Mediaboss Marketing

Netflix is aiming for a 20-fold increase in subscribers in India, but its journey in the nation has been bumpy. And now its getting a lot bumpier.

The Covid-19 crisis has forced film and TV production in Mumbaithe home of Bollywoodto shut down. According to Variety, Netflixs local productions are not only shut down in Mumbai, but also in Delhi and Lucknow. The company revealed on an earnings call this month that its back up and running safely in every country in the world except India and Brazil (pdf).

The shutdowns, of unknown duration, will thwart the momentum Netflix had been starting to build in India with its homegrown productions. Covid-19 wont last forever, and Bollywood will return to production eventually. Netflixs opportunity in India is immense, and the company is still committed to seeing it through. It just might take a lot longer than it planned.

Netflix is so interested in India because the movie-loving country (it produces 2,000 films per yearmore than the US) represents perhaps its biggest single-market opportunity since it started producing original content in 2015.

India is the worlds fastest growing streaming market, according to a 2020 report by PwC. Half of the countrys 1.4 billion peopleare under the age of 25, and by 2022, India is expected to have more than 800 million smartphone users. Netflixs expansion in India is part of a broader push throughout Asia, which has served as the source of much of the services subscription growth in the last few years.

The streaming service launched in the country in 2016, catering mostly to affluent, English-speaking consumers. It initially struggled to compete with cheaper entertainment options from the likes of Amazon, a brand thats long been popular with consumers in India, and Hotstar, which is now owned by Disney and was integrated into Disneys own streaming service, Disney+, last year.

In 2018, Netflix adjusted its India strategy to meet its bold vision. It invested more in local productions, offered a cheaper mobile-only plan (which the company said had better retention than it anticipated), and partnered with existing distributors like Reliance Jio to bring the service to new demographics. It also added Hindi to its interface and committed to more local-language productions, like the crime series Sacred Games, which debuted in 2018 and remains Netflixs most popular Indian show to date.

As of December, Netflix had about 5 million subscribers in Indiawell short of its 100 million goal. Executives have admitted they will continue to experiment with the strategy. India, were still figuring things out, Netflix co-CEO Reed Hastings said on the companys most recent earnings call. And so that investment takes some guts and forward-looking belief. This year, Netflix plans more than 40 original Indian movies and TV showssignificantly more than its output in most places outside North America.

But Netflix cant really afford to turn off thespigot of content it opened in India in 2018. Because the Netflix brand is not as well-known to many Indian consumers as some of its competitors, the company has tried to stay fresh in viewers minds with lots of new contentat least a few of which, the company hopes, will be hits, like Sacred Games. Throughout the pandemic, its done a very good job engaging its users in India.

The indefinite pause in production, however, will likely reduce the amount of new content Netflix subscribers in India see, and thus lessen the chances of a breakout cultural phenomenon. In the US, Netflixs subscription growth has slowed, which the company attributes directly to production pauses causing a lighter than usual slate of content.

Netflix has already nearly saturated the US market, so three months with weak content in the country wont be devastating. But, in India, a similar light slate could set the company back a long time in its quest to reach 100 million, especially when its competitors have such widespread recognition. Hotstar, for instance, is operated by the media conglomerate Star India, whose networks are in 90% of pay-TV homes in India.

Whenever Netflix does return to production in India, it will face much greater government scrutiny than when it first entered the country in 2016.

After shows like Sacred Games were accused of being vulgar by politicians aligned with prime minister Narendra Modi, Netflix and other streaming services began self-censoring some content, with the hopes of avoiding controversy and staving off regulation. Modis government has since changed the regulatory agency under which streaming companies operate, largely seen as an attempt to start clamping down on content on services like Netflix.

Such regulations could have a chilling effect on the thriving creative community in Bollywood. A number of filmmakers and actors in India told CNN last month that they are now walking on egg shells, worried not only that many of the countrys most provocative projects wont get off the ground now, but also that they could face jail time for just doing their jobs. Netflix in particular could struggle to replicate the success of Sacred Games in this stifling environment.

Read the original here:
Netflix's big plans in India may be slowed by Covid and censorship - Quartz