Monday, June 20, 2016

Eye2Eye - Does Netflix’s entry into the Indian Market spell disaster for the Indian Blockbuster business? || Shreya Singh & Abir Nandi || NMIMS, Mumbai & IIM Shillong || February 2016 edition

Does Netflix’s entry into the Indian Market spell disaster for the Indian Blockbuster business?

Frank Underwood’s ruthless cold demeanor, Narcos’ hypnotic theme song Tuyo, Badass Detective Jessica Jones, Netflix, with its diverse globalized content will make it all available to Indian viewers without us resorting to torrents and proxies. Not only that, it will put India on the global map of over the top (OTT) and content distribution market forging better telecom infrastructure. Talk about killing two birds with one stone!
Netflix’s stronghold lies in its ability to create original content and India has been promised local stories to cater to the eclectic taste of watchers. Its subscription only business model ensures that ads don’t pop up when you are engrossed in a show. Content devoid of censorship, dynamic library with constant addition of content, suggestions based on mood by creating multiple profiles provide an extra ‘oomph’ to the popularity of Netflix as well as a reason for the Indian Blockbuster Business to hit the panic button.
The rickety infrastructure in India does pose a threat to Netflix’s grandiose schemes. Netflix, however, uses clever algorithms that predict the drop in the connection speed and accordingly changes the streaming quality so that the episode runs for as long as possible. Data usage settings as Low (0.3GB/hr), Medium (0.7GB/hr), High (3GB/hr for HD and 7 GB/hr for Ultra HD) and Auto provide a judicious data cap and the monthly subscription rates have been designed keeping the niche market of Independent Cinema lovers and English TV show binge watchers in mind and therefore rates starting from Rs. 500 are not bothersome. Henceforth, the offerings Netflix provides are enough to create a gradual shift in the blockbuster business.  
With such a vast array of video on demand available on the interface of your choice, anytime, anywhere, why would any TV series aficionado want to go anywhere else?

Netflix has arrived from the western shores, armed with a catalogue of movies and shows, and is looking to cash in on the demand for high-quality content among the Indians with a proclivity for premium entertainment services. Most of these would be young, working and with money to spare. Even if we ignore, for now, their penchant for “taking to the high seas”, a habit they would have picked up in their college days or earlier, we have to take note that they form a minuscule minority of the movie-going public in India. Even if these people decide to replace their visits to the multiplexes with “Netflix and Chill”, they would barely make a dent to the box-office numbers of our “Bollywood Blockbusters”.
The much-maligned “Bollywood Blockbuster” is the love-child of the masses’ nigh unquenchable thirst for entertainment and the Indian film industry’s stubborn knack of sticking to the proven formula. Their consumers come from diverse places of origin and social strata- be it the 30 year old auto-rickshaw driver looking to end the week with light-hearted entertainment or the 18 year old engineering student indulging in a guilty pleasure. The Chennai Expresses and the Happy New Years of India are here to stay, bolstered by the 13000 odd single screen theatres in India that cater to the “Big Billion”, the 1500 odd multiplexes notwithstanding.

Unless Netflix acquires rights to or decides to produce local content with mass-appeal, Bollywood would not be bothered about it. Even if Netflix does come out with such content in the future, the design of the service itself would restrict it to those with access to computer screens. It can thus be safely said that Netflix will fit into a very distinct niche of the entertainment market without causing the Bollywood honchos too much headache.


Sunil Goyal said...

Competition is always good for consumers as well as brands, so there shouldn't be any fear on the entry of a reputed brand.

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