The subscription model is not one that all players are willing to go for. Take the case of MX Player where advertising is the big story. “There is a huge market for digital advertising that is untapped. In China, 70 per cent of total advertising comes from digital. In that sense, there is a lot we can do in India [broad estimates suggest we are at 18-20 per cent in India],” says Karan Bedi, CEO, MX Media. His company has taken baby steps on subscription, though Bedi says it is still iterative in terms of approach. “We are at the testing stage only and may do things like going ad-free for a few shows or early access. Our research indicates a small proportion will take the subscription route. In that sense, the thrust will continue to be on advertising where there is a huge opportunity.”

Ormax says Netflix needs that “breakout Indian show” to make a big mark. “In the case of Amazon, it would be The Family Man and for Hotstar, there is always the IPL. Netflix is still known for Money Heist and some international shows like House of Cards. A vast majority of the Indian audience will say Sacred Games but they need something more recent in the Indian context.” Questionnaires sent to Star and Disney India, Amazon Prime Video and Network18 (the owners of Voot) remained unanswered.

Shergill, however, seems unfazed. She says that these are still early days in India’s streaming journey, and at this stage, competition is a “very good thing” as all services are in ramp-up mode, and each with a different model. “What Netflix has uniquely is a pure-play, global content service, with the width, depth and scale that only Netflix has. And what we are here to do is to actually make Netflix India the way the global Netflix is,” she says. “So, in that journey, there will be competition. There is more demand currently [and] less supply, because it is the same creative pool. But at the end of the day, the competition will increase the talent pool, will force all of us to find newer voices, to have more ways of nurturing creators and projects, and bringing the best entertainment on to our individual services.” Also, considering that unlike cable and DTH, streaming has no distribution mechanism, competition is healthy — “because it pushes us to do one-to-one storytelling, co-viewing storytelling, format-based, mood-based, so long as the cohorts are large enough, they are actually consuming that. It allows you to experiment”.

Okay, so, competition is good, competition and Netflix will grow together, they will also grow the paid subscriptions market. But that still leaves open the question of how Netflix will grow. Netflix believes that it can achieve growth through strong focus on original, local content. Shergill explains that this strategy defers to a global template followed by the company. For the first three years, Netflix was in India as a global service. And then it formed a local content team. “That’s how we scale in any country,” says Shergill. “In nearly 130 countries [including India, where the service was rolled out in 2016], we’ve come in like the global service, and then we’ve gradually scaled up our local efforts. So [in India] we are in the early stage of that journey.” It is a point explained in greater detail by Sunil Gupta, Edward W. Carter Professor of Business Administration, Harvard Business School. According to him, Netflix adapts its pricing model to suit the local macroeconomic and competitive landscape. “The goal in each market is initially to gain customers [leveraging international content] and as this customer base grows, Netflix benefits from economies of scale for its digital content — marginal cost of streaming digital content to another customer is close to zero,” he points out.

In the past few years, Netflix has invested Rs 3,000 crore on content in India. In March 2021, it announced a slate of 41 titles; since then, it has revealed more titles, including Monica, O My Darling; Plan A Plan B; and Ankahi Kahaniya. Itis also collaborating with film-maker Sanjay Leela Bhansali for Heeramandi, a web series. “Original content is the heart and soul of Netflix, because globally, everywhere we stand for that,” says Shergill. However, she is quick to add that Netflix is ready to acquire the best kind of content out there, whether they are films, series, or documentaries.

Netflix has worked with Karan Johar’s Dharmatic Entertainment and Shah Rukh Khan’s Red Chillies Entertainment, and recently announced a multi-year partnership with Ritesh Sidhwani and Farhan Akhtar’s Excel Entertainment, which will produce a variety of stories under its banner Excel Media & Entertainment for the OTT platform. It kicks off with two projects tentatively titled Dabba Cartel and Queen of the Hill. A few years ago, it made a strategic foray into markets outside Hindi such as the south and met with success. Titles such as Navarasa, Jagame Thandhiram, Maniyarayile Ashokan, Miss India and Ala Vaikunthapurramuloo worked not just in India but also made it to the top 10 in many other countries. Today Netflix has content in all four south Indian languages, apart from Marathi, Punjabi, Bengali and Gujarati, among others; it has worked with film-makers such as Mani Ratnam, Vikramaditya Motwane, Ashwiny Iyer Tiwari, and Abhishek Chaubey, among others. Screwvala says that for Lust Stories, which he produced, he told Netflix that he wanted to make the film in Hindi, Tamil and Telugu, and that too with big-ticket directors helming 30-minute segments. And Netflix had the “vision” to accept it. “So that openness, that ability to take those breaks, and to actually think one year, two years ahead, is really what struck me,” he says.