In an investor call on Thursday, Netflix co-founder, president, and co-CEO Reed Hastings stated that the firm’s lack of success in India is “frustrating,” but that the company is “absolutely pushing in there.”

The global streaming giant, based in Los Gatos, California, saw its stock plummet after announcing that it expects to add only 2.5 million new news subscribers in the current quarter, the lowest for the first quarter in nearly a decade, added 2.6 million new paying subscribers in the Asia Pacific region in the last quarter (up from 2 million in the same quarter last fiscal), with strong growth in both Japan and India.

While Netflix has never disclosed the number of Indian members, market estimates place the figure between 4.3 million and 4.5 million, a fraction of rivals Disney+Hotstar (almost 36 million) and Amazon Prime Video (nearly 4.5 million) (over 17 million).

Netflix cut its prices in India in December to make the service more accessible to a larger range of customers. However, many experts feel that the move will only increase the number of users who were already using the service due to account sharing.

Netflix’s chief operational and product officer, Greg Peters, said during the webcast on Thursday that the price shift is the result of a series of actions the firm has been conducting in India over the years. “We’ve been operating there and learning more about Indian consumers’ tastes, et cetera,” Peters explained, “and that’s widening the service offering across many, many different dimensions.” “We decided it was the perfect time to lower our prices there, to make it more accessible to everyone… we’re looking at it from the perspective of long-term revenue maximization.”

While Netflix expects a reduction in average income per member as a result of the price cuts, Peters believes the company will make up for it by adding more subscribers.

“I believe it is still too early to consider India. And it takes a couple of months to get a pretty clean read on some of these impacts, such as retention,” he said. “However, the early data we’re seeing strongly suggests that the lens of revenue maximization through these modifications is a positive read.”

Hastings previously stated that India’s pay-TV pricing, which is roughly $3 per month per household, is unusual. “Rarely different pricing from the rest of the globe,” he continued, “which has an impact on consumer expectations.”

When asked if Netflix will consider right-sizing content spend or switching to an ad-supported model, he indicated it will be a long time before the firm makes any significant changes to its business model.

“For the first couple of years in Brazil, we found it to be really difficult. We feared we’d never make a profit. I know we’ve got a terrific company… The good news is that we’ve got the flywheel turning in every other significant market. Why haven’t we been as successful in India is something that annoys us, but we’re definitely leaning in there “According to Hastings.

After two years, Netflix, the first global OTT provider to launch in India in 2016, began to establish staff and invest in original content.

Hastings announced in 2018 that the firm would spend Rs 2,000 crore on content in India over the next two years, more than the combined programming budgets of the top four Hindi general entertainment networks.

Many of the series and films, on the other hand, have yet to draw huge audiences.

Netflix’s strategy and approach of “throwing money at every problem,” according to experts, is to blame.

“One of the most serious challenges with Netflix in India is that it is unclear which market they are targeting. Is paying Rs 85 crore for a ‘Sooryavanshi’ reasonable? “They’ve always had a thing for Bollywood, and the regional plan is too little, too late,” a top executive at a competitor service said.

According to a senior executive who left Netflix last year, the brand is very strong, but they need to figure out if they want to focus on keeping and growing engagement from existing users or on attracting new subscribers.

“It’s only the first in India,” he explained. “Also, when I worked at Netflix, it looked like we had all forgotten about the return on investment (return on investments). We were all given an unlimited budget to spend on content, marketing, and PR, among other things. There was no dispute about who was responsible “he stated

Netflix Group CFO Spencer Neumann noted on the investor call that while the company has a “terrific business” and a “terrific business model” that scales effectively, it is also extremely difficult in every country.

“Every country has a different adoption curve, and we talk about product-market fit, but even if everyone enjoys movies, television, and games, it’s a really specialized situation. Around the world, entertainment is still largely regional. So it’s both global and local, and we have to figure out which is which “In response to a question on India, he stated.

Previous articleDeployed All Hexagonal Mirror Segments, NASA Says
Next articleLata Mangeshkar showing Positive Signs of Improvement