Netflix plans local studio in India push. Move comes as rival Amazon Prime Video lines up as many as 18 original shows for India.
Netflix, the world’s leading video-on-demand service, proposes to set up a production facility in India, the company’s management said in a recent analysts’ call, as the pressure to localise content grows in a market that has enormous potential for the VOD business.
Speaking to investors, Netflix's chief content officer Ted Sarandos said, “We are already building our production capabilities outside the United States. Today, we are filming local shows in 13 different countries, including India and Japan. We think, it is going to be a combination of big global interest in original programming, complemented with a growing number of local-language original series in each country.”
During his maiden visit to India in March, Netflix CEO Reed Hastings spent time meeting media and entertainment chief executives here, besides catching up with Bollywood celebrities, to understand the content requirements of the domestic market.
Some tie-ups were announced such as the one with Shah Rukh Khan’s Red Chillies Entertainment, where the movie star’s films would be exclusive to Netflix for the next three years. Beside, an English-and-Hindi-language adaptation of author Vikram Chandra’s book Sacred Games, Netflix’s first original series in the country, is being produced in partnership with Anurag Kashyap’s Phantom Films.
But, sector experts say with rival Amazon Prime Video upping the ante in India in terms of local productions, Netflix will have to do more if it has to sustain viewer interest in a competitive market. The Jeff-Bezos-led Amazon.com has already lined up as many as 18 original shows for Amazon Prime Video in India -- all of which have hit the floor and are in various stages of production.
The investment on these original shows, the largest outside the US, is billed at Rs 500 crores, a quarter of the Rs 2,000-crore budget Amazon has set aside for its Prime Video service in the country, launched in December 2016.
In an earnings concall last month, Amazon CFO Brian Olsavsky said India was an important investment area for the company and that it saw significant potential for its business in the country.
While Amazon spent $3 billion (or Rs 19,500 crore) in content production in 2016, Netflix’s spending was $6 billion (or Rs 39,000 crore) for the same period. But, much of this was in countries such as the US, which is the world’s largest VOD market at $25 billion (or Rs 1.62 lakh crore). The global VOD market is pegged at $50 billion (or Rs 3.25 lakh crore) in size.
Though Amazon and Netflix have not indicated their overall content budgets for 2017, analysts estimate it will be double the amount spent by the two last year, as their attention shifts to international markets, where both have aggressively expanded in recent years.
At the above-mentioned analysts call, Netflix CEO Hastings said about Amazon: “We do think about all of that (Amazon’s work) and their tremendous track record. On the other hand, they are doing great programming and they will continue to do that. But, the market is vast.”