MUMBAI: The Indian unit of Netflix Inc, the world’s largest online video streaming company, grew more than 700% during 2018-19, helped by expanding local content and marketing blitzkrieg that helped bring subscribers.
Netflix India reported revenues of Rs. 466.7 crore for FY19 with a net profit of Rs. 5.1 crore, according to its filing with the registrar of companies sourced from Veratech Intelligence. In FY18, Netflix India had a turnover of Rs. 58 crore with Rs. 20 lakh net profit, which reflected financials for seven months starting September last year after the actual transfer to local distribution entity from Singapore.
“A combination of factors including original content for India, partnership with Airtel for better access to market and fixing payment issues helped Netflix,” said Mohit Yadav, founder of Veratech. “All this combined with new low cost-based variants for a price-sensitive Indian market is the reason behind Netflix’s phenomenal growth.”
While the California-based company entered India in January 2016 as part of its global rollout, Netflix was registered as a limited liability partnership (LLP) in the country in April 2017 when it started commissioning content.
Since the company doesn’t share region wise content cost or amortisation ratio, it is difficult to ascertain operating profitability in the market. Netflix India did not respond to an ET query as of press time Sunday.
The number of digital video viewers in India continues to grow as cheap data plans flood a country of 1.3 billion people, say experts. The country currently has more than 300 million online video viewers, and it’s expected to reach 550 million by FY23. There are 39 companies offering video streaming services, up from nine in 2012. Netflix has low digital video viewers in the country compared to rivals due to its relatively high prices and low amount of local-language content. Its monthly subscriptions start at Rs. 500, which doesn’t allow simultaneous viewing. Higher plans (`650 and `800) allow for multiple users and simultaneous viewing.
Star India’s streaming platform Hotstar, which controls nearly three fourth of the market, offers a VIP plan for Rs. 365 a year and premium plan at Rs. 999 per year, while Amazon Prime Video has a monthly plan of Rs. 129 and annual of Rs. 999. The entry of Apple TV+ at Rs. 99 per month and launch of Disney+ next week are expected to make India a hotbed for content war.
While Netflix doesn’t share subscriber numbers of individual markets, industry estimates put the video streaming service’s Indian subscriber base at 1-1.2 million as of March 2019. The number has increased post July this year when the company launched a mobile only plan at Rs. 199 per month.