV have been striving to get majority share in a very nascent stage backing up with huge investments on the platform as well as marketing. However, few new players have disrupted the plans. Global giants like Amazon Prime and Netflix have joined the bandwagon along with home grown Jio TV and Jio Cinema. Below is how the of the OTT players stack up in rankings. Netflix just manages to make it to the list.
Netflix India Strategy
Netflix has always been a premium player in all the countries wherever it has a presence. With high quality exclusive content curated for a TG skewed towards higher NCCS (New Consumer Classification System) in India, Netflix India pricing too demands a premium. Even the basic pricing, without an access to HD streaming, costs Rs 500/month which is almost double the ARPU (Average Revenue Per User) of DTH subscriptions (ARPU for the biggest player Dish TV stands near Rs 175 as in FY 16). Besides this, there always is a data cost associated whenever you fire the Netflix app.
Netflix clearly stated during their launch in India that their target is the wealthier lot with high disposable income and an interest towards english entertainment. To be more specific Netflix in India targets people in the age group of 25-35 yrs and preferable holding an international credit card or an iTunes account. Netflix targets wealthy Indian viewers – Warc
Netflix India Issue
Though there has been a multi fold growth for almost all the OTT players including Netflix, but Netflix India numbers active user numbers seems to stagnate over couple of months. Also, the total time spent viewing has almost been stagnant right from the month of launch and is currently on a decline. Other OTT players might afford experimenting as their platform is an extension of a well established channel on television. However, in case of Netflix its imperative to increase reach. Thereby company’s move to provide content over DTH providers is not a surprise.
Netflix India DTH Alliance with Airtel & Videocon
Netflix India has roped in Airtel Digital TV and Videocon D2H for reaching out to the masses. Both Dish TV, the biggest player in the market and Tata Sky with a better TG fitment, have been left out. Though the tie up will definitely enable Netflix to reach Indian household but when considering revenues certainly Tata Sky would have been a better fit. Tata Sky’s ARPU is easily estimated to be in excess of Rs 300 currently (was Rs 270 in 2010). The ARPU of Airtel Digital TV and Videocon D2H stand at Rs 233 and Rs 219 respectively as in Jan 2017. With all premium channels on Tata Sky – Le Plex HD, Star Movies Select etc- it is a no brainer that it would have been a better fitment.
Netflix, on the other hand and very unlikely, might be focusing solely on increasing reach and rake in the moolah from advertisers. Though we do not come across ads on Netflix as on Hotstar or Voot but you never know what may be in store for a price sensitive market like India. Also, there is a possibility that Tata Sky might have not entertained the alliance as they themselves focus on making revenue with their own paid subscriptions – Showcase Movies and Video on Demand Services.
We just hope that Netflix decision makes them stay in India for longer so that we have our uninterrupted dose of entertainment.